Frasers Property (formerly: Frasers Cpt (FCL))

[LionFlyer]

Hi guys,

I got 6 lots of FCL as a shareholder of F&N as well. As this is a distribution, I need to update my records (on my trading system, online portfolio and my spreadsheet) manually. What should I input as the "price" for my shares? Should I just use the cash equivalent of $2.01??

Edit:

Also, how should I correspondingly update my F&N price?

[toiletsiao]

i put 0.01 lol

[Boon]

Property arm of F&N down on debut

Rachel Scully

The Straits Times

Sunday, Jan 12, 2014


THE property arm of conglomerate Fraser & Neave (F&N) made a lacklustre trading debut yesterday after a rocky path to the stock market.

Shares in Frasers Centrepoint (FCL) slipped 12.5 cents or 7.8 per cent to close at $1.485 yesterday, giving it a market capitalisation of about $4.3 billion.

Almost five million shares changed hands for the real estate investment group, which was spun off from parent F&N, but not before a series of hiccups with disgruntled bondholders.

DMG & Partners analyst Goh Han Peng said the weak opening could be due to the bearish market sentiment towards real estate stocks: "Investors have been more cautious as the effects of the property cooling measures are starting to take effect in the local market.

"As FCL's listing was done by way of an introduction, there could also be some uncertainty over the fair value of the counter.

"Additionally, investors looking for pure food and beverage exposure could now sell their shares in the property spin-off while retaining the residual F&N shares."

Mr Goh noted that FCL's business is well diversified, with a good mix of commercial properties, serviced residences as well as returns from stakes in real estate investment trusts (Reits).

FCL's total assets were valued at around $10.5 billion as at Sept 30 last year, making it one of Singapore's largest property companies.

The listing was an important milestone after the unit had operated as F&N's subsidiary for more than two decades, FCL said in a statement yesterday.

FCL chief executive Lim Ee Seng said: "Besides having better corporate visibility, we will now have more flexibility to pursue our growth initiatives and strategies.

"We will also tap our controlling shareholder, TCC Group, (and its) network and expertise to explore opportunities and future collaboration."

FCL said earlier this year that Singapore will continue to be the company's home market but it is looking for opportunities in China, Australia and Thailand.

A previous Straits Times report stated that FCL was in talks to acquire and possibly manage TCC's 15 hotels outside of Thailand. Some of these properties could be injected into a hospitality Reit at some point.

F&N shareholders gave it the green light for the split last November, accepting the offer of two FCL shares for each F&N share they held.

TCC, which is owned by Thai tycoon Charoen Sirivadhanabhakdi, is FCL's controlling shareholder. Spinning off F&N's property arm has already unlocked value for its shareholders.

Bloomberg data showed that F&N shares closed at $6.38 on Dec 27 last year, the last trading day before the stock was split. F&N shares closed at $3.47 yesterday while FCL ended at $1.485.

As two FCL shares were given for each F&N share, an F&N investor with one share would have $6.44 of value at yesterday's closing prices, six cents higher than before the de-merger.

http://business.asiaone.com/news/propert...down-debut

(not vested)

[felixleong]

I read that FNN is now trading at around 30 times earnings.
I think after the split the market is now overvaluing FNN and undervaluing FCL.


Value investors looking to invest in the property sector could take a look at FCL. At 30% discount to book, it might be cheap.

Potential catalyst would be the listing of a hospitality reit.

Downside is also protected as a rights issue is not possible since its parent is in so much debt. Instead the opposite might be more likely, which is the sale of asset to pay out dividends to shareholders which helps pay down parent's debt.

Vested
Cheers ^^

[CityFarmer]

I read that FNN is now trading at around 30 times earnings.
I think after the split the market is now overvaluing FNN and undervaluing FCL.

The last closed price of F&N was $3.47, base on FY2013's PBIT of about $220 mil, i.e. 15 cents per share, the P/PBIT is around 23.

If the capital reduction of 42 cents is excluded from the market price, the P/PBIT is about 20.

Is F&N undervalue? I am not so sure...

(vested)

[felixleong]

I read that FNN is now trading at around 30 times earnings.
I think after the split the market is now overvaluing FNN and undervaluing FCL.

The last closed price of F&N was $3.47, base on FY2013's PBIT of about $220 mil, i.e. 15 cents per share, the P/PBIT is around 23.

If the capital reduction of 42 cents is excluded from the market price, the P/PBIT is about 20.

Is F&N undervalue? I am not so sure...

(vested)

I see thanks for the info, sorry my numbers may be wrong then.
I normally use net profits, don't really use PBIT.

As for valuing FNN it really depends on how you view it.

For myself I think at 30 times earnings it would be expensive,
but if its trading at 20 times or less earnings could be considered a buy given its strong business moat and growth potential.

[felixleong]

Comments from CLSA on Jan 2 report

"Post the split up of FNN’s property business, the current share price of
FNN is implying a trailing P/E of 30x and forward of 35x against peers at
25x and historical sector average of 16.4x. We acknowledge earnings
growth potential through synergies with Thaibev but see downside risk to
valuations for FNN in the near term as Myanmar legal suit and low
freefloat keeps a lid on share price performance. However, the yet to be
listed property arm, FCL is implying a deep discount at 53% to RNAV
versus sector average of 34% and CAPL/KPLD’s 44%/42% respectively."

Attached report on FNN and FCL

please feel free to take a look and comment
thanks ^^

[CityFarmer]

I read that FNN is now trading at around 30 times earnings.
I think after the split the market is now overvaluing FNN and undervaluing FCL.

The last closed price of F&N was $3.47, base on FY2013's PBIT of about $220 mil, i.e. 15 cents per share, the P/PBIT is around 23.

If the capital reduction of 42 cents is excluded from the market price, the P/PBIT is about 20.

Is F&N undervalue? I am not so sure...

(vested)

I see thanks for the info, sorry my numbers may be wrong then.
I normally use net profits, don't really use PBIT.

As for valuing FNN it really depends on how you view it.

For myself I think at 30 times earnings it would be expensive,
but if its trading at 20 times or less earnings could be considered a buy given its strong business moat and growth potential.

Since I don't have the reliable net profit of F&N ex-DIS, so I used PBIT instead. P/PBIT should be slightly lower than PE. I don't quite sure on the F&N core net profit of $138 mil used for PE derivation in the report.

[safetyfirst]

I also did my self calculation from the financial statement of F&N that ended 30 sep 2013, net profit of the various segments as follows for beverage, dairies, publishing, others respectively
51m, 29m, 3m, 53m all rounded off, F&N priced around 5000m now, my calculation of p/e is more than 30.
The figures are what the company calls attributable profits.

Even if you use pbit followed by a 20% tax, the p/e is also around 30.

Unless you are very confident of the prospects of F&N, it is very hard to demand a margin of safety.

[felixleong]

I also did my self calculation from the financial statement of F&N that ended 30 sep 2013, net profit of the various segments as follows for beverage, dairies, publishing, others respectively
51m, 29m, 3m, 53m all rounded up, F&N priced around 5000m now, my calculation of p/e is more than 30.

Unless you are very confident of the prospects of F&N, it is very hard to demand a margin of safety.

Thanks for the info.
Yeah I also agree that at over 30 times earnings, there might be little to no margin of safety. Maybe that's why I'm looking at FCL instead, and whether it can unlock value for shareholders or not. Also its now CD status, with 1.7 cents (about 1% yield) coming in feb. First time I see a new stock so fast give dividends ^^
I do hope FCL will be able to provide a yield of 4-5% for the year of 2014. Lets see how it goes