NST

NST ended the a.m. session at RM2.39. We have received questions from fund managers/analysts whether this means that the stock is already fairly valued?



We highlight that based on our fair value estimate of RM2.35/share for NST (revised in our report today) and special tax-exempt DPS of 40 sen, the stock still offers a potential total return of 15% at current levels. Alternatively, we think NSTP could potentially trade up to a cum-dividend price of RM2.75.



In addition, based on the earlier 1-for-1 share swap ratio, where the reference price for the Media Prima share was set at RM2.00/share, this (RM2.00) appeared to have set a benchmark-level for the stock. With the share swap ratio revised to 1.2:1, we think the new benchmark price for NST could potentially be RM2.40, ex-dividend.