High conviction Buy on Boustead

According to the Hwang DBS Vickers Research, it has a high conviction Buy on BOUSTEAD HOLDINGS BHD as the major rerating catalyst is in property The research house said on Tuesday, Nov 30 that Lembaga Tabung Angkatan Tentera (LTAT) is finalising two lucrative government land deals – (i) 60 acres of Jalan Cochrane land, and (ii) 245-acre Batu Cantonment army base in Jalan Ipoh.

“We estimate these projects could add RM2.05/share, raising our SOP value to RM10.35. This excludes its recent rights to reclaim valuable land in Penang.

“The recent RM1bn MTN program suggests these land deals are imminent. Valuations remain a bargain at 8x FY11F PE and 1.1x P/NTA, coupled with 6.0% yield,” it said. (Source: The Edge Financial Daily)