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Raffles Medical Group
31-10-2010, 09:06 AM.
Post: #1
Raffles Medical Group
With the spotlight trained on medical groups (e.g. Parkway and Thomson Medical) recently, it is perhaps timely to look at the other major player in Singapore.

RMG's share price has also rebounded nicely form the low of 50+ cents during the worst of the financial crisis. With:

(1) a strong balance sheet and net cash of $70.9 million (13.5c/share), (2) a good record of cashflow,
(3) a varied offering of medical services catering to the wealthy in the region (check up their website) and
(4) future expansion of Raffles Hospital (additional capex of $80 million to $100 million funded from internal resources)

is there still value at the last traded price of $2.18/share? Current valuation does seem rich. However, it is a good business to own given that there will always be demand for its services and its profit margins are also decent. Any views?

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14-01-2011, 03:06 PM. (This post was last modified: 14-01-2011, 03:11 PM by valueinvestor.)
Post: #2
RE: Raffles Medical Group
Will RMG be a takeover target of Fortis ?

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18-01-2011, 12:44 PM.
Post: #3
RE: Raffles Medical Group
I don't think Dr Loo is looking to sell, although everything has a right price.

I think its indeed a good business to own. There are not many private hospitals in Singapore and even less to buy. Its service is quite good based on anectodal experience. There is almost no end to demand for medical care, and I am happy to partake in some of the profits earned by the medical profession. Still, it has run up a lot recently.

(vested)

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18-01-2011, 03:00 PM.
Post: #4
RE: Raffles Medical Group
Loo is 63 this year, he can sell and continue to work ( normally he is required to serve few years under service agreement, after takeover by new contrlling shareholder). He can just cash out few hundred miilions and retire and be a passive investor . As long as the price is attractive to him, why not ? There was rumour that the 27 % just changed hand thru married deal , Fortis was the buyer . Let's wait to see whether this is true.

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18-01-2011, 05:06 PM.
Post: #5
RE: Raffles Medical Group
hmm that would be interesting. LCY's deemed interest was 43% though. I believe Temasek holds a small portion as well. I don't think 27% will get things done. So yes, perhaps we have to wait and see.

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18-01-2011, 06:18 PM.
Post: #6
RE: Raffles Medical Group
Update: LCY's last reported change of interest in Nov '10 had him at 53%.

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18-01-2011, 07:03 PM.
Post: #7
RE: Raffles Medical Group
(18-01-2011, 03:00 PM)tonylim Wrote: Loo is 63 this year, he can sell and continue to work ( normally he is required to serve few years under service agreement, after takeover by new contrlling shareholder). He can just cash out few hundred miilions and retire and be a passive investor . As long as the price is attractive to him, why not ? There was rumour that the 27 % just changed hand thru married deal , Fortis was the buyer . Let's wait to see whether this is true.

Sorry typing error, should read 4.7 % ( Not 27%). If cross 5%, buyer must declare identity.

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05-03-2011, 06:30 PM.
Post: #8
RE: Raffles Medical Group
Some strong buying interest on last Friday. They bought because it is undervalued or a potential takeover target ?

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23-03-2011, 11:45 AM.
Post: #9
RE: Raffles Medical Group
From UOBKH:-

Raffles Medical Group- Concrete expansion plans in Singapore. Premier healthcare play.

(BUY/S$2.23/Target: S$2.81)
FY11 P/E (x): 13.6
FY12 P/E (x): 12.3


Raffles Medical Group (RMG) has slightly underperformed the FSSTI, falling 6.7% ytd vs the marketâ€s -5.9%. We highlight its concrete expansion plans and reiterate BUY for its solid outlook, strong earnings and execution track record. More details can be found in our blue top report dated 22 Mar 11.

Premier healthcare exposure in Singapore. RMG remains on our BUY list with a target price of S$2.81, based on DCF valuation which factors in a long-term growth of 4.0%.

Our target price implies 28.9x 2011F PE, which is more than 1SD to its mean PE of 20.6x (2003-present). We think the premium is deserved given the scarcity premium after the de-listing of Parkway and Thomson Medical as well as its strong operating cash flow.

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26-03-2011, 12:47 AM.
Post: #10
RE: Raffles Medical Group
They are smart to buy Freehold building in Cairnhill Area. High end positioning and not many FH commercial buildings in that area.

(23-03-2011, 11:45 AM)tonylim Wrote: From UOBKH:-

Raffles Medical Group- Concrete expansion plans in Singapore. Premier healthcare play.

(BUY/S$2.23/Target: S$2.81)
FY11 P/E (x): 13.6
FY12 P/E (x): 12.3


Raffles Medical Group (RMG) has slightly underperformed the FSSTI, falling 6.7% ytd vs the marketâ€s -5.9%. We highlight its concrete expansion plans and reiterate BUY for its solid outlook, strong earnings and execution track record. More details can be found in our blue top report dated 22 Mar 11.

Premier healthcare exposure in Singapore. RMG remains on our BUY list with a target price of S$2.81, based on DCF valuation which factors in a long-term growth of 4.0%.

Our target price implies 28.9x 2011F PE, which is more than 1SD to its mean PE of 20.6x (2003-present). We think the premium is deserved given the scarcity premium after the de-listing of Parkway and Thomson Medical as well as its strong operating cash flow.


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