So Usaha Tegas wants to make a VGO on Maxis.
Let's see how much money Maxis generated this whole year.
Open their last report quarterly earnings, Quarterly rpt on consolidated results for the financial period ended 31/12/2006
If you add back the depreciation of 1.014 billion, Maxis operations generated 3.352 billion ringgit!!
My dearest Moo Moo Cow, consider that you have cash and you want an investment that can generate 3.352 Billion ringgit, how much do you reckon that you have to invest in a business that generates say 6%.
Is 6% a good return?
It's simple math. How much would you need to invest at 6% to generate a return of 3.352 billion? Answer? 3.352 divided by 6% = 55.4 billion!!
If someone offered you less, would you accept?
Recently there was an article on Star Bix, New chapter at Maxis.
This line is most interesting.
- To grow in India, Indonesia and locally in broadband and 3G, the funding requirements are huge, but that is not really an issue, said Jamaludin. This year alone, the company needs RM2.77bil (of which RM1.57bil is for India and RM1.2bil for Malaysia) and in India alone..
If you are a current shareholder of Maxis, your share of this 2.725 Billion has already being invested in India and Indonesia by Maxis.
How?
Should there be a value placed on these investments?
So how much does Usaha Tegas wants to offer you?
rgds
"p$$$$$t...p$$$$$tt" little bird told me that it is 20% premium of the last trading price!
ReplyDeleteHi Tucows,
ReplyDeleteAh yes, the premium would make it extremely interesting for the traders and I congratulate all the traders who has the hindsight to make this short term punt on Maxis but from an investing perspective, this 20% premium price is actually extremely disgusting from an investing perspective.
Me? I know Maxis is worth at least rm24.00.
Yes rm24.00.
Know anyone to seriously counter bid Usaha Tegas?
Btw, if Usaha Tegas feels that it is not getting a just market valuation for its share, there is so much Maxis can do for it's shareholders, like SHARING more of its dividends to the shareholders. I am praying for the integrity of the Bursa Stock market that Maxis do not de-list and list on a foreign exchange. The implications for the rest of the market would be extremely damaging. Which foreign fund would invest in our market if the investment grade stocks in our listing can list and de-list anyhow and anyway they like?
rgds
moola,
ReplyDeleteMaxis is a big fish in a small pond. Being a listed entity, it will be governed by boudaries that makes it undervalued.
For it to grow, its need to migrate to a bigger pond. India's venture will soon overtake Malaysia's. That time, you will see Maxis at same level with Vodafone / Telstra. To do that, they need to move out of its small pond now.
Hi tucows,
ReplyDeleteI know and understand your point. I really do.
Which is why i rate Maxis at least rm24.00.
So, is it the minority shareholders fault that Maxis is in the small pond?
So if Maxis wants to leave the pond, then Maxis should pay up!
rm24.00 my friend.
rgds