Heartland Boy

Seriously Singaporean Financial Literacy

MENUMENU
  • About
  • Investment
    • Investment
      • REITS
      • Singapore Stocks
      • Singapore Property
      • Cryptocurrency
    • review-of-dividend-machines-by-the-fifth-person

      Review of Dividend Machines By The Fifth Person

      February 22, 2021 By Alison_Liew 7 Comments

    • performance-review-2022

      Heartland Boy 2022 Investment Performance Review

      posted in Investment, Singapore Stocks

    • hdb-bto-and-hdb-resale-prices-have-increased-are-they-still-affordable

      HDB BTO and HDB resale prices have increased, are they still affordable?

      posted in Investment, Singapore Property

  • Banking & Insurance
    • Banking & Insurance
      • Bank Deposits
      • Bank Loans
      • Credit Card
      • Insurance
    • review-gxs-bank-trust-bank

      Review of GXS bank and Trust bank Savings Accounts

      posted in Bank Deposits, Banking & Insurance

    • review-instarem-amaze-card-foreign-currency-fee-cashback

      Review of Instarem amaze Card: Avoid foreign currency fees, receive additional cashback

      posted in Banking & Insurance, Credit Card

    • Great-SP-10

      Review of Great Eastern’s GREAT SP Series 10 – Guaranteed 4% Return!

      posted in Banking & Insurance, Insurance

  • Retirement
    • Retirement
      • Singapore CPF
      • Singapore SRS
      • Taxes
    • Why I invested my CPF OA funds in OCBC fixed deposit at 3.55%

      posted in Retirement, Singapore CPF

    • invest srs

      Why Invest Your SRS Funds In ETF

      posted in Retirement, Singapore SRS

    • gst-increase

      Beat The GST Sales Campaigns Brought Out Some Irrational Financial Decisions

      January 29, 2023 By Alison_Liew Leave a Comment

  • Lifestyle
    • Lifestyle
      • Dining
      • Travel
      • Parenthood
      • Wedding
      • Others
    • review-of-mealpal-singapore-that-now-serves-hawker-food

      Review of MealPal Singapore That Now Serves Hawker Food

      posted in Dining, Lifestyle

    • My family holiday to Australia’s Brisbane, Gold Coast and Sunshine Coast

      posted in Lifestyle, Travel

    • how-much-my-family-saves-in-transport-costs-from-cycling

      How Much My Family Saves In Transport Costs From Cycling

      posted in Lifestyle, Parenthood

  • Resources
  • Contact

Investment Singapore Stocks

Merger and Acquisition Event for Innovalues

innovaluesInnovalues Reached Heartland Boy’s Target Price

Innovalues has been on a tear ever since it announced on 7 April 2016 that it had appointed Rippledot Capital Advisors to “conduct a review of strategic options with a view of enhancing and unlocking shareholder value”. On 18 April, Innovalues exceeded Heartland Boy’s target price of $1.03 when he purchased it in late Dec 2015. (For readers who are interested, they can read Heartland Boy’s initiation report on Innovalues written this January here)

Innovalues chart on 21 April 2016

Diagram 1: Innovalues has surged 36% since Heartland Boy bought it on 29 Dec 2015

However, after the announcement of Innovalues’s full year results in February 2016, Heartland Boy re-evaluated and raised his target price to $1.11. At the current price of $1.08, Heartland Boy thinks that his revised target price might be breached in no time. It is also worthy to note that $1.08 had already exceeded the price targets that all the analysts had set.

What UOB Kay Hian Thinks of Innovalues

Interestingly, UOB Kay Hian has set a target price of $1.22 if a Merger and Acquisition (M&A) event occurs. UOB Kay Hian justified this by comparing against IPE Group (listed in Hong Kong) that was acquired at a trailing PE of 17.4x. Based on its FY15 results, UOB Kay Hian’s target price of $1.22 would translate into a Price/Book ratio of 4.8, a Price/Earnings ratio of 17.2. Is a M&A event likely to happen to Innovalues?

Does Heartland Boy Think a Merger and Acquisition Event Would Happen to Innovalues?

To assess the likelihood of a M&A event occurrence, it is best to take a quick glance at the health of the automobile industry which Innovalues operates in.

  • Motor Intelligence reported that deliveries of light vehicle in US are up 3.4% yoy in 1Q2016.
  • JATO reported that new car registrations in Europe’s biggest 5 markets are up 8% yoy in 1Q2016.
  • China Association of Automobile Manufacturers reported that automobile sales in China rose almost 10% yoy in March 2016.

JATO 1Q2016 News Article

Diagram 2: JATO’s media release on new car registrations in Europe for 1Q2016

This quick health check shows that the automobile industry is indeed firing on all cylinders.  No wonder private equity firms are circling and investors are helping to support the bull run of Innovalues!

What Will Heartland Boy Do Now?

As the share price of Innovalues started trending towards his target price, Heartland Boy had also received quite a few emails and messages from his readers on his next action plan.  Given that Heartland Boy honed his investment skills from Adam Khoo, Adam Khoo would have advocated for simply holding on and riding the bull run. Heartland Boy is intending to do exactly just that. However, if the share price does indeed reach $1.22 and then somehow proceed to retrace by at least 8%, Heartland Boy would sell about 60% of his holding so that his remaining holding becomes “free”! He would then watch the drama unfold without stress, and hopefully without regret too.


Leave a Comment

« Initiation Report on Sarine Technologies
Wedding Preparation »

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Welcome to Heartlandboy.com

Hello there, I am Heartland Boy! I am always thinking about how I can improve my financial literacy in order to achieve financial independence. This is the place to be if you are hungry for financial independence (sometimes good hawker food as well) and foolish enough to believe in the musings of Heartland Boy. Read More…

  • About Heartland Boy
  • Contact
  • Work With Us
  • Privacy Policy
As Seen On

Copyright © 2023 Heartland Boy · All Rights Reserved
All content expressed herein are the personal opinions of Heartland Boy and does not constitute the views of any company nor as professional financial advice.

Copyright © 2023 · Divine Theme on Genesis Framework · WordPress · Log in