MALTON (6181) - MALTON, MALTON-LA or MALTON-WB?
MALTON closed at RM0.665 last year, and it is now RM1.15, a 73% increase withjin 2 months plus!
Will it go up further? I dun know. However, looking at the current prices of MALTON, LA and WB, I think LA is the best bet among them.
As usual, to compare them, I use binomial method to find out the fair value of LA and WB.
What do we need to assume? Without these assumption, then all the following calculations are meaningless:
1) Current price of MALTON is fair.
2) The future gain (price change plus dividend) for MALTON is 7% p.a.
3) Future Volatility of MALTON share is equal to its last 90 trading days historical volatility.
4) MALTON will issue 3 sen dividend in December 2017.
First, find out the fair value of LA, it is a bit complicated as LA does pay interest 6 sen p.a. and cash redemption in June 2017 and june 2018, the ratio is 25/55 for 2017 and 30/55 for 2018, the meaning is, suppose you have 55000 units as at June 2017, 25000 units will be redeemed at RM25000 this year and the remaining 30000 units will be redeemed at RM30000 next year.
So the fair value calculations have to be in two parts, one for 2017 and the other one for 2018.
Look at the following excel spreadsheet for 2017 part, the fair value is RM1.1978.
Now look at the next excel spreadsheet for 2018 part, the fair value is RM1.2694.
So the overall fair value for MALTON-LA is (25*1.1978+30*1.2694)/55=RM1.2368, it is 17% higher than MALTON-LA's market price of RM1.06.
Now, we must also look at MALTON-WB's fair value. Look at the following excel spreadsheet, its fair value is RM0.2743, a 13% lower than its market price of RM0.315.
Kindly be informed that I currently own some MALTON-LA, and you are investing at your own risk.
Happy speculating.
MALTON (6181) - MALTON, MALTON-LA or MALTON-WB?
http://klse.i3investor.com/blogs/gambler/118077.jsp
Will it go up further? I dun know. However, looking at the current prices of MALTON, LA and WB, I think LA is the best bet among them.
As usual, to compare them, I use binomial method to find out the fair value of LA and WB.
What do we need to assume? Without these assumption, then all the following calculations are meaningless:
1) Current price of MALTON is fair.
2) The future gain (price change plus dividend) for MALTON is 7% p.a.
3) Future Volatility of MALTON share is equal to its last 90 trading days historical volatility.
4) MALTON will issue 3 sen dividend in December 2017.
First, find out the fair value of LA, it is a bit complicated as LA does pay interest 6 sen p.a. and cash redemption in June 2017 and june 2018, the ratio is 25/55 for 2017 and 30/55 for 2018, the meaning is, suppose you have 55000 units as at June 2017, 25000 units will be redeemed at RM25000 this year and the remaining 30000 units will be redeemed at RM30000 next year.
So the fair value calculations have to be in two parts, one for 2017 and the other one for 2018.
Look at the following excel spreadsheet for 2017 part, the fair value is RM1.1978.
Now look at the next excel spreadsheet for 2018 part, the fair value is RM1.2694.
So the overall fair value for MALTON-LA is (25*1.1978+30*1.2694)/55=RM1.2368, it is 17% higher than MALTON-LA's market price of RM1.06.
Now, we must also look at MALTON-WB's fair value. Look at the following excel spreadsheet, its fair value is RM0.2743, a 13% lower than its market price of RM0.315.
Kindly be informed that I currently own some MALTON-LA, and you are investing at your own risk.
Happy speculating.
MALTON (6181) - MALTON, MALTON-LA or MALTON-WB?
http://klse.i3investor.com/blogs/gambler/118077.jsp
