Raffles Education Corporated rated 'buy' by Maybank-Kim Eng

Stock Name: Raffles Edu
Company Name: RAFFLES EDUCATION CORP LTD

Research House: Kim Eng

Price Call: BUY

Target Price: 0.65

Maybank-Kim Eng Research in a Feb 9 research report says: "Stripping out the one-off gain of $9.0 million from the disposal of available-for-sale financial assets, Raffles Education Corp's (REC) 2QFY Jun12 results were slightly below our expectations.

"Net profit fell by 10% y-o-y to $3.5 million, dragged down by other operating costs arising from property and land use tax expenses of $2.2 million during the quarter. Despite the uninspiring results, interim dividend per share was raised to 0.5 cents from 0.45 cents last year. Turnover grew by 14% y-o-y in Asia Pacific (ex-China) to $16.7 million, accounting for 45% of the group's overall revenue.

"The stock currently trades near its NTA per share of 51 cents, suggesting that investors are getting REC's education business at a steal. We lower our SOTP-based target price to 65 cents, from 80 cents. MAINTAIN BUY."

Raffles Education Corp rated 'buy' by Kim Eng

Stock Name: Raffles Edu
Company Name: RAFFLES EDUCATION CORP LTD

Research House: Kim Eng

Price Call: BUY

Target Price: 0.80

Kim Eng Research in an Aug 25 research report says: "Excluding exceptional items such as forex loss, fair value gain and tax on revaluation, Raffles Education's 4QFY Jun11 results were largely in line with our expectation.

"On a full-year basis, we estimate its core profit from the education business to be about $21.8 million (-40.4% y-o-y). In any case, we believe the market has already discounted the uninspiring FY Jun11 results. The group has proposed a final dividend of 0.45 cents (total payout of 0.90 cents per share for the whole year), which translates to an annualised yield of 2.1%.

"Sum-of-the-part-based target price of 80 cents. Near-term re-rating catalysts include successful monetisation of OUC and faster-than-expected recovery in student numbers. MAINTAIN BUY."

Raffles Education Corporation rated 'buy' by Kim Eng

Stock Name: Raffles Edu
Company Name: RAFFLES EDUCATION CORP LTD

Research House: Kim Eng

Price Call: BUY

Target Price: 0.80

Kim Eng Research in an Aug 1 research report says: "The key issues raised during the non-deal roadshow were nothing new, mainly pertaining to dwindling student numbers, Khazanah's interest in Oriental University City (OUC) and REC's China real estate plans.

"We reckon most of these concerns have already been addressed in our earlier reports. While the near-term outlook remains a challenge in China, management is optimistic that positive contribution from its new colleges set up in the past two years or so should help to provide a turnaround in its bottomline.

"REC's share price has recovered almost 28% since our last update on July 5. Despite the uninspiring results expected of FY Jun11, we believe the group will still pay a DPS of 0.45 cents after the 3-to-1 share consolidation exercise. SOTP-based target price of 80 cents. MAINTAIN BUY."

Raffles Education Corporation upgraded to 'hold' by DBS

Stock Name: Raffles Edu
Company Name: RAFFLES EDUCATION CORP LTD

Research House: DBS Vickers

Price Call: HOLD

Target Price: 0.52

DBS Vickers Securities in a June 27 research report says: "Raffles Ed has entered into a Sales & Purchase agreement to sell 50% of a subsidiary, Value Vantage Pte Ltd, for S$46m. We understand that the sale will have no impact on its NES education operations in Shanghai, China.

"We are not surprised by this move and view this as mildly positive, as management has previously indicated its desire to "unlock" the value of its real estate to complement its anemic education business growth. We trimmed our forecasts by c.11-12% to factor in FX losses in FY11F and lower enrollment arising from the fall in Gao Kao takers in FY12/13F.

"Consequently, our SOP-based target price is lowered marginally to 52 cents (58 cents previously). After c.30% decline in share price post its dismal 3Q results, the counter now looks oversold at 0.7x P/BV. UPGRADE TO HOLD."