Lim & Tan Securities Daily Review | 28 March 2025

Sinarmas Land Receives Buyout Offer at 13% Premium, Shareholders Advised to Hold

Sinarmas Land, a prominent real estate developer in Singapore, has received an unconditional cash offer from Lyon Investments, an entity controlled by the Widjaja family, to acquire all outstanding shares at S$0.31 per share. This offer represents a 13% premium over the stock’s recent trading price.

Rationale for the Offer

The offeror currently owns 70.3% of Sinarmas Land’s total issued shares and believes the offer provides shareholders an opportunity to realize their investments at a price that may not be readily available due to the company’s low trading liquidity.
The offeror intends to delist Sinarmas Land from the Singapore Exchange and make it a wholly-owned subsidiary, citing the potential benefits of greater management flexibility, optimized use of resources, and easier implementation of operational changes without the costs and regulatory requirements associated with a public listing.

Lim & Tan Securities’ Recommendation

Given the relatively low offer price and the fact that the offer is not final, Lim & Tan Securities advises shareholders to “HOLD” their shares and “NOT ACCEPT” the unconditional offer.
The research team believes the offer undervalues Sinarmas Land, which is currently trading at 0.4x price-to-book, and that shareholders should hold on to their shares to potentially benefit from the company’s future growth and development.

Geo Energy Resources Expands Stake in Key Coal Asset

Geo Energy Resources, a leading coal producer, has announced the acquisition of an additional 15% effective interest in its PT Triaryani (TRA) coal mine for US$40.8 million, increasing its total effective interest to approximately 75.07%.
TRA’s producing coal mine has low sulfur and ash content, which is in high demand from both domestic and international markets, particularly in Asia, and commands a premium above the coal market index price.
Based on an independent report, TRA’s coal reserves stand at 274 million tonnes as of December 2023, with plans to increase this to over 300 million tonnes through additional drilling and exploration.

Expanding Production and Infrastructure

Geo Energy is planning to ramp up TRA’s annual production to 25 million tonnes after the completion of its Integrated Infrastructure project.
The company has also entered into non-binding term sheets with two major mining groups for the usage of its infrastructure, representing significant commitments and supporting Geo Energy’s infrastructure monetization strategy.
Additionally, Geo Energy has signed a non-binding MOU with Resource Invest AG, a leading commodities investment company, for a potential investment of US$50-100 million in Geo Energy’s MBJ subsidiary, which is developing the Integrated Infrastructure project.

Analyst Outlook

At the current share price of 32.5 cents, Geo Energy is trading at an undemanding forward consensus P/E ratio of 4-5x and a price-to-book ratio of 0.7x, with a dividend yield of 3%.
Lim & Tan Securities believes an “Accumulate” recommendation is justified, given the company’s expected earnings and dividend growth trajectory, as well as the potential re-rating catalyst from the validation of its new road infrastructure project.
The research team’s 1-year target price for Geo Energy is 64 cents, nearly double the current share price.

Macro Insights: Slowing US Economy, Opportunities in Retail Real Estate

BCA Research’s analysis of the latest Federal Reserve Beige Book suggests a slowing US economy, with a moderating labor market and rising price pressures.
While employment remains healthy, respondents reported easing wage pressures, and consumption was softer as consumers become more price-sensitive.
BCA Research sees retail real estate as a contrarian opportunity, with investor sentiment at rock-bottom levels despite shifting consumption patterns and favorable supply-demand dynamics.

Key Transactions and Dividends

The report covers recent share transactions by company insiders and major shareholders, as well as upcoming dividend payments for various SGX-listed companies.