Sales Post: Asia Satellite (1135 HK) and Yorkey Optical (2788 HK)

Asia Satellite (1135 HK): Ex-cash P/E less than two times. As of the end of December 2008, Asia Satellite (1135 HK) was in a net cash position of HK$2,445.5m, or HK$6.25 per share, which is equivalent to about 75.8% of the counter’s yesterday closing price of HK$8.25. The company’s ex-cash historical P/E for FY08 is about 1.6x. Further, it is trading at a about 37.0% discount to its BVPS as of the end of 2008, HK$13.1. The company proposed a final dividend of HK$0.31/share for FY08. Together with the interim dividend of HK$0.08/share, the dividend for the full fiscal year of FY08 is HK$0.39/share, representing a dividend yield of 4.7%.

Yorkey Optical (2788 HK): Cash value larger than its market capitalization. As of the end of December 2008, Yorkey Optical (2788 HK) had US$132.2m net cash on hand, or HK$1.25/share. The counter closed at HK$1.05 on yesterday. That said, its share price was less than its cash value per share by 16.0%. Further, the counter was trading at a discount of 37.1% to its BVPS of HK$1.67/share. The company proposed a final dividend of about HK$0.13 per share. Together with interim dividend of HK$0.0468, the full year payout is about HK$0.18, representing a dividend yield of 16.9%.

Contributor: Andes Cheng, VP Institutional Sales, SBI E2-Capital