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A. The company’s issued share capital will be reduced from RM885.2m → RM285.2m after the exercise.
Thus, post‑reduction total equity ≈
Issued Capital (RM285.2m) + Retained Earnings (RM404.3m)
= RM689.5 million
B. Total Number of Shares
Following the most recent RCPS conversion (Jan 2026):
Total shares outstanding = 2,227,610,641 shares
C. Compute BVPS
BVPS=Total Equity/Shares Outstanding
BVPS=689,500,000/2,227,610,641≈RM0.3094
Post‑Capital‑Reduction Book Value Per Share ≈ RM0.31
This is important because market price (recent: RM0.165–0.17 range) is trading well below this estimated book value, implying a substantial discount to cleaned‑up equity.
Here are the key positive impacts of this capital reduction exercise:
· Financial & Accounting Impact: The company will eliminate RM195.36 million in accumulated losses. Post-exercise, it will have positive retained earnings (RM26.3 million at the company level and RM404.3 million at the group level), making the financial health look much stronger on paper .
· Dividend Potential: Before this, Perdana couldn't pay dividends due to accumulated losses. By clearing the deficit and creating positive retained earnings, the company enhances its ability to pay dividends to shareholders in the future .
· Corporate Perception: Management expects this to strengthen credibility with customers, financiers, and investors. It realigns the issued share capital with the company's actual financial position, which may improve access to financing for growth initiatives .
· Share Price Impact: There is no direct impact, but the market's perception of a healthier balance sheet and future dividend prospects could influence the share price over time.
· Operational Impact: None directly. The company continues its offshore marine services business as usual. This exercise fixes the past (losses) but doesn't change current operations or contracts .
Glove stocks are cyclical. The market sometimes prices the rebound 12–18 months early.
Since earnings expected to recover FY27, the “value window” may close in FY26.
If your horizon is long (2026–2029):
Buying at RM0.80–0.95 may still deliver strong multi‑year upside
But buying below RM0.70 offers a much better margin of safety
1. Cyclical base effects: The glove cycle is normalising from a depressed earnings base; single‑year growth rates can look optically high and may not be sustainable. The Star/Phillip Capital note underscores recovery timing (FY27) but also continued pricing pressure near term.
2. Yield term is nil right now: Lynch’s PEGY variant gives some credit for dividends; with ~0% TTM yield, there’s no uplift to fair value from income at present.
3. Use multiple lenses: Lynch FV is a “heuristic”. Cross‑check with other methods (e.g., normalised P/E on mid‑cycle EPS, EV/EBITDA on FY27–28E, or DCF) before making decisions. (ValueSense and StableBread both present it as a quick screen, not a standalone intrinsic value.)
Harta will be my barometer of patience to transfer money from the impatient to the patient. In stock market, picking the under value stock is an art then you sit the ass out for money is make in the waiting not frequent trading
Warren Buffet’s 4 financial ratios he checks before every investment. The thresholds are:
ROE >15%, Debt/Equity <0.5, Current Ratio >1.5, Operating or Profit Margin >15%.
Comparing Hartalega and Intco
Sources and dates used:
Hartalega (HARTA, KLSE:5168): Latest quarterly report for FPE 31 Dec 2025 (Q3 FY2026), released 10 Feb 2026. I pulled revenue, operating profit, net profit, equity, debt, current assets & liabilities directly from the QR. [docs.publicnow.com],[marketscreener.com]
INTCO Medical (SHE:300677): Latest TTM/ratio set as of Feb 2026 (ROE, D/E, current ratio) from S&P/StockAnalysis; margins corroborated with Yahoo Finance TTM line items. (INTCO’s next formal 2025 results are guided for Apr 24, 2026, so TTM is the freshest consolidated view now.) [stockanalysis.com],[finance.yahoo.com],[simplywall.st]
Computation:
Hartalega (QR for FPE 31 Dec 2025, released 10 Feb 2026)
Interpretation: Hartalega’s balance sheet is extremely strong (nearly net-cash, very high liquidity), but current profitability is thin, so it fails the ROE and margin hurdles for now. [docs.publicnow.com]
INTCO Medical (latest TTM/ratios as of Feb 2026; quarterly detail pending next filing):
ROE: 9.84% TTM (S&P/StockAnalysis). [stockanalysis.com]
Debt/Equity: 0.96× (S&P/StockAnalysis). [stockanalysis.com]
Current ratio: 1.34× (S&P/StockAnalysis). [stockanalysis.com]
Operating margin (TTM): Operating income 1,089,361 / Revenue 9,849,586 ≈ 11.1% (Yahoo Finance). [finance.yahoo.com]
Net margin (TTM): Net income 1,702,420 / Revenue 9,849,586 ≈ 17.3% (Yahoo Finance). [finance.yahoo.com]
Interpretation: INTCO shows healthy net margin TTM but carries meaningful leverage and a sub‑1.5 current ratio, so it does not clear the D/E and liquidity bars. [stockanalysis.com]
In conclusion, bottom line vs the thresholds between Hartalega and Intco,
Hartalega:
Pass → Debt/Equity, Current Ratio
Fail → ROE 15%, Operating/Net margin 15% (at Q3 run‑rate) [docs.publicnow.com]
