Aspial

[port]

bought aspial in dec09, it starts showing some signs of upward activity this yr.

some financial ratios:-

net current asset value(ncav), working capital per share in 2009 and 2010: 41 ct( issued share,350m) & 34 ct(issued share,420m) resp.

debt/equity: 211/98=2.15x(2010), 146/97=1.51x(2009)

note that it raise 14m thro 1 for 5 rights issue at 21cts few mths back.

some pts to consider:
1. if aspial debt/equity ratio is so high, why did it not hv a 1 for 1 or 1 for 2 rights in the first place?
2. why r banks willing to extend loans for its prop. development after assessing its high debt ratios?
3.its rnav very likely much higher as it bought 93m of land in 2009 equiv to 63% of mkt cap of 147m

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assume prop sales of 480m to be recognise progessively over the next 4 yrs and a 20% net margin, ie 24m net profit/pa over the next 4 yrs.

PE based on enlarged 500m issued shares adjusted for bonus issue & curr price of 35ct: 7.3x

assume PE expand to 10x in future, target px: 48 cts