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Last Friday, Coastal announced the ex-date for its 1-for-3 bonus issue which will fall on 14 July 2011. On this date, there will be about an additional 120.8m new shares being listed on the Bursa Malaysia which will total up its number of shares to 483.2m.
OUR TAKE
Bonus issue also comes with free warrant. This free warrant will be issued on the basis of 1 warrant for every 8 shares held after bonus issue. Hence, to simplify things, if an investor holds about 6 Coastal’s shares before the ex date, he will get additional 2 new Coastal shares and 1 free warrant.
Bonus issue also comes with free warrant. This free warrant will be issued on the basis of 1 warrant for every 8 shares held after bonus issue. Hence, to simplify things, if an investor holds about 6 Coastal’s shares before the ex date, he will get additional 2 new Coastal shares and 1 free warrant.
Maintain Buy. Coastal’s share price would be adjusted to RM2.67 on an ex-basis based on Friday’s closing while our fair value for Coastal would be adjusted to RM3.86 from RM5.15 now based on existing PER of 8x FY12 EPS as we incorporate in these additional bonus shares. We continue to like the company for its strong delivery track record which is supported by a strong orderbook of over RM700m and this should keep it busy over the next 12 months.