The proposed dividend-in-specie distribution of PT Bank CIMB Niaga Tbk (Niaga) shares to CIMB Group Holdings Bhd’s shareholders translates to about 2 sen per CIMB Group share or a 0.5% yield, according to Maybank Investment Bank Research.
It said the dividend was in addition to the 4.1% that the research house was projecting for FY16.
“We estimate a marginal 1.2% reduction in FY17 group earnings stemming from the 5.4 percentage point decline in the group’s shareholding in Niaga to 92.5%. We maintain our ‘sell’ call with an unchanged target price of RM4.10 (FY17 price-to-book value (P/BV) of 0.8 times, 8.9% return on equity),” Maybank said.
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It said the dividend was in addition to the 4.1% that the research house was projecting for FY16.
“We estimate a marginal 1.2% reduction in FY17 group earnings stemming from the 5.4 percentage point decline in the group’s shareholding in Niaga to 92.5%. We maintain our ‘sell’ call with an unchanged target price of RM4.10 (FY17 price-to-book value (P/BV) of 0.8 times, 8.9% return on equity),” Maybank said.
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