NADIBHD has 753 mil shares issued. Based on the director, the company's facility management services segment can double up its earning in after buying the 7 polytechnics. But before that, let us look at the business segment of Gagasan Nadi Cergas.

NADIBHD is an integrated building contractor with exposure on construction, property development, facility management services and utilities. The Group is supported by a construction orderbook of more than RM577m and tender book of RM1.4bn.

Now, let us focus in facility management services and utilities.

The Recurring Income Segment which consists of Concession & Facility Management and Utility Services, emerged as the next largest revenue contributor with 6.7% of the Group’s revenue, on 30.7% higher contribution of RM20.0 million from RM15.3 million a year ago. Signifcantly, the recurring income segment contributed 46.8% of the Group’s PBT for FY2018, an increase of 59.7% from RM13.4 million to RM21.4 million as a result of full year contribution from UTeM Concession income in addition to the existing IIUM Concession income.

https://www.theedgemarkets.com/article/gagasan-nadi-cergas-buy-hostel-asset-concessionaire-rm158m

Now, the company will buy 7 polytechnics from KPS. This deal shall be completed in Q1 2020.

Gagasan Nadi Cergas said the proposed acquisition allowed it to be entitled to the future cash flow streams from the seven concession agreements over the remaining tenure period, while allowing the group to extent its in-house facilities management services to the seven polytechnic hostels.

"The acquisition not only propels Gagasan Nadi Cergas to be a leading facilities management player in the tertiary hospitality segment, but also further strengthens our business model by making our profitability even more predictable for investors.

"Moreover, the new concessions on-board could potentially double up the earnings from our recurring income segment, complementing the anticipated growth from the construction business as well," said its group managing director Haji Wan Azman Wan Kamal in the statement.

I always like this kind of business, 20 years of hostel business. You no need to worry the income. the money will just come into your account unless the government bankrupt.

If now the earning is 13 mil, double means 26 mil. earning per share (EPS) from this segment alone is 26/753 =3.45sen. If calculate the other earning, most likely can earn 5 to 5.5 sen. Based of 27 sen, the PE will be around 4.9 to 5.4.

Based on 30% dividend policy and take 5 sen as EPS, you can get around 1.5 sen, is around 5.5%.

Anyway, above is just the estimation based on the words of NADIBHD group managing director, Haji Wan Azman Wan Kamal.

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