From KZ : Modernland Realty (MDLN.IJ, Buy): Modern Group to sell 5% stake.
Modern Group plans to sell 315m share, equivalent to a 5% stake in Modernland Realty (MDLN) to raise up to IDR302b (USD31m), through private placement. The offer price range is between IDR910-940/share.
Analyst Comment: Modern Group, through its subsidiary PT Bumi Perkasa Permai, owns 6.3% stake in MDLN.
The group owns few business sectors: convenience store (7 Eleven), property (MDLN), and Automotive.
On separate note, MDLN plans to issue USD150m global bond in 2H13. The proceeds will be used to finance land acquisition. Recall that MDLN is eyeing to acquire land in Bekasi, East Jakarta.
Moreover, MDLN is targeting to obtain 1,000ha of land bank in Cikande in the next three years to expand its industrial portfolio.
We expect MDLN to book a positive retained earnings starting this year, indicating an improvement and stability in the business. Reiterate BUY with a TP of IDR1,200/share, based on a 30% discount to our NAV estimates and pegged at 9.3x FY13F PER.
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