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Share price too expensive. If u minus Project Facilitation fee which is one off in nature, the net profit will only be RM 10 to 14 million. Using PE of 15, this company is worth at most RM 200 million, translated to share price, PTRANS fair value is only RM 0.32.
Project Facilitation fee won't last long, this share is actually very expensive.
SECOND, this company is paying much less tax than other companies because of tax incentives, which do not last forever. Without it, profit is much lower
Read the annual report and analyse the figures carefully. The terminal business is not a profitable business and offer a mediocre after tax return on capital. Heavy Capex and low returns are a bad combination. My FV for this company is only RM 0.45, which is actually quite high compared to its Adjusted Earnings per Share. I give it a premium because the moat for this business is strong.
There are 100 terminal owned by local council out there. I think project facilitation fee still able to sustain for several years.
Whether IPTT is profitable. Try look at profit margin of reits that collect rental and promotional fees which is more or less same as IPTT
Actually management has disclose PFF before. PFF is to redevelop the old bus terminal, whether ptrans own it after the renovation, or ptrans charges on the PFF fees.
I also watched the interview. The PFF is clearly not sustainable and the current earning is clearly not sustainable. Which means we cannot use current EPS to project its fair value. If you remove the PFF, the net profit is only RM 10 million.
SECOND, its current tax rate is too low and is not sustainable. When the reinvestment allowance runs out, it has to pay 24% tax rate. Its actual net profit therefore is only RM 7 million. At PE of 20 since this is its long run growth rate, the stock is only worth RM 140 million.
Don't jugde the price is expensive or not...for the good company...double or triple r normal...see some gloves company....even lose business also hit higher...
It is not about pandemic or not. It is expensive because the Project Facilitation Fee which comprises RM 29 million or almost 80% of the net profit is one off and is not sustainable. Plus, the tax rate is abnormally low because of incentives. If you remove the two unsustainable components, the net profit falls to RM 7 million ringgit. Which reflects the actual earning power of this company
Different player different perspective. PFF contributes to earnings and cash flows to the company, as well as lower tax payment. In fact, management can utilise the money to expand their business, like BIDOR and TRONOH terminal.
Remove PFF from 2015 to 2020, there was zero profit growth. PFF as of 2020 is RM 32 million clean profit, that is over its total net profit of RM 43 million for 2020. Just think
actually why keep mention PFF. how do u know is one off ? all the while there is PFF for years. Meanwhile, PFF also part of revenue, why have to remove.
I don’t understand, why u hard hard want to deduct PFF from its earnings. What the head? If you are sure that PTRANS is not going to benefit from recognition fees anymore then only u make justification.
"A copy of the FFA(Facilitation Fund Agreement) is available for inspection during the office hours from 9.00 a.m. to 5.00 p.m. from Monday to Friday (except for public holidays) at the registered office of PTRANS at D-3-7 Greentown Square, Jalan Dato’ Seri Ahmad Said, 30450 Ipoh, Perak Darul Ridzuan for a period of 3 months from the date of this announcement(5th April 2021)."
That's bullshit. The terminal biz has very low rental yield. You are essentially paying for bus terminal consultant business, not a profitable bus terminal business.
@Kings Trading My bad. I actually meant the whole IPTT is very profitable and i was confused about PFF with TMF. GL was right, it is all about the sustainability of the PFF.
well the qr is within my expectation as bus and petrol station biz only make a small contribution to the profit. It is quite misleading when everyone think ptrans is a bus operator like some other rubbish bus operators in the bursa. The only concern is how long can the current pff last and how soon can they replenish the order book, which i hv completely hv no idea.
steve, pff is something like the revenue from construction project. u lose the revenue once the project is finished unless u get another project. That's y order book is important.
Adama what baffles me is the they said the PFF is usually 2% of the bus terminal GDV. But they have recorded RM 30 million in PFF last year. Are they suggesting that two bus projects have RM 1.5 Billion in total GDV? I think it is very not clear where the money is exactly coming from. And the PFF is actually even higher this year.
Terminal Meru has recorded a flat RM 10 to 13 million since IPO from A&P and rental. But the construction cost is almost RM 200 over million, the ROI is stupidly low.
They have mentioned the PFF will peak 7 years later. I can't help but think the project they are talking about must be a huge bus station project, probably like Sunway BRT. I don't want to speculate but the only major ongoing bus project is in Johor
The A&P and rental combined is yielding only around 6% return on investment. Could be higher if we don't use the net profit, but the gross profit instead. Subsequent terminals will show the exact ROI. Difficult to assess the ROI for the first
Yes the PFF is from third party and it's getting higher every single year. They said it's 2~3% from the total project cost. But it is highly unlikely we have billions of bus terminal project every year. Even more expensive than building Airport
history has been proven that pff and revenue keep increase. so I have no worry on it's financial ability. Im just worry how and will they wan to move the share price up
Or could it be the GDV for project is not limited to the terminal itself only? but it is the amount of overall Mixed development eg:Kampar Putra sentral + shopping mall + hotel then the project value would be much bigger compared to bus terminal itself normally cost at around RM120mil
Kim, normally project that big will be reported by news. Based on last year PFF, the project value in 2020 itself has to be around 1.3b to 1.98b. Try compare to the total cost of terminal kampar abt 280m.
128m is the cost of terminal (The Edge). 284m is the total cost (Annual report key audit matters). FYI, cost of KLIA2 is around 4B. So the GDV of projects that they involved in past 3 years is about an international airport lol
Alright I will stop here. Remember these are merely discussion. Not a buy/sell call, I am not responsible for your investment decision and profit/loss. Good luck everyone
No, I am not joking. You said anything below RM0.98 is fine, you won't lose money. That's a buy call. No? Do you even have a license to issue such statement?
Based in the info from the latest investor briefing, the rm39m pff for FY20 was derived from 6 projects instead of one, which means each project has only average project development cost of rm260m. Now this value looks more reasonable.
IMO pff should be able to last for quite some time since government is still pushing for a better and modern bus terminal services and there r still many lousy old school bus terminal out there.
Currently order book of PFF can last for at least 1 year. Currently advise 5-6 terminals. That is just my thoughts after attending online sharing from company.
