Maybank IB upgrades Aeon, raises TP on asset revaluation

Maybank IB upgrades Aeon, raises TP on asset revaluation
Business & Markets 2013
Written by Fatin Rasyiqah Mustaza of theedgemalaysia.com
Monday, 25 March 2013 15:57


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KUALA LUMPUR (Mar 25): Maybank Investment Bank has upgraded AEON CO. (M) BHD [] to "hold" rating from "sell", with a higher target price of RM12.50 (from RM9.30), after its own revaluation of Aeon’s assets.

“Assuming the revaluation of its assets, we estimate a revalued net asset value (RNAV) per share of RM13.40 for AEON,” said the research house, after a recent briefing by the company.

The research house said of the 21 malls that AEON manages, 11 are owned and 10 are leased.

The 11 owned malls carry a total net leasable area of 4.3m sq ft which, based on current market values, are worth RM1.3 billion, compared to the book value of RM955 million as at end-2011.

According to the research house, AEON has RM600 million of tax credits and RM454 million cash at the end of 2012. By fully utilising the tax credit before its expiry by end-2013 means AEON could pay RM1.30 per share of special dividends.

“However, the flow up to AEON Co (Japan) would be just RM232 million, not significant against a net debt position of RM42 billion. As such, it may be in AEON’s interest to conserve its cash for future expansion instead,” said the research house.