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Koon Yew Yin's Blog

Author: Koon Yew Yin   |   Latest post: Wed, 12 May 2021, 4:10 PM

 

LB Aluminium is underrated - Koon Yew Yin

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My intention for writing this article is to help investors to make more money. Whether you buy or sell does not make affect the market price because the daily traded volume is more than 10 million shares. I am obliged to tell you that most of my money is on this stock.

Business Background

LB Aluminium Bhd is a Malaysia based company principally engaged in the business of manufacturing, marketing and trading of aluminium extrusions. Their product acts as a raw material for transport, construction, consumer goods, packaging as well as electrical engineering due to its lightweight, an excellent conductor of electricity and durability in nature. The company has expanded its business across Europe, North America, China, Australia, New Zealand and South-East Asia.

The company is one of the largest producers of aluminium extrusion products in Asia as shown below.

Aluminium Extrusion

With high accuracy and sophisticated technology, our products meet the most stringent and specific requirements set by our customers across different industries. We offer extrusion for aluminium alloy 1070, 6005, 6061, 6063, 6082, as well as special alloys, with extrusion profiles measuring up to 300mm in CCD (Circumscribing Circle Diameter) and extrusion length up to 12 meters. Diversity, quality and consistency are hallmarks that we pride ourselves in. 

China managed to stop the spread of the Covid 19 virus in Wuhan within a few months and all the factories started working full steam ahead.

As a result, China has increased its net import of primary and alloy aluminium to record high in the last 10 years as shown on the above chart.

The chart below shows that the price of aluminium has been going up in the last 1 year. It has gone up about 50% in the last 1 year.  

 

The above price chart shows that it is on up trend. The last traded price was 93 sen per share. It is likely to go up continuously.  

My target price:  

Its latest EPS was 6 sen and its previous quarter EPS was 3.76 sen. It shot up 60% from the previous quarter.

This shows that the company has been making and more profit every quarter. It is very safe to assume its EPS for each of the next 3 quarters will be 6 sen, its annual EPS will be 24 sen.

Based on PE 10, L B Aluminium share should be valued at Rm 2.40 per share.  

Additional information

Everyday Uses for Aluminium Extrusions

Extruded aluminium has helped create the ease in our lives today. Major components of cars, subway trains, bikes, airplanes, and boats are manufactured using aluminium extrusions. This doesn't include only the exteriors of the vehicle, but also the internal framework and the fasteners that hold it all together. The internal parts of the computer you're reading this on, along with the keyboard and mouse that you use and the desk that your computer sits on, all made with aluminium extrusions.

More than you know is made with aluminium extrusions. From the intricately grooved bleachers in stadiums and sports fields to the display units used in stores, all made with extruded aluminium.

The Extrusion Process

Extrusion is a process of shaping different molten metals and plastics by forcing them through shaped designs at extremely high pressures. Because of how flexible the process is, there are many different ways to perform the extrusion, including either hot or cold, and continuous or semi-continuous.

Try thinking of the extrusion process like making pasta. The dough is sent through a press, which emits long, continuous strands of spaghetti. The process with aluminium extrusion is very similar, except on a much bigger scale. The process involves workers melting down the metal until it is molten and then transferring it to the extrusion machine. This machine then via a hydraulic or mechanical press, forces the molten aluminium through a steel die at high pressure. If it is a continuous extrusion, the press will continue to force the metal through in one long, continuous section until the piece is done. If it's semi-continuous, the press will cut off pieces one by one as it is extruded.

Aluminium Extrusions in the Auto Industry

Aluminium plays a very important role in the auto industry. The metal provides resistance to the long-term environmental effects of temperature, moisture, and the corrosiveness from road salt. Everything from body and frame components to radiator enclosures, drive shafts and cylinder liners may be made from aluminium extrusions.

Extruded aluminium’s high strength-to-weight ratio makes it the perfect metal to be used in the auto industry. Allowing the vehicles to carry more, be faster, and all at a lower cost because of it being lightweight and strong.

