The JSE and finance forum for South Africa
General Category => Shares => Topic started by: jaDEB on April 10, 2014, 09:21:40 am
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IPO
Financial services group PSG Konsult has announced its long-awaited listing on the JSE along with its financial results for the year to February 2014.
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Details from PSG Konsult's website:
current price: 699
PE: 34.95
D/Y: 1.62
Shares in issue: over 1.2B
Market cap: R8.8B
Often trades over a million shares. On the 5th of March it was trading at 500. The push up to 700 seems to be based on the listing news.
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PE is nogal high .. 8)
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New friends for Sanlam & Coronation.
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PSG Konsult to list on the JSE Wednesday, June 18.
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Should be interesting to see at what price it opens and ultimately closes on 18th - last traded at R 7.45 on 30th May 2014 when it was suspended as an over the counter traded share
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Guys a little help please. OTC shares - where do you trade them? How do you trade a share that has not been listed yet?
Same question regarding Preference shares. How and where do you trade them?
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Supposedly all OTC shares will cease to trade - the JSE has closed down this operation as there are very few regulations governing these transactions and the purchaser does not have the same protection as they could derive from the controls in place by the JSE.
Preference shares to my knowledge can be bought through your broker - I will check with my brokers as to how I can buy pref shares and if it is not through a broker then I will revert on this forum
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Supposedly all OTC shares will cease to trade - the JSE has closed down this operation as there are very few regulations governing these transactions and the purchaser does not have the same protection as they could derive from the controls in place by the JSE.
Preference shares to my knowledge can be bought through your broker - I will check with my brokers as to how I can buy pref shares and if it is not through a broker then I will revert on this forum
Have spoken to my broker - if the pref share is quoted on the JSE then one can trade it like any other share and buy into the pref share using their trading platform. He did warn that pref shares you are buying into an income stream and that dividends are based on a % of the prime interest rate. It would make more sense to buy into the companies shares enjoy the capital appreciation and dividends rather into pref shares, unless you only interest is the dividend stream
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Thanks GCR. Yes I am only interested in them for creating an income stream. I still don't know where to go and look for preference shares. It's an enigma!
Anybody? Newspaper, website, bank?
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Morning Snakepit, i have listed the number of pref shares you can buy on the JSE
QuickShare Search : Preference Shares
Search Again :
Name Full Name Code Sector
NPP1 NAMPAK 6,5%P NPP1 A221
RLZP REUNERT5,5%P RLZP A221
SHFINV-P STEINHOFF INVEST HLD PRF SHFF A221
CLOVER-P CLOVER INDUSTRIES LTD CLRP A221
POTP BRIAN PORTER 5,5%CUMPREF POTP A221
DLP1 DORBYL 5,5%P DLP1 A221
BARWORLDP BARWORLD LIMITED BAWP A221
AFEP AECI 5,5%P AFEP A221
SBKP STANBANK 6.5% PREF SBKP A221
INVPLC-P INVESTEC PLC PREF INPP A221
SHP2 SHOPRIT 5%P SHP2 A221
INPR INVESTEC LTD PREF INPR A221
SHP1 SHOPRIT 6%P SHP1 A221
RACP RECM & CALIBRE LTD PREFS RACP A221
LBHP LIB HOLD 11P LBHP A221
SHP4 SHPRT 3RD5%P SHP4 A221
SHP3 SHPRT 2ND5%P SHP3 A221
MAQP1 MACQUARIESA EL PREF EXX1 MAQP1 A221
ASTRAPAKP ASTRAPAK LTD PREF APKP A221
BRAITPRF BRAIT SE Pref BATP A221
TFG-P THE FOSCHINI GRP PREF TFGP A221
AFPREFINV ALEX FORBES PF SHARE INV AFP A221
IVT-P INVICTA HLDGS LTD PREF IVTP A221
CULINAN-P CULLINAN HOLDINGS LIMITED CULP A221
RTOP REX TRUE 6%P RTOP A221
NETCARECP NETWORK HEALTHCARE CP NTCP A221
INVLTD-P INVESTEC BANK LTD PREF INLP A221
Nedbank-P Nedbank Limited NBKP A221
FIRSTRNDP FIRSTRAND LTD B PREF FSRP A221
DSYB_P DISCOVERY HLDGS LTD B PREF DSBP A221
ABSA-P ABSA BANK LTD PREF ABSP A221
PSG-P PSG FINANCIAL SERV PREF PGFP A221
IMPERIALP IMPERIAL HOLDINGS PREF IPLP A221
ABIL-P AFRICAN BANK INVESTMENTS ABLP A221
STANBANKP STANDARD BANK GROUP PREF SBPP A221
DLVP DORBYL 5%P DLVP A221
NPKP NAMPAK 6% P NPKP A221
SASFIN-P SASFIN HOLDINGS LTD PREF SFNP A221
CAPITEC-P CAPITEC BANK HLDGS PREF CPIP A221
INVPREFR INVESTEC PLC PREF (RAND) INPPR A221
GRINDRODP GRINROD LTD GNDP A221
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Some observations I have on these pref shares - why would one buy them in the first place they all seem to give around 5% to 6.5% which is almost what the CPI is thus you are not going to score in the longer term especially if the CPI turns nasty. I have just extended a Fixed Deposit with a bank at 5.85% for 6 months and I get a tax break on the first R31,000 from SARS. Not sure what the rules are but are pref shares treated as interest income or share dividends - if treated as dividends then you will pay 15% withholding tax on the dividend. To my knowledge the pref share price does not increase to the same extent as the ordinary share price so capital gains could be quite slow paced
Snakepit - not sure what your objective is, but maybe you need to revisit the objective, also if SARS deem these as shares you may well have to hold for 3 years - if so you can get about 8% on a 36 month FD - but with rates likely to go up I wouldn't invest for longer than 6 months at the moment
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GCR, you are right with your comments. I wanted to know more about them as I am investigating the dark side - debt instruments. FRANZ, thanks for that info. Much appreciated.
