Our opinion on the current state of PSG-KST(KST)PSG Fin (previously PSG Konsult) is a well-established financial services group that originated from PSG's stockbroking business and now offers a broad range of financial services, including financial planning, unit trusts, healthcare, short-term insurance, and estate planning. PSG retains a 60% stake in the company.
In its results for the six months ending 31st August 2024, PSG Fin reported a 28% increase in recurring headline earnings per share (HEPS) and a 16% rise in assets under management (AUM) to R435.7 billion. Gross written premiums also grew by 10%. The company noted that while operating conditions remained challenging, more favorable equity markets and sustained high interest rates positively impacted its results during the period.
The share currently trades on an earnings multiple (P:E) of 22.81, which suggests that it is not cheap. However, PSG Fin is a high-quality company with a proven ability to deliver solid returns, even in difficult economic conditions. Technically, the share has been in an upward trend since March 2020, indicating good value at current levels.
On 1st March 2022, PSG announced that it would be unbundling its 60.8% holding in PSG Konsult to its shareholders, a move aimed at releasing value. PSG Fin (KST) was added to the Winning Shares List (WSL) on 23rd May 2024 at a price of 1610c, and the share has since risen to 1850c. Given its solid track record and growth potential, it appears poised for further gains.
