BUY call from Hong Leong...

This post has been edited by river.sand: May 15 2012, 09:54 AM


Attached File(s)
 HLIB___Sunway_REIT_2012_05_15.pdf ( 1.33mb ) Number of downloads: 125

When is the date for IGB reits.

Want loading bullet.

You can load bullets now. Quite a few REIT counters are in red today.

Top up more AXreit at 2.67

Expecting on Q1 2013

IGB just submitted the proposal to SC few days ago.

Guess need atleast 6 months for all the paper work goes through.

Do you guys aware that by buying 6653 KASSET, you will be entitled for Capital Distribution + Special Dividend + IGB-REIT Shares?

This post has been edited by panasonic88: May 15 2012, 05:19 PM

Methinks U've just started a stampede

what is the criteria to determine which REIT is better? by yields? by NAV?

http://mreit.reitdata.com/

Thank you.

Don't see much move those I am eyeing.

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Added on May 15, 2012, 6:08 pmAlamak. Still far away.

This post has been edited by ozak: May 15 2012, 06:08 PM

Alright, after going thru the 24 pages of KrisAsset papers, here's some brieft summary I'd like to share :

Summary
~ CIMB & Hong Leong are Joint Peincipal Advisers
~ KrisAssets proposed to sell Mid Valley & Gardens Mall to IGB Real Estate Investment Trust for RM4,612.6 million
~ In return, KrisAssets will receive 3,400 million units in the IGB Reits and the balance in cash
~ The company will distribute 2,730 million of the units (Distribution-in-Specie) and Cash Distribution (Single-tier interim special dividend) proceeds to its shareholders



A) For every 1,000 shares of KrisAsset you own
(Distribution In Specie / Market Share ) X 1000
( 2,730,000,000 / 440,432,058 ) x 1000 = 6,198 shares of IGB REIT

B) & C) added up will be around RM1,270 million aka RM2.88 per share (special divvy + capital repayment)

**Pls correct me if my calculation is wrong

~ Once the disposal completed, KrisAssets will be a company without any business or operations
~ Bursa Securities may classify it as a PN17 Company as it triggered the criteria of suspended or ceased of business / insignificant operations
~ The Board has no intention to maintain the listing status of KrisAssets
~ Will be delisted after completion of Proposed Distribution


IGB REIT
~ Mid Valley Occupancy rate: 100%
~ Gardens Mall Occupancy rate: 99.6%
~ MV Rental & Car Park Income: RM210.6 million per annum
~ GM Rental & Car Park Income: RM87.7 million per annum
~ Estimated time frame for full utilisation of proceeds from date of Proposed Listing : within 6 months

Potential of IGB REIT
~ Benefits from the potential future upside & envisaged growth
~ Enjoy stable & regular distribution
~ Appeal for those who seeks regular income distribution & long term capital appreciation
~ 100% distribution from the date of listing till 31st December 2014
~ Thereafter atleast 90% of distribution income on half-yearly basis

Side info: The KrisAsset & IGB company are run by a Tan family.

This post has been edited by panasonic88: May 15 2012, 08:55 PM

The market already anticipated.
Krisasset share price already surged from last year Rm4.xx to Rm7.xx


So if one bought at 7.xx currently of Krisasset, it may become (solely based on the info posted, I personally do not go through it (yet),
one ended up with Rm2.88 + 6,198 IGB reit.

So the key is (whether to buy KrisAsset now at RM7.xx), what is the valuation for IGB reit, and IPO price.

Assuming:

Buying Kasset at 7.40 x 1000 share = RM7400
Entitle for IGB REIT 6198 shares + RM2880 (Capital Repayment & Special Divvy)
RM7400 - RM2880 = RM4520
RM4520 / 6198 SHARE = RM0.729

Invested RM7400
Take back RM2880
Investment cost become RM4520
IGB REIT 6198 share, which means the cost is RM0.729 per share

===

Next, waiting for IGB-REIT IPO price & hopefully is above that cost

I do have a hunch that share price will further advanced when the official announcement is out, now it depends on whether you are willing to park your money there for probably 6 months or so



This post has been edited by panasonic88: May 15 2012, 09:55 PM

On page 13-15, it does mention the Risk Factors, such as:

~ Delay or non-Completion of the deal (disposal & distribution)
~ Price of share may decline after the listing due to various market sentimental
~ Liquidity of the shares on Reits market may result one to hold their units for indefinite length of time
~ Proposed listing may not be granted due to various reasons

My understanding of the story:

Kasset
~Kasset is disposing MVC (mid valley city) and MVCG (mid valley city garden) for a total consideration of RM4,612.6M.
~That amount will be satisfied via 3,400M Units of IGBReit and Cash of RM1216.2M.

~From the 3,400M units, 670M units will be offered through an IPO at a later date and 2,730M units will be distributed to Kasset shareholders.
~From the RM1,216.2M and 670M units proceeds will be used to settle all outstanding debt and the balance will be distributed back to Kasset shareholders via cap repayment or dividend.

