Our opinion on the current state of RMB

12 дек. 2023 г.

Rand Merchant Bank Holdings (RMH) is a company which used to own 34,1% of Firstrand and, since 2016, has been investing in property. RMBH was started 41 years ago by GT Ferriera, Laurie Dippenaar and Paul Harris and listed on the JSE in 1992 and split off and separately listed Rand Merchant Investment Holdings in 2011. RMH Property was formed with the acquisition of 27,5% of Atterbury, 34,1% of Propertuity and 40% of Genesis. Among the company's remaining assets is a 44% stake in Atterbury Europe which was associated with the Steinhoff meltdown. After the sale of its 34% stake in FNB, RMH is now essentially a property company. On 9th April 2021, the company announced a special dividend of 80c per share resulting from its failure to implement the Bucharest development. In its results for the year to 31st March 2023 the company reported revenue of R159m down from R629m and headline earnings per share (HEPS) of 11,6c compared with 4c in the previous period. The company's net asset value (NAV) was 100,3c per share. In a trading statement for the six months to 30th September 2023 the company estimated that its NAV would decline by between 52% and 60%. The company said, "...a special dividend of 141.67 cents per share was paid by RMH on the 10 October 2022. If the 30 September 2022 Net asset value is adjusted for the special dividend the benchmark will differ by less than 20%". Technically, the share the share is difficult to assess because of its recent divestments. On a P:E of 6,11 and in a rising trend, we think it represents good value at current levels.