Basically at $1.65 the shares are being priced for a 1 for 1 equity raising @ $1 and a 40% writedown in asset values
Here are how the figures were derived after much discussion
the basic premise is that "a REIT trading below its per share book value is essentially trading at a discount." from Value Investing for Dummies p318
I think for most part property valuations are based on discounted cash flow so the valuation of asset is equal
no of shares = 2,199,133,940 NTA = $3.86
Equity = $8,488,657,008 a decline in assets will be reflected in similar decline in equity 40% of equity = $3,395,462,803
Equity value after a 40% in asset values = $5,093,194,205
After a 1 for 1 equity raising @$1 GPT would be worth
$5,093,194,205 plus new equity ($2,199,133,940) $7,292,328,145 New number of shares = 4,398,267,880
NTA after a 40% decline in asset values = $1.658
a 50% decline in asset values plus a 1 for 1 equity raising @ $1 would work out as follows
equity = $4,244,328,567 add in the new equity from the raising $6,443,462,507
NTA = $1.465
so the way it is being valued at the moment the market is expecting a fall in asset values of between 40% and 50% plus an equity raising of 1 for 1 @ $1
GPT Price at posting:
0.0¢ Sentiment: None Disclosure: Held
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