Fraser & Neave (F & N)

[weijian]

The P&P business has been talked about for the longest time. I reckon there are intangible benefits to the businessman who turns around a business, while ignoring the cold-hearted capital allocator.

Godfathers, regardless of nationality, are considerably asset gatherers. Do we expect any change in behavior anywhere else?

MINUTES OF THE 125TH ANNUAL GENERAL MEETING HELD ON WEDNESDAY, 24 JANUARY 2024 AT 9.30 A.M. AT GRAND BALLROOM, LEVEL 2, INTERCONTINENTAL SINGAPORE, 80 MIDDLE ROAD, SINGAPORE 188966

Mr Siew mentioned that although the P&P business had incurred losses, it remained financially independent of the Company, its parent company, and had not required funding injections. He added that the P&P business had been actively making independent, self-funded investments and was debt-free. Mr Siew expressed hope of returning capital to the Company and cautiously optimistic about opportunities that could lead the P&P business to profitability and growth.

Mr Hui responded that the P&P business, being a small part of the Group’s overall operations, should not be solely responsible for the low share price. He explained that the Company had undergone restructuring over the years, transitioning from a conglomerate to a more focused business. He assured shareholders that the Company actively assessed the suitability of each business to the Group. He asked shareholders to allow the Company time to grow the P&P business and unlock its full potential.

Mr Koh noted the concerns raised by shareholders regarding the P&P business. He assured shareholders that much work had been done to reorganise the business to improve performance in the future.

https://links.sgx.com/FileOpen/Minutes%2...eID=787322

[Curiousparty]

Guys, something intriguing caught my attention!

The Malaysia division listed on Bursa has surged to around $30, hitting approximately an 11 billion ringgit market cap. Singapore's F&N holds 55% of this Malaysian segment, which was estimated be around $1.7 billion in SGD.

Now, F&N's market cap is only $1.5 billion, which is lower than the Malaysia assets alone, not forgetting that F&N still possesses other assets. Currently, F&N offers around a 5% dividend yield and is trading at near all-time low prices. It certainly seems intriguing, doesn't it? Feel free to share your thoughts below! 😊

[money]

Guys, something intriguing caught my attention!

The Malaysia division listed on Bursa has surged to around $30, hitting approximately an 11 billion ringgit market cap. Singapore's F&N holds 55% of this Malaysian segment, which was estimated be around $1.7 billion in SGD.

Now, F&N's market cap is only $1.5 billion, which is lower than the Malaysia assets alone, not forgetting that F&N still possesses other assets. Currently, F&N offers around a 5% dividend yield and is trading at near all-time low prices. It certainly seems intriguing, doesn't it? Feel free to share your thoughts below! 😊

Never felt good about these integrated property counters including CLI and city development. They take on so much debt, they only shine, if ever, when interest rates are low.

[owq]

Guys, something intriguing caught my attention!

The Malaysia division listed on Bursa has surged to around $30, hitting approximately an 11 billion ringgit market cap. Singapore's F&N holds 55% of this Malaysian segment, which was estimated be around $1.7 billion in SGD.

Now, F&N's market cap is only $1.5 billion, which is lower than the Malaysia assets alone, not forgetting that F&N still possesses other assets. Currently, F&N offers around a 5% dividend yield and is trading at near all-time low prices. It certainly seems intriguing, doesn't it? Feel free to share your thoughts below! 😊

Never felt good about these integrated property counters including CLI and city development. They take on so much debt, they only shine, if ever, when interest rates are low.

Am I missing something? Frasers Property has already been spun off from F & N so I'm not sure how relevant that is

Anyway, I can think of some reasons why there is a big discount on the parent compared to the Bursa one: 1. the free float is only about 12% and company is tightly controlled 2. the P&P business is still making a loss and it is unknown when there will be a turnaround

Considering this, despite the discount, can the value of the parent be realised and would you rather buy the parent or the child?

[ghchua]

Hi weijian,

I thought we are talking about F&N here, a f&B company. When has this become a property developers topic? 

[ghchua]

Anyway, I can think of some reasons why there is a big discount on the parent compared to the Bursa one: 1. the free float is only about 12% and company is tightly controlled 2. the P&P business is still making a loss and it is unknown when there will be a turnaround

Considering this, despite the discount, can the value of the parent be realised and would you rather buy the parent or the child?

Hi owq,

I think another reason is that F&N's reporting currency is in Sing dollars, where the group's operations are majority in countries with depreciating currencies against Sing dollars.

Yes, Fraser & Neave Holdings Bhd share price might have done well, but the Malaysia currency did not.

There is always something known as holding company discount too, if investors feel that the chances of value being unlocked in the parent company is small.

[Big Toe]

There are quite a number of parent companies that have entire mkt cap lower than either their listed subsidiary or cash/near cash assets. In SG as well as in US. Plenty of bargains to be found. I myself doing some re-balancing to take advantge of this situation. (not vested in FnN though even though I wouldnt mind being vested, it was one of my first stock purchase more than 1/4 century ago.)

Unless economy nose dives, and a deep recession takes root for a prolonged period, I think holding some of these now would prove to be rewarding.

[weijian]

Hi weijian,

I thought we are talking about F&N here, a f&B company. When has this become a property developers topic? 

hi ghchua,
Thanks for the reminder. I have shifted the posts to CLI.

[Shiyi]

Liquidity of the stock could be another reason for the discount.
Public float of this company is only 12%.

[Curiousparty]

The publishing and printing business remains loss making, while the SG beverage business is not so positive. To be conservative i value all their other businesses as zero, only taking the 20% stake in vinamilk and 50% stake in F&N bursa to derive a nav per share of about $3.00

it seemed that whatever RNAV we assign F&N, Mr market is only assigning it at $1. With a decent yield of 5% now, hope no sudden rights issue like the case of Fraser Property.....