No cash is needed for the conversion of ICULS. Temasek already paid RM135m for the ICULS, the ICULS can be redeemed at RM2.1 ICULS nominal value for each SAM share. RM2.1 refers to the amount Temasek already paid so there is no cash injection. Please refer to the announcement on 24/8/2012 for ICULS details.
Soojinhou. You are right. My mistake. ....anyway, with RM 170 million in the bank, paying 50 cents dividend is not an issue to SAM since it requires RM 45 million only for the payout.
Loan stock entiltles a much lower dividend compared to mother share. So as a sound investor, Temasek would definitely take this step to have more profit to the holding company. No doubt, the number of shares increases and will cause a dilution in EPS, but if they make good use of the injected fund to execute their business plans, the dilution will only be temporary.
Dividend is more appealing than interest earned from iculs in SAM case. No point holding iculs since the default risks is very low until the expiry conversion date. Temasek won‘t be able to enjoy higher returns when the company has announced higher dividends.
we usually take diluted EPS to work out PER for conservative reason. It doesn't matter whether the holders of iCULs convert or let it stay until the expiry date.
I am still blur on how the presence of Temasek and with them converting their ICULS to mother shares will benefit us. Can someone pls explain in lay terms ?
Temasek's ICULS conversion is not beneficial to us shareholders - this dilutes the dividend per share. But luckily, according to the Star article, there is higher profit this year to give higher dividend than last year, maybe 40 sen even though larger share base. If not for the ICULS conversion, we could be getting 64 sen.
How to make money from stock market if one can't even handle a minor correction from an uptrend stock with good FA? Need to pay more tuition fees for learning...
(2) SAM is trading at 13x earnings via-a-vis PEG of 0.85.
(3) It's business of manufacturing aircraft components provides the company with a wide moat as the quality of products are very high. These aircraft parts have to be of the highest quality. Berkshire Hathaway bought over Precision Castparts recently. Precision is in the same business as SAM.
(4) SAM has a RM3.5bil order book (as per article in Edge Daily). This should place SAM on a sound footing.
(2) SAM is trading at 13x earnings via-a-vis PEG of 0.85.
(3) It's business of manufacturing aircraft components provides the company with a wide moat as the quality of products are very high. These aircraft parts have to be of the highest quality. Berkshire Hathaway bought over Precision Castparts recently. Precision is in the same business as SAM.
(4) SAM has a RM3.5bil order book (as per article in Edge Daily). This should place SAM on a sound footing.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
optimus9199
2,794 posts
Posted by optimus9199 > 2016-05-30 23:05 | Report Abuse
June will give special dividend