LionDiv latest move to segregate it's retail biz (Parkson China, M'sia & Vietnam) & other biz (Steel, Property, Computer etc) into 2 listed company is long anticipated & wellcome by small shareholders.
This will unlock the value in the group, the Company existing share price of below 5.00 is under value mostly due to most investor ignore the Company's other assets & only focus on Parkson HK.. Even Parkson HK Biz by itself will justified for valuation of 5.00 base on the existing share price of HK28.50.
For those investors who critisies Lion Group for never benefited the small shareholder can smile now, the latest restructuring excersise to inject Parkson's retail biz into ACB & distribute all the ACB shares to LionDiv's shareholder will enable the shareholders to hold 2 listed companies shares (Liondiv & ACB, after restructuring) instead of only one now (Liondiv).
After restructuring, it is most likely Liondiv will hold biz in Steel, Properties, Computer and CASH RICH. It has the capabilities to grow the existing biz to new height with cash in hand.
On ACB, the Parkson HK is the main assets, other biz like Parkson Malaysia, Vietnam will made the valuation higher.
In short, before restructuring it's 1+1=1, after restructuring it will be 1+1=3.
I will not sell it below RM7.00, how about you ?
2 comments:
Interesting... but how did you arrive at the valuation of RM7.00?
Now based on HKD price may not be accurate as we all know that Hang Seng is also subject to share price manipulation.
Also, you ve mentioned that LionDiv will be spinning off the Parkson retail division and left with others and be cash rich. Whether it can use the cash wisely and grow the existing businesses into new heights remains to be seen. We will never know if suddenly they decided to venture into a totally unrelated business which they have no experience in - though the chances of this happening is small.
As a fellow accountant as well, I prefer the Prudence Concept of Wait and See. In addition, my investing style is more of a hybrid - fundamentals and technicals. So for now, I am not keeping any LionDiv. Maybe later will reenter depending on the charts.
I'm a subscriber of Icapital, he has use PE of 22 to value Liondiv at RM7.00-8.00 just on Parkson assets only. ( not inculed the valuation for others assets in Liondiv.)
I'm also impressed by the strong growth of parkson's earning. from Investor's point of view, I will not sell it if 'The Mkt' only offer me the fair value.
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