DRBHCOM (1619) : DRB-Hicom purchase of Gading Sari steep but scales up logistics ops
KUALA LUMPUR: DRB-Hicom subsidiary KL Airport Services Sdn Bhd’s purchase of air freight operator Gading Sari for RM72mil cash is steep, says AmResearch.
It said on Tuesday despite the pricing, this is a relatively small initial investment in the air cargo transport sector.
“DRB-Hicom now has the opportunity to scale up its logistics operations along with Pos Malaysia. We maintain Buy, with an unchanged fair value of RM3.60 a share – a 15% discount to our sum-of-parts value of RM4.25 a share,” it said.
DRB-Hicom had stated the transaction was on a willing buyer-willing seller basis and after taking into account Gading Sari’s audited net asset value of RM7.2mil as at Dec 31, 2013, audited profit after tax of RM2.2mil and the future earnings.
“We are of the view the purchase is steep at 10 times the net asset value and 33 times FY13 earnings,” it said.
Earlier this year, DRB-Hicom assumed control of haulier Konsortium Logistik Bhd (KLB) for RM390mil via a takeover offer price of 2 times price-to-book value (PBV) and a 23.6 times trailing PE.
This is also part of KLAS’ bigger plan in providing an intermodal logistics solutions and supply chain management (SCM) and will help transform the group to become a fully integrated logistics service provider providing an end-to-end SCM.
“DRB-Hicom said it is in line with the group’s plan to develop KLAS into a leading centralised integrated logistics provider in Malaysia by providing a one-stop solution.
“It will be funded via internal funds and borrowings. DRB-Hicom said the vendors would endeavour to assist KLAS to successfully renew the Air Operator Certificate upon its expiry in February 2015,” it said.
Gading Sari provides air freight services to Pos Malaysia, an associate of DRB-Hicom – for the PosLaju service between the peninsula and Kuching, Miri and Kota Kinabalu – believed to be with two leased planes.
Gading Sari's major shareholders include the Crown Prince of Pahang, Tengku Abdullah Sultan Ahmad Shah (45%), Vescargo Sdn Bhd (35%) and Tengku Azman Sultan Abu Bakar (10%), Tengku Datuk Zafrul Tengku Abdul Aziz (5%) and Raja Mufik Affandi Raja Khalid (5%).
http://www.thestar.com.my
KUALA LUMPUR: DRB-Hicom subsidiary KL Airport Services Sdn Bhd’s purchase of air freight operator Gading Sari for RM72mil cash is steep, says AmResearch.
It said on Tuesday despite the pricing, this is a relatively small initial investment in the air cargo transport sector.
“DRB-Hicom now has the opportunity to scale up its logistics operations along with Pos Malaysia. We maintain Buy, with an unchanged fair value of RM3.60 a share – a 15% discount to our sum-of-parts value of RM4.25 a share,” it said.
DRB-Hicom had stated the transaction was on a willing buyer-willing seller basis and after taking into account Gading Sari’s audited net asset value of RM7.2mil as at Dec 31, 2013, audited profit after tax of RM2.2mil and the future earnings.
“We are of the view the purchase is steep at 10 times the net asset value and 33 times FY13 earnings,” it said.
Earlier this year, DRB-Hicom assumed control of haulier Konsortium Logistik Bhd (KLB) for RM390mil via a takeover offer price of 2 times price-to-book value (PBV) and a 23.6 times trailing PE.
This is also part of KLAS’ bigger plan in providing an intermodal logistics solutions and supply chain management (SCM) and will help transform the group to become a fully integrated logistics service provider providing an end-to-end SCM.
“DRB-Hicom said it is in line with the group’s plan to develop KLAS into a leading centralised integrated logistics provider in Malaysia by providing a one-stop solution.
“It will be funded via internal funds and borrowings. DRB-Hicom said the vendors would endeavour to assist KLAS to successfully renew the Air Operator Certificate upon its expiry in February 2015,” it said.
Gading Sari provides air freight services to Pos Malaysia, an associate of DRB-Hicom – for the PosLaju service between the peninsula and Kuching, Miri and Kota Kinabalu – believed to be with two leased planes.
Gading Sari's major shareholders include the Crown Prince of Pahang, Tengku Abdullah Sultan Ahmad Shah (45%), Vescargo Sdn Bhd (35%) and Tengku Azman Sultan Abu Bakar (10%), Tengku Datuk Zafrul Tengku Abdul Aziz (5%) and Raja Mufik Affandi Raja Khalid (5%).
http://www.thestar.com.my
