In today’s briefing:
- IRC Limited (1029 HK): A Wide Spread as the Conditional Offer Opens
- Indocement Tunggal (INTP IJ) – A More Sustainable Cement Player
IRC Limited (1029 HK): A Wide Spread as the Conditional Offer Opens
- The Irc Ltd (1029 HK) IFA opines that a mandatory conditional offer from Nikolai Levitskii (Chairman and 30.61% shareholder) at HK$0.118 per share is fair and reasonable.
- The offer is open, with the first closing date of 12 January 2024. The offer is conditional on the offeror and concert parties representing more than 50% of voting rights.
- While the offer is light, satisfying the minimum acceptance condition is possible. The risk/reward profile is favourable as the upside (25.5% spread) outweighs the downside (5.3% to the undistributed price).
Indocement Tunggal (INTP IJ) – A More Sustainable Cement Player
- Indocement (INTP IJ) is trading close to 2-year lows, which seems unjustified given the ongoing recovery and a more positive outlook for FY2024.
- The company continues to grow its distribution reach to satisfy demand from IKN in Kalimantan, smelters in Sulawesi, and East Indonesia, with acquired Semen Grobogan feeding Central Java.
- Indocement (INTP IJ) continues to build on its sustainable credentials through the use of alternative fuels and reducing emissions and dust. Valauations are attractive trading on 6.8x FY2024E EV/EBITDA.
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