Kian Joo In Play

They kept it a good secret. Now its all out in the papers. What's the upside?

52 week High-Low: 1.71-0.98

Last Traded: 1.54

NTA: 1.46

ROA: 3.7%

Cash Flow Per Share: 10.7 sen

Share Capital: 442.2m

Par Value: 25 sen

Free Float: 34.4%

Major Shareholders: KJHSB 34.87%, EPF 13.97%

Debt/Equity: 21%

Business model still good. Absorbed newer canning technology (Microflex). Private equity firms very interested. One brother really wants to sell, the other kinda going along with it. May end up with a new buyer who will work alongside with one of the remaining See shareholder. Owns 54% of Box Pak. Stand alone bidder unlikely to bid past RM1.80. Buyers with synergies and existing big user will see very good returns. Cartons business very good in Vietnam, foothold there already.

I expect a bid of at least RM2.05 for a buyer with synergies. Chance to unlock values in Vietnam and also via Box Pak. As this will not be a G.O. exercise for new buyer, share price may not reach actual transacted price. Trade within the range of RM1.60-RM2.00.