Tuesday, October 11, 2011

OSK Research maintains Buy on TSH Resources

KUALA LUMPUR: OSK Research is maintaining its Buy rating on TSH RESOURCES BHD [] with a fair value of RM3.81, based on 13.5 times mid-CY12 EPS.

The research house said the upbeat outlook was also based on the estimated market value of its rubber areas of 32 sen per share.

'The company possesses one of the youngest tree age profiles and strongest production growth among Malaysian companies within our PLANTATION [] universe,' it said.

On Monday, TSH proposed a bonus issue of up to 416.7 million new shares on the basis of one bonus share for every one existing share.

Following the one-for-one bonus issue, OSK Research's present fair value on TSH of RM3.81 would be adjusted to RM1.91.

Assuming full exercise of TSH's 1.14 million outstanding ESOS options, representing just 0.3% of the shares outstanding, its FV will be adjusted downwards to RM1.90.

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