broker report

CVC) RECOMMENDATION @ $1.87  ST:  BUY  LT:  OUTPERFORM  BCM 
KEY POINTS:  
o NTA rises sharply 
with strong Sunland 
price. 
o Now trading at a 
substantial discount 
to NAV & its peers. 
Year to 30/6 06(A) 07(E) 08(E) 
Profit Adj($m) 23.3 30.1 39.8 
PE (x) 10.0 8.1 8.1 
Yield (%) 3.2 6.4 6.4 
Franking (%) 100 100 100 
Target Price:  $2.90 
 
Net Tangible Assets Update – With the 
substantial increase in price for Sunland (SDG) to 
$4.20, the net asset value (pre-tax) of CVC has 
increased to $2.20 ps, as outlined in the table on 
right.  This values Cellnet at current market value & 
CVC’s interest in Mercury Mobility from the 
demerger & rights issue at cost. 
As CVC marks to market its listed & some private 
equity investments, the increase in Balance Sheet 
value is offset by an increase in deferred tax 
provision.  Adjusting for this provision & 
Intangibles, the NAV & NTAV have increased to 
$2.02 & $1.97 respectively. 
At $4.20, SDG comprises 37.3% of Net Assets (pre- 
tax).  Every 10 cent change in the SDG price, 
results in a 1.4¢ ps change in CVC net assets. 
We remain positive on CVC, expecting strong 
growth over the next few years, based on 
expansion of existing operations & utilisation of 
funds raised to broaden increase their highly 
successful operations, currently trading at a 
substantial value discount to its NTAV, peers and 
the general market.   
Net (Tangible) Asset Calculation 
Item $m 
Cash 120.0 
Listed investments 206.8 
Private Equity 33.0 
Other 24.2 
Total 384.0 
  less Debt 0.0 
Net Assets (Pre-Tax) 384.0 
   Deferred Tax -36.9 
Net Assets  (post-tax) 347.0 
  less Intangibles -8.6 
Net Tangible Assets  (post-tax) 338.4 
  Issued Capital 171.9 
Net Asset value ps Pre-tax 2.23 
Net Asset Value ps Post-tax 2.02 
Net Tangible Asset Value ps Post-tax 1.97 
 Disclaimers.  SHAW, & its wholly owned subsidiary Shaw Corporate Finance Pty Limited, was a 
participant in the recent placement in CVC, for which they received a fee.  SHAW, its associates, 
employees & authorised representatives have an interest in the financial products of the CVC. 
SHAW & its wholly owned subsidiary Shaw Corporate Finance Pty Limited, has been appointed Lead 
Underwriter for Mercury Mobility, for which they will receive a fee.  SHAW, its associates, employees 
& authorised representatives have an interest in the financial products of the Company.