~From the 670M IPO, 201M units to M'sian public and employees while the remaining 469M to institutional investors.

~By the completion bond redemption, cancellation of treasury shares and liabilities settlement, Kasset will have 520,997,000Shares.

2,730,000,000 / 520,997,000 = 5.24.
Each Kasset will give u 5.24 IGBReit.

Kasset will have a total cash of 1,212.559M + 670M (IPO) = 1,812.559M cash
From there, the distributable sum is 1,266.990M.

1,266,990,000 / 520,997,000 = RM2.43 per share.

Therefore:
Buying 1k of Kasset today would have cost you RM7,400.
You will get back RM2,430 cash + 5,240 IGBReit.

(RM7400-RM2430)/5,240=RM0.948 per unit of IGBReit
Theoretical IPO Price is RM1.00. so yeah, you do get some sort of discount.
Market is super efficient... that is why it never goes beyond RM7.60.. I still have so much to learn...

Considering they are valuing MVC and MVCG at 4,600M, each IGBReit should be worth around (RM4,600M / 3,400 Units) = RM1.35

Estimated Rental Income per year for MVC and MVCG are RM210.6 and RM81.7. Total is RM292.3M
RM292.3M/3,400M = RM0.0859 a year.
assuming 90% distribution, that will be RM 0.0773 DPU a year.

Cost is 0.95. DPU 0.077, Yield is : 8.1%, and nett Yield after Witholding Tax is 7.29%...

~want or not ? good or not ? i dunno.. up to u ... haha but i will buy... SPSetia Eco city is under construction (just opposite MVC & MVCG) and MRT will stop there in the future too..
~The whole thing will take approximately 6months. So, if u buy... u'll have to wait for at least 6Months before u'll see any flowers and probably another 6Months to reap any fruits
~BTW, Kasset will be delisted when the whole exercies ends.

IGBReit
~Issued Fund Size upon listing RM3,400M. Approved Size: RM3,550M. (means they have option for pvt placement)
~Half yearly income distribution
~Gearing on listing will be 26% (limit is 50%). (I'll compare to Pav and Sunway gearing and update later)

Updated: Gearing Comparison for MReits (Jan2012)
Al-Aqar: 48.2
Boustead: 17.6
Arreit: 36.0
AmFirst: 39.8
Atrium: 24.5
Axis: 38.2
CMMT: 32.7
Hektar: 43.4
Quill: 36.4
Stareit: 11.5
Sunway: 35.0
Tower: 20.6
UOA: 38.2
Pavreit: 20.1
~~~~~~~~
IGBReit: 26%

So, IGBReit will be top 5 lowest gearing.. Stareit -> Pav -> Tower -> Atrium..
Also to consider is the occupancy rate, which is excellent and i believe most of the shops are doing ok. Anyone with knowledge of this please share.. thanks..

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Added on
plz correct me if i'm wrong...

This post has been edited by mopster: May 15 2012, 11:36 PM

Mid Valley - 100% occupied; Garden Malls - near 100%

Is that good or bad

Aiks moppy, looks like our calculation has some variants

===

For those who are asking me for the KrisAsset papers, here's it:


Attached File(s)
 KrisAssets___Announcement__11_May_2012.pdf ( 413.72k ) Number of downloads: 136

regarding the distribution of IGB REIT shares to krisassets shareholders, let say if someone got 500 shares then they only get between 2500-3500(based on the calculations given above)
wow nice i got a match order for krisassets haha! at quite a high price of 7.45 though

This post has been edited by ryan18: May 16 2012, 10:53 PM

RM7.45 is not high price.


~ MV Rental & Car Park Income: RM210.6 million per annum
~ GM Rental & Car Park Income: RM87.7 million per annum

3400million shares in the IGB Reit. 100% distribution until 31 Dec 2014.

By looking at these information, let say IGB Reit earns RM280mil from rental income next year. 280 / 3400 = RM 0.082.

RM7.45 is still lower price than RM1.00 in IGB Reit. Just to ask you whether have you seen CMMT or PAVREIT having >8.2% dividend yield? The IPO price is not yet set. The RM1 probably is the Par Value RM1.00 only.

News from The Star...

KUALA LUMPUR: Hektar Asset Management Sdn Bhd, the manager of Hektar Real Estate Investment Trust (Hektar REIT), has obtained the approval from the Securities Commission (SC) for the proposed fund size increase and to list the new units on the Main Market of Bursa Malaysia.

The approval was also given for the valuation of two retail properties in Kedah, to be acquired by Hektar REIT.

“The two properties are Landmark Central Shopping Centre and a major portion of Central Square Shopping Centre which are collectively valued at RM184mil,” Hektar Asset Management said in a statement yesterday.

With the approval, Hektar REIT is looking to increase its fund size by up to 93,858,773 units from 320,001,000 units to a maximum of 413,854,773 units, it said.


http://biz.thestar.com.my/news/story.asp?f...71&sec=business

What will be the impact with the increase in fund size

True i havent seen more than 7% for cmmt.yeah what i mean rather ex compared to dec level.should buy krisassets at that time instead of pavreit