"one of the share sale’s lead managers" handed out this information. I wonder who? I don't see anything on the Shuaa website, don't know about the other institutions. Anyway, we'll assume it's correct and see what we can figure out. The lead managers are
Deutsche Bank AG
Merrill Lynch International
Millennium Finance Corporation - part of Dubai Islamic Bank (DIB)
SHUAA Capital PSC (SHUAA)
Number of shares
Share price 16.33 dhs to raise 13 billion dhs = 796 million shares sold, but that's only 20% of DP World so total shares outstanding would be 3.98 billion. Let's say 4 billion (probably more realistic anyway). I presume the total number of shares was already set some time ago, I just can't find that information.
Net Profit estimates
2006 net profit AED 705 million
2007 net profit AED 1.3 billion (forecast)
2008 net profit AED 2 billion (forecast)
2009 net profit AED 2.3 billion (forecast)
2010 net profit AED 2.8 billion (forecast)
Calculations
Code:
Share price est 16.33
year 2006 2007 2008 2009 2010
net profit AED m 705 1300 2000 2300 2800
EPS stated $ 0.088 0.132 0.152
EPS stated AED 0.32 0.48 0.56
num shares billion 4 4 4 4 4
EPS calc AED 0.18 0.33 0.50 0.58 0.70
PE estimate 92.7 50.2 32.7 28.4 23.3
Hmmm. Either that share price is wrong, or there's an error in my calculations, or some information is wrong, or they look like expensive shares. It's not until 2009/2010 that the price starts to look close to reasonable. Still, at least profit growth estimates are much more promising than my earlier guess of 7%.
And if Return on Equity (ROE) is in single figures, then I can't see there will be much of a dividend yield.
I'm not sure about my Equity estimation - arrived at that figure from assuming that 16.33 dhs share price would be the par value. It's probably not but I don't know of a better number to use given the limited information available. Anyone care to suggest another figure?
And of course, equity will increase over time as profits are retained - but that will just make the ROE figures look worse.
Zawya Dow Jones 25 Oct 2007 wrote:
DP World IPO shares for Dhs 16.33 each
The shares of DP World are expected to be priced at Dh16.33 ($4.45) in the Middle East’s largest public issue that will raise $3.7 billion (Dh 13bn).
The port operator, the world’s fourth-largest, is expect to earn net profits of $789 million (Dh 2.8bn) by 2010, valuing the company at up to $22.9bn (Dh 84bn), according to the IPO data.
Shares in the company could sell at $4.45 (Dh 16.3) each, according to calculations based on data issued by one of the share sale’s lead managers to investors.
A spokesperson for DP World was unavailable for comment when called.
The value of the IPO could rise above $4.5bn (Dh 16.5bn) depending on the premium offered by investors on the 20 per cent stake that DP World is offering.
DP World announced on Sunday that it will sell shares worth at least $3.5bn (Dh 12.8bn) next month in what will be the Middle East’s largest initial public offering (IPO).The company is expected to earn $365m (Dh 1.3bn) this year, up from $192m (Dh 704.6m) last year, according to the pre-IPO information supplied to investors.
Earnings per share for the period are expected at $0.088, according to the research.
In 2008, the port operator’s net profit is expected to rise to $563m (Dh 2bn), with EPS at $0.132, rising to a net profit of $630m (Dh 2.3bn) and EPS of $0.152 in 2009.
The operator has not made its IPO prospectus public. The issue will open for retail buyers on November 4, closing November 15.
Institutional investors will be able to bid for shares up to November 21. The IPO is intended as a book-building issue, which allows the market to determine the price within a range.
DP World became the world’s fourth-largest port company after its acquisition of UK-based Peninsular and Oriental Steam Navigation Company (P & O) for $6.8bn (Dh 24.9bn) late 2005.
The investors are said to be keen on buying shares.
HHLA 2007 FY PE estimate = 24
Forth Ports (UK) 2007 PE estimate = 38
China Merchants Holdings (International) (China) 2007 PE estimate = 37
Shanghai International Port (Group) Co 2007 PE estimate = 58
DP World (UAE) 2007 PE estimate = 50 (sharewadi, not reuters)
So maybe my estimate of a 2007 PE of 50.2 doesn't look so high in the grand scheme of things. But then I think of all those DFM and ADSM stocks trading at PEs of less than 15... _________________ UAE IPO list | posting guidelines
I wonder if you could help in finding the below info:
1. DP world revenue\earning growth for the last 3 years.
2. the company Asset & Libability value
3. let say the it is priced at the upper end lets say 1.2 or 1.3 what will be the PE ratio in this case? and what does this mean?
4. what was the source of the forcasted profit figures
This topic may be out of date now that the DP World IPO prospectus is available. You'll find some information related to your Q1-3 there but they seem to have released limited information, also DP World was part of Dubai Ports Authority (DPA) until ... ah I can't find the date just now ... , so historical information is only included for DPA.
There's a more up to date topic on the DP World IPO pricing which was added after the prospectus came out - I answered your Q3 there.
Investor UAE wrote:
4. what was the source of the forcasted profit figures
Zawya Dow Jones 25 Oct 2007 wrote:
The company is expected to earn $365m (Dh 1.3bn) this year, up from $192m (Dh 704.6m) last year, according to the pre-IPO information supplied to investors.
Earnings per share for the period are expected at $0.088, according to the research.
In 2008, the port operator’s net profit is expected to rise to $563m (Dh 2bn), with EPS at $0.132, rising to a net profit of $630m (Dh 2.3bn) and EPS of $0.152 in 2009.
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