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Hopefully not but it's honestly starting to look scary - especially if it continues to fall below 0.30. The share price now is either a gift or a warning.
Concessions are not affected by change in gov - only delays in rate hikes, e.g. toll hike (gov compensated Tali) & SWM rate revision. We had 5 different PMs from 2018-2022: no change. Concessions: water (extended 2022, expire 2036), highways (started 2007 & 2014, expire 2032 & 2045), SWM (expire 2033).
No buyback because they're already tight on cash and have to reduce dividends. Family not acquiring probably because LGB already owns 49.95% and risk triggering an MGO. Funds not buying because they can't wait for FY27. Retail probably not chasing because everyone's waiting for a lower price since the big seller is still selling. But obviously somebody saw value - that's why we saw that big off market trade in the last sell-down.
The price drop is again due to one big seller exiting - a fund has to show ROI and can't "wait" for FY27 like retail investors can. Your decision is simple... if you believe the dividend can go back up to 3 or 4 sen a year after Rasau, then the current price of 0.315 will give you a future dividend yield of 9.5% to 12.7%.
Actually, risk is low - water usage, highway usage and waste is more or less stable, regardless of economic conditions. Their solar farm income is fixed. FY25 FCF is 4.14 sen, which can comfortably cover the dividend. Once Rasau completes, FCF goes up and dividend should go back up - unless they take on another project. All you have to do is wait until Q2 FY27 (provided no more delays). The unknowns are increased energy cost, wage increase, EPF for foreigners and SWM rate revision.
Watch the announcements for shareholding change, if it's a major shareholder. Yesterday 10M shares done at 0.35 in a negotiated trade. This morning another 10M shares done at a higher price of 0.355.
11M shares transacted today - the bulk from a negotiated trade at 4:50pm and at the higher 0.35 price. Hopefully that's the big institutional seller offloading their remaining shares to a big buyer, which will mean the end of the current downtrend. Let's see tomorrow if the selling stops and daily volume drops significantly.
