Hi Geo,
Actually you look at the borrowing section of the MIIF FY13, it is zero already. The balance sheet in FY14 it does not have any borrowing in the column.
The EV calculation is meaningless to me. As it should be consider the taking over value, but it take the proportionate operational business net debt, which is belong to HNE and not liable to MIIF which defeat the purposed of EV intention. And it state very clearly in the financial report that the net debt is non-recourse to MIIF, thus what the point of having that in the EV calculation.
And for non-recourse debt usually it is only at 50~60% of the pledge property, thus for the Net Debt of 359m, does it means that the HNE value should be around 600m for the collateration, Is there a undervaluation when the HNE valuation is only 120m for the 81% ownership?
Last edit: 9 years 9 months ago by cheongsl. Reason: remove personal comment
There a possibility. But there can also be a possibility miif overpay for the asset. Need to dig up the historical record to find out if it is under or over. And can also look at china merchants expressway as a guide on valuation.
MIIF purchased the HNE in 2008 with 3,957m RMB for the 81%ownership, actually in 2011 there is an intention from GZ government to purchase back HNE with 7,000m RMB in 2011, but in the end did not proceed.
As for how much does it worth now is really a ??
