RHB offers Uniqlo, Toyota call warrants

RHB offers Uniqlo, Toyota call warrants
Business & Markets 2013
Written by Afiq Isa of theedgemalaysia.com
Thursday, 01 August 2013 10:04

KUALA LUMPUR: RHB Investment Bank Bhd (RHBIB) is offering new call warrants (CW) for Fast Retailing Co Ltd (Uniqlo) and Toyota Motor Corp, two Japan-listed companies with recognisable brands in Malaysia.

The two new call warrants, Uniqlo-C1 and Toyota-C6, will be listed on Bursa Malaysia today. The underlying shares for both CWs are listed on the Tokyo Stock Exchange.

According to RHBIB, the CWs offer investors an alternative opportunity to gain exposure to the performance of Uniqlo and Toyota shares. The two companies are also well-known names among Malaysian investors, it added.

RHBIB is currently the only issuer listing CWs on Japanese equities on the local stock exchange.

With a market capitalisation of ¥3,558 billion (RM118.1 million), Uniqlo operates a chain of clothing stores throughout Japan and overseas, including 10 outlets in Malaysia.

In the third quarter of 2013 financial year (3QFY13), Uniqlo reported cumulative gains in both sales and income generated from operations. Store sales increased by 20.5% year-on-year, while total sales including online proceeds rose 24.6%.

The retailer’s total international network had expanded by 135 stores over the past year to 410 stores in May. Uniqlo expects to open an additional 36 outlets by the end of August.

For conversion to underlying shares, Uniqlo-C1 has a ratio of 2,000 CWs per Uniqlo share with an exercise price of ¥35,000. The mother share was traded at ¥33,550 on Tuesday.

Automotive giant Toyota engages in the design, manufacture, assembly and sale of passenger vehicles. The company has substantial presence in Japan, North America, Europe and Asia.

The group’s consolidated vehicle sales globally increased by 1.52 million units to 8.87 million units in FY13, an increase of 20.7% compared with FY12.

Toyota-C6 has a ratio of 250 CWs per Toyota share with an exercise price of ¥6,500. Both CWs will expire in one year with a maturity date of July 31, 2014.

On Tuesday, the underlying Toyota share closed at ¥5,970.

According to Japanese investment bank Nomura, the outlook for Japan’s equities is positive as its stocks are once again trading at lower price-to-earnings ratios than US stocks.

With the continuation of Japan’s monetary stimulus initiatives, also known as “Abenomics”, it expects to see companies’ medium-term profit rates to increase by 10% to 15% in the coming years.

As the full impact of Abenomics on capital expenditure and household income has yet to be felt, the firm believes that there is still substantial investment opportunities in Japanese stocks. — by Afiq Isa



This article first appeared in The Edge Financial Daily, on August 01, 2013.

UNIQLO maybe can layan

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