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SCG

1.90%

$3.61 scentre group

SCG Trading Under Bare Land Value, page-94

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teddy77

31 Posts.

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04/08/20

11:50

Post #: 46287402
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Originally posted by noomxx: ↑

Scentre Group gearing is quite high.
Unlike Vicinity, they have yet to do a capital raising.
If they do a capital raising, then that NTA will be crushed as the capital raising will be done at discount to current share price NOT NTA.
The increased shares on issue as a result of the capital raising will seriously dilute the NTA.

In addition any capital raise because of share dilution will seriously curtail future dividends compared to their historical amounts. So one cannot use historical dividends to predict future dividend yields (ie using historical dividend divided by current share price cannot be used)

Hence the market is not trusting that the current NTA will last, the market is anticipating a capital raise, and hence the market is trading accordingly.

So the key question:
Do you believe Scentre Group will do a capital raising?

Expand

To all those mentioning about Capital Raising, this is unlikely as they already raised capital recently.

$2.3 billion from notes on 22/05/2020, notes have a fixed rate around 4%+-

Why would they Capital raise when they already raised so much capital via notes using the proceeds to pay down existing debt, i presume they paid down the debt that was the most urgent and have converted a large chunk of debt to the above Notes with reasonable rates with long fixed interest periods.

Announcements - SCG Prices A$2.3bn equivalent Snr Guaranteed US$ 144A/Reg S

SCG Price at posting: $2.01 Sentiment: Buy Disclosure: Held
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