Excerpts from Kim Eng Securities report this morning.
Kim Eng Securities analyst Pauline Lee says:
L-R: Bernard Lim, CEO, Design Studio, and Mohannad Sweid, CEO of Depa, in a 2008 photo when they formed a JV.
“Depa could increase its offer price by another 50% to 84 cents per share and still stay earnings accretive. This takes into consideration the fact that it is trading at a sharply higher PER compared to DS – 7.2x.
“In our view, Depa has to raise its offer price to gain control of this crown jewel. Maintain BUY and TP of 90 cents (7.5x FY10F PER).”
