KUALA LUMPUR (Oct 22): Shares of satellite pay-TV company Astro Malaysia Holdings Bhd fell 3.67% below its IPO price of RM3 at mid-morning trade as investors cashed out on its uncertain future.
At 11am, the counter was down 11 sen or 3.67% to RM2.89, with 31.5 million shares traded. It was one of the top 10 most actively traded counter.
"Investors are just not willing to take a risk. Not only is Astro expensive but yields are unattractive and there is no growth story moving forward," a fund manager told theedgemalaysia.com on Monday.
He explained that although Astro is a "decent company", its plans to upgrade its users with new Astro b.yond boxes will require heavy capital expenditure and this would result in minimum growth from the company for at least the next two years.
"So with yields less than 3%, no growth and investors paying a premium, how can it be attractive to investors?" he said.
The fund manager expects to see a continued downward trend in Astro's share price until its yield becomes attractive.
On its re-listing debut last week, the stock had gained 1% to RM3.03 at the opening bell and had climbed as much as 11 sen to RM3.11 but closed flat.
The zero maiden day gain makes Astro the fifth worst first-day performing IPOs among 15 issuers that debuted on the Bursa Malaysia this year.
Another fund manager told theedgemalaysia.com last Friday that the stock is not expected to tumble too much this week due to the support from its dividend promise, despite trading at richer multiples to peers.
Written by Syarina Hyzah Zakaria of theedgemalaysia.com
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