To get back to your comments GCR, I am also baffled why anybody would buy pref shares and not just go for a fixed deposit. What are we missing???
GCR maybe you can take a look at this video and just maybe you see or hear something I have missed - http://www.justonelap.com/webinarDetail.asp?intWebinarID=100
Registration is free. Download the vid.
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Snakepit - Simon Brown of JustoneLap runs a monthly presentation at the JSE here in Joburg - The Power Hour - he or an expert in their fields talk on a variety of subjects. If I get a chance I will try and collar him and ask him what the benefits are of investing in pref shares versus other instruments - there is a Power Hour tomorrow night at the JSE - if in Joburg attend it is free,but get onto their mailing list as you could crack parking in the JSE and these sessions are normally very well attended
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Heheh no sorry, can't make it - Durbanville, Cape Town! :'(
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Pref. shares are tax free after the dividend withholding tax. When STC was abolished and replaced by the withholding tax, investors thought they would be worse off, but the bank prefs, like NBKP, not wanting to leave investors worse off, increased their payout from 75% of prime to 83.33%
Amendment to the terms of the non-redeemable non-cumulative non-participating
preference shares in the issued share capital of Nedbank Limited (`Nedbank
perpetual preference shares`)
Holders of Nedbank perpetual preference shares are referred to the
announcement, released on the Securities Exchange News Service (SENS) of JSE
Limited on 1 March 2007, setting out the potential effects on the Nedbank
perpetual preference shares of the then proposed amendments to the tax
legislation regarding the introduction of a dividend tax on all distributions,
including dividend distributions, by a company to its shareholders, as
contemplated in sections 64D to 64N of the Income Tax Act, 58 of 1962, as
amended (`Income Tax Act`) (`dividend tax`), in the place of STC. Those
proposals have now been incorporated into the necessary amending legislation,
which has come into effect and will apply from 1 April 2012.
As a result of the amendments to tax legislation, the board of directors of
Nedbank Limited has resolved, subject to the passing of the required
resolutions by holders of Nedbank perpetual preference shares and holders of
Nedbank Group Limited ordinary shares, to amend the rate used to calculate the
preference dividend payable on the Nedbank perpetual preference shares, from
the current rate of 75% of the prime rate to 83,33% of the prime rate.
The amendment will apply to dividend number 19, the dividend declared and paid
on Nedbank perpetual preference shares on or after 1 April 2012, the date on
which dividend tax becomes effective.
With rising interest rates their prices should rise, i.e. it's not a bad time to buy them, but only if you are
looking for tax relief as a high income earner. The after tax yield will always be way better than parking
cash in the money market.
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Heheh no sorry, can't make it - Durbanville, Cape Town! :'(
Will check tonight as to whether they run such a session in CT - I know they do in Durban. Will post results once to hand
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Heheh no sorry, can't make it - Durbanville, Cape Town! :'(
Will check tonight as to whether they run such a session in CT - I know they do in Durban. Will post results once to hand
Seems like tonight's session may not be The Power Hour, but, Lavan Gopaul dealing with futures, awaiting confirmation from JSE - if it is the latter then I won't attend as attended last year
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Thanks Moonraker. So the bottom line if I understand it correct, is that compared to putting money into the bank, you will pay less tax. You do get a component of interest earned at your bank tax free, think the amount is round R31000, but once that component is exceeded you will start paying tax at, what 18%, and as you earn more interest you will move into higher tax brackets. But with prefs you will just pay the divi tax.
So the bottom line is that up to that R31000 you can go the bank route but once you exceed that, prefs are the route to go?
Now a question pops up - that R31000 tax free money, is that per year? In prefs you pay that divi tax from day one. So a good move could be to put your money in the bank for 6 months to get the R31000 tax free and the take it out and buy prefs for the ramaining 6 months and then next year sell the prefs and put ht emoney back in the bank and for the second 6 months put it in prefs again.
You basically swing it to prefs as soon as you hit the R31000 tax free number?
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The interest exemption is 23.800-00 (<65) not 31.000-00
So you can have an interest bearing investment(s) of 340.000-00 @7% = 23.800-00 and pay zero tax on the 340.000-00
Taking the NBKP pref. @ currently ± 7% you would pay tax of 3.570-00 (15%).
If you double the invested amount, and assuming a 30% marginal tax rate:-
Interest bearing investment(s) is 680.000-00 @7% = 47.600-00 less 23.800-00 (exempt) = 23800-00 taxable @ marginal rate 30% = 7.140-00 tax
NBKP pref. - 680.000-00 @ ± 7% = 47.600-00 less 15% = 40.460-00. Tax also 7140-00
So the higher your income and marginal tax rate, the larger the benefit in favour of pref. shares.
Pref. shares are best suited for high net worth folks and are for the longer term. Their attractiveness increases in a rising interest rate cycle, when they should outperform bonds. Capital gains (and losses) can be made.
See also Here (http://www.moneyweb.co.za/moneyweb-safm-market-update/preference-shares-chris-gilmour--analyst-absa-asse)