(MENAFN- Muscat Daily) The public offer of Omantel shares to Omani individuals, the second phase in the government's divestment plan, has generated widespread interest and participation, gathering momentum in the penultimate week of the offer period.
There seems to be a big rush at the Muscat Depository and Clearing Company (MCDC) for new MSM folio numbers from new prospective investors, as well as existing holders of MSM folio numbers to open new accounts for their family members, a press released said.
Leading brokerages have given attractive valuations and estimated a significant upside potential in the Omantel share price over a 12-month horizon.
Oman Arab Bank (OAB) has estimated a target price of RO1.780 for Omantel shares. ''Stable dividends offer investors an opportunity to earn attractive yields relative to the region. At current prices the stocks offers a dividend yield of 7.2 per cent over the next 12 months (including an interim dividend of 40bz per share payable in August 2014). We value Omantel at a one-year target of RO1.780 per share,'' OAB said in its analysts' report.
United Securities has raised its 12-month target share price of Omantel by five per cent to RO1.755, due to the overall improvement in earnings compared to earlier estimates.
''Our recent model update supports a compelling valuation upon reasonable judgment on its intrinsic value. Omantel trades at an attractive PER of 10x to 2014E earnings with an annual dividend yield of 7.2 per cent (115bz), offering an upside potential of ten per cent from the current levels over a 12-month horizon. We reiterate our buy rating on the stock, while expecting the issue to be priced at a reasonable discount to current valuations,'' United Securities said.
NBK Capital of Kuwait estimated a 12-month fair value of Omantel shares at RO1.710, showing a more than 20-per-cent upside potential.
''In Oman, we favour Omantel, given the strong domestic leadership position, its attractive dividend yield of over seven per cent (versus the MENA average of six per cent), its compelling valuation and its potentially improved liquidity upon completion of the upcoming sale of the government's stake,'' NBI Capital said in its analysts' report.
Bank Muscat expressed its satisfaction with the initial feedback received by the public offering, after the successful completion of the first phase of the divestment under which the private placement was oversubscribed 1.99 times.
Given that only about 50 per cent of the appetite of high-neworth Omani individuals and institutions was satisfied under the private placement phase, it was expected that post listing of the public offer, there will be a strong demand for Omantel shares on the MSM from Omani investors.&nbs
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