Exposure to ASEAN emerging markets, predominantly in Indonesia with strategic investment in Siam Cement and 10% holding in Vinamilk (F&N is 20%). Vinamilk is high growth company which pay dividends to C&C.
Poor valuation despite recent correction in price. The valuation model appears to be quite accurate in the sense that the fair value is around $35 which the stock price approaches for the past 1 year with peak at $37. Recent low is at $28 at 2015. The stock last seen $25 at 2009/2010 with its bottom at around $9. Unless we are expecting another 2009 GFC type of event, the price should not drop drastically.
reasonable debt/equity ratio excluding its financial subsidiaries. Interest coverage is > 10x with net financing charges of 161MM vs profit of 2B.
reasonable debt/equity ratio excluding its financial subsidiaries. Interest coverage is > 10x with net financing charges of 161MM vs profit of 2B.
Total debt of 4.5 + 2.8 (long term) vs equity of 13B. Non financial debt is 2.7+1.1 (long term).
OP Cash flow is 2B vs dividend of 0.3MM while investment is also 2B. To finance increasing dividends, they need to generate more cash or cut investment. They are holding more investment to support future growth.
Its historical fair value margin is ~20%. Based on this margin, the entry price is ~$28.5 which is another 10% discount from current price. If price drop to this level, it may be an interesting entry point. However, current PE is 30x and dividend yield of <3%. Abit on the rich side. If the growth rate does not support the large PE, there will be price correction.
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