Dari TA Securities ..
IHH Healthcare to Sustain Interest in the Market
As for the FBM KLCI, it may pause for profit-taking consolidation early this week after rising
for five straight sessions last week. Nonetheless, it is expected to continue registering gains
on a week-on-week basis due to buying support from local institutional funds later this
week, ahead of the impending listing of IHH Healthcare (Target Price RM3.33 based on CY13
PER of 30x). They had been supporting the market when foreigners turned net sellers in
June.
While the stock is expected do well upon listing due to its defensive business, global
exposure, expansion plans and its market capitalisation, the 60 times oversubscription by
institutional investors is an over-statement to gauge actual appetite. As institutional
investors do not have to impart with cash to register their interest, most funds overbid than
what they actually intended to subscribe as the allocation after price fixing takes into
account shares bid as a percentage of total shares bid. Of course, this is unfair compared to
disadvantaged retailers who have to fork out the actual amount of cash when expressing
their interest on top of the very little allocation set aside for them.
