HIL Industries Bhd
HIL’s appeal seems to lie in being a privatisation-play (please see our article on Oct 13, 2014) given its low free float and large cash holding. The company has net cash of RM101.7 million as at 30 June 2014, or 36.8 sen per share — half the current stock price.

HIL is involved in producing injection moulding products and is 65.9% owned by its two largest shareholders, Dalta Industries Sdn Bhd and Dato’ Ng Boon
Thong @ Ng Thian Hock.

Interestingly, if Dalta and Ng opts to privatise the company, it will cost them nothing. At current prices, it would only cost RM 69.8 million to acquire the remaining shares they do not own, which can be recouped from the company’s cash on hand. Notably, an attempt was made to privatise HIL previously in 2006. The stock is trading at 0.7 times book with a trailing 12-month P/E of 21.3 times.

This article first appeared in The Edge Financial Daily, on November 5, 2014.