RJT does not have loan assets on its balance sheet like RAT& REU. REU has recently sold part of the loan at 30% discount below its book value.
Japan property prices have dropped more than a decade. There is not much room for any significant downward movment.This is opposite to US and Europe where property prices gone up a lot for the past few years
To justify at the current price 9c, RJT's whole property portfolio has to drop 25%. This is only likely in case of immediate fire sale.
Immediate fire sale very unlikely. The reason to cause all these fuzz is RJT was unbale to pay margin call under the NAB currency hedge agreement. Both parties have since reached standstill agreement. Given the recent strength of AUD against Yen, the hedge could easily be unwound.
AUD$150m of the loan liability payable within one yr. By allowing even a 30% discount upon sale of assets to pay down this loan, around AUD$70m will be lost. This is not a very material to AUD$1.4 bil of its assets.
The only thing RJT share with RAT and REU is its name.
RJT Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
