Wednesday 2 July 2014

KSENG beneficiary of Pengerang story?

At current price of RM6.78, KSENG's market cap is RM2.45b. Deducting cash and investment securities of RM969.9m and RM426.9m respectively, and with negligible debt, the market values KSENG at RM1.05b for its manufacturing, hotel and resorts, property, plantation businesses and assets such as investment properties and land bank.

If you believe in Pengerang's growth story, I think it is worth while looking deeper into the stock. Currently I believe the stock is already traded at some discount to its NAV. If Pengerang develops as planned, I think huge potential in its close to 9000 acres of land located between Pasir Gudang and Pengerang.

Its landbanks are located near the Senai-Desaru which may provide good accessibility to the highway. Well connected to Pasir Gudang as well.

Another big catalyst could be the proposed 3rd link between Johor and Singapore, if it is links Pengerang and Pasir Ris, as part of the proposed East Coast-Singapore expressway. Then we are likely to see the surge in land price in South-Western Johor repeating at Pengerang, Pasir Gudang and Ulu Tiram area.

 I couldn't resist but accumulating the stock at this level. I believe patience in this stock will be well-rewarded

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