KUALA LUMPUR (Nov 30): The dividend policy of Sime Darby Bhd in its pure play form is expected to remain the same as when it was a conglomerate, according to group chief executive Jeffri Salim Davidson.

“The dividend policy of Sime Darby before the [demerger] was [a payout ratio] not less than 50% of Profit After Tax and Minority Interest, and in fact in the last few years [payout] has been more than that].. so we don’t expect any changes to the dividend policy of Sime Darby [in its pure play form],” he said.

For its financial year ended June 30, 2017 (FY17), Sime Darby recorded a dividend payout ratio of 64%, and a total dividend payout of RM1.6 billion.

Jeffri was speaking to reporters after hitting one of the three ceremonial gongs today to mark a new era for the Sime Darby Group — the separate listing of its three pure play entities, which are Sime Darby Bhd, Sime Darby Plantation Bhd (SD Plantation) and Sime Darby Property Bhd (SD Property).

Sime Darby shares had opened at RM2.40, marking a strong 55 sen or 30% increase from its listing reference price of RM1.85. At its opening price, Sime Darby’s market capitalisation stood at RM16.32 billion.

“It’s a good start for Sime Darby, but as mentioned by Tan Sri Abdul Wahid Omar’s point, what is important is the value combined with SD Plantation and SD Property,” he said.

Wahid, who is the chairman of SD Property and the chairman of Sime Darby’s major shareholder Permodalan Nasional Bhd (PNB), said that it is important for shareholders to look at the combined pricing of the three entities to derive value creation rather than to look at it on a singular entity basis.

As for the gearing levels of Sime Darby, Jeffri said this was at 18% at present, which the group sees as a comfortable level.

Sime Darby shares ended the noon market up 54 sen or 29% from its listing reference price to RM2.39, with 63.98 million shares traded and a market capitalisation of RM16.25 billion.

As at noon market close, the market capitalisation of the three combined pure plays was RM58.41 billion, 3.9% lower than Sime Darby's market capitalisation of RM60.8 billion last Friday, before the separate listing of the three.