Tertiary education provider SEGi to see exciting year ahead
Posted on January 27, 2012, Friday
PROJECT PIONEER: The Malaysian government appoints SEGi as the project leader to promote skill based training to the international market as part of the ETP initiative.
KUCHING: Tertiary education provider SEG International Bhd (SEGi) will see an exciting year ahead with boosts from its memorandum of understanding (MOU) with the Vietnamese government to provide courses to trainees beginning 2012.
According to the research arm of Kenanga Investment Bank Bhd (Kenanga Research), SEGi was appointed by the Malaysian government as the project leader to promote skill based training to the international market as part of the Economic Transformation Programme (ETP) initiative.
Following the government’s call, SEGi signed an MOU with the Vietnamese government to provide various technical and skill based courses to 10,000 trainees over a period of three years beginning FY12 which will mainly be supported by the Vietnamese government.
“Thus, the group expects to generate an additional eight per cent income from this project from FY12 onwards,” outlined Kenanga Research.
Apart from this venture, SEGi should also see its earnings balloon in 2014 once its Ipoh campus was opened to students.
“The campus which has the capacity to house about 8,000 students (an additional 25 per cent of total students expected for FY12) is expected to breakeven within a year.
The campus will be sold and leased back,” the research house added. Apart from that, SEGi’s nursing and allied healthcare division was slightly hit when the National Higher Education Fund (PTPTN) decided to cut loans by the end of last year.
Nevertheless, Kenanga Research believed the group was ‘barely hit’ since more than 70 per cent of its students were self-funded and the balance 30 per cent were only partially dependent on the loan.
Furthermore the cut only applied to student’s expenses, while education and tuition fees loans remained.
However its nursing and healthcare courses were slightly hit ad is expected to moving forward are expected to get a slight hit due to the higher entry requirement set by the Malaysian government for nurses sometime last year.
Unlike Masterskill, SEGi’s diversified courses ranging from health science, engineering, business, design, architecture, art etc mitigates this concern.
“Moving forward, we are projecting a prudent 50 per cent dividend payout based on the company’s dividend policy albeit an estimated 170 per cent pay out last year alone (based on our estimated FY11 earnings),” affirmed Kenanga Research.
“That would translate to a dividend yield of 10.8 per cent and 4.6 per cent for FY11 and FY12 respectively at the closing market price of RM1.79. With the new policy in place, and growing earnings year on year, SEGi would be a new dividend play stock,” it concluded.
