RGB among top actives today on anticipated progressive dividend policy

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KUALA LUMPUR (Aug 5): Shares of RGB International Bhd, which is involved in the sales and marketing of gaming machines and equipment in Asia, were among the most actively traded on Bursa Malaysia today.

At 4pm today, some 26.4 million RGB shares were traded so far, making the third most traded counter on the local bourse. Its share price, however, was up only one sen to 14.5 sen.

RGB shares were trading up 1 sen, or 7.41% to 14.5 sen with 26.4 million shares traded and was among the top three most active counters on the local bourse.

In a note yesterday, UOB KayHian Research said that it expects RGB (fundamental: 1.7; valuation: 1.8), which should be net cash positive by end-2015, to implement a much more progressive dividend policy from 2016 onwards.

“We continue to expect RGB to deliver a stronger second half ending Dec 31, 2015 (2HFY15) versus 1HFY15, reflecting higher sales of slot machines (around 600 units versus 1HFY15’s 400 units), and sturdier growth in slot concession business which is mainly driven by the Timor-Leste joint venture (JV) with a local slot club owner (operations commenced in 4Q14),” said UOB Kay Hian.

The research house maintained its "buy" call on the stock, with a lower target price of 19 sen to reflect share base dilution following its recent 10% share placement exercise.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)