Q&M Dental

Q&M Dental: Q&M Dental is exploring a possible spin-off of its China and Malaysian subsidiaries, via a listing on a reputable stock exchange. The group has hired professional parties to explore the proposed listing.

Q&M believes that the proposed listing would better reflect the value of the dental healthcare business and will also provide its subsidiaries access to an additional source of funding to capitalise on growth opportunities and increase the scale of its operations in China and Malaysia.

Maybank-KE has a Buy rating on the counter with a TP of $0.92, based on 45x FY16 P/E. This is 1SD above its five-year mean, capturing Q&M’s strong earnings growth trajectory, M&A record and scarcity value.

With $42m of cash untapped from its recent MTN, market watchers are expecting more acquisitions to come. Opportunities are abound also in the Singapore dental market, which remains very fragmented with 630 dental clinics and 1,800 dentists.