Finally, the ASTRO IPO is open for subscription! The subscription is starting today until 1st of October 5.00pm. The indicative price of ASTRO IPO is RM3.00, which is much lower than the initial indicative price that has been set for MITI investors previously (RM3.60). ASTRO is expected to be listed on Bursa on 19th October 2012.
Although RM3.00 looks more attractive compare with RM3.60, it is still quite expensive in terms of valuation. ASTRO now is offered at PE of around 26 times & dividend yield of almost 3% (75% payout). Anyway, with debt of RM3.66 billion & decreasing profit for the quarter end of April 2012 amid the strict challenges to ASTRO in the future. Also, there is no more monopoly for ASTRO since TM is started to enter the pay-TV market as well via its Hypp TV. I think the growth of subscribers for ASTRO will be going slow or flat in the future.
People will still go for ASTRO IPO because of wishing to make some fast money on the listing date of ASTRO. Anyway, I don't think ASTRO will be trading at very high premium upon listing, RM3.20-3.30 should be reasonable, just sell if the price goes beyond 3.30. It's good if you are 1 of the lucky guys who successfully subscribe ASTRO IPO, otherwise, try not consider to buy ASTRO at high price on the listing day, it is just a bit too high!
Note: The above content is just a blogging activity that purely share my investment thoughts & ideas and should not be used as recommendation to buy or sell any securities. I may already have position in the above securities. Any action that you take from the opinions or information of this blog is solely on your own responsibility. Please consult your investment advisor before you make any investment decision.
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