Extruded Aluminium in Construction

Extruded aluminium products for construction are versatile, both in application and production. For example, lightweight extruded aluminium panelling and guide rails are common in trailer, shed, and furniture construction, however, denser structures are becoming more common.

Extruded aluminium isn't just limited to exterior design and function though. Lighting fixtures, elevator shafts, and stairwells all employ many different applications of extruded aluminium. Additionally, while aluminium can't make up the basic skeleton of a building it does accent and aids the structure in the interior of the building. Integrated extruded aluminium designs are featured in almost all areas of building construction including plumbing. Below are some examples from a recent project that we just finished.

 

 

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Labels: LBALUM

Related Stocks

Chart Stock Name Last Change Volume 
LBALUM 1.10 0.00 (0.00%) 3,249,000 

  2 people like this.
 
Andre Kua Looks like Uncle going from all-in glove to all-in steel.

True, steel pricing has been inching up and up non stop for the past quarter but demand is soft.
07/04/2021 1:00 PM
Dangel Next is Arank?
07/04/2021 1:41 PM
Sslee Is aluminium price increase good for LB Aluminium??

Current year prospects (continued)
Prospect for the Group
The Group’s operation has not been impacted by the recent reintroduction of the MCO/CMCO as the Group operates under strict standard operating procedures as required by the authorities to
prevent the spread of Covid-19. The incoming sales orders are at a satisfactory level and the trend is expected to sustain for the next quarter following the recovery of the global economy.

The recent spike in global aluminium prices is expected to reduce our margins as it will increase our production cost. As an effort to safeguard our margins, we will increase our selling prices whenever necessary and at the same time improve efficiency and reduce operational costs. As an effort to reduce the operational costs, the Group has commissioned its second solar photovoltaic rooftop project at our main factory in January 2021. The new solar photovoltaic rooftop project of 1.2 MWp is expected to generate an electricity saving of approximately RM50,000 per month to the Group.

For the property segment, the Group’s investment in an associate, Vistarena Development Sdn Bhd, is expected to continue the positive contribution in the coming quarters. The residential
development is 99.9% sold and the current construction progress is approximately 68.9%.

Barring unforeseen circumstances, the Board is optimistic that the Group will be profitable for the
forthcoming quarter.
07/04/2021 2:08 PM
apolloang why so many sellers?
07/04/2021 2:13 PM
amateurJR Must buy before uncle posts article only can earn money
07/04/2021 3:10 PM
amateurJR TP RM2.40? Haha
07/04/2021 3:11 PM
Alfonso when uncle buy call, u do nothing, when uncle sell call, u buy in more. This is the rule of winning, I have personally tested, it works so nicely for me. Thank you very much Uncle.
07/04/2021 3:13 PM
newdestination kyy shamelessness is very underrated
07/04/2021 4:20 PM
skyz Okay this is the first "buy" call so be alert and get ready to SELL before KYY offload silently. After all he always say is not obliged for your profit or losses. Follow blindly then die standing
07/04/2021 4:26 PM
Musang King Dont trust KKY anymore. His MMC call was a Fake. Making ppl buy but he sells.
07/04/2021 4:35 PM
Richard123456 use 1qr x4xpe10 to get TP, what kind of logic ?
07/04/2021 4:40 PM
xuxu uncle no promote glove lagi ?
07/04/2021 4:54 PM
Supermax2020 So many underrated stocks... but which one is the most profitable stock to invest that can become OTB?
07/04/2021 5:09 PM
Zuliana Uncle my real Uncle said AirAsia underrated.
You please buy.
Bursa has lots of underrated stocks.
Please don’t bull shiitt lah.
07/04/2021 5:42 PM
Kpin Yeoh once he wrote, next day start to sell
07/04/2021 5:42 PM
i3lurker of course this is NOT true at all.
He will key in queue sell first then he writes

a time lag is fatal coz others might queue sell before him

Posted by Kpin Yeoh > Apr 7, 2021 5:42 PM | Report Abuse

once he wrote, next day start to sell
07/04/2021 5:45 PM
Zuliana Who trust Kwhywhy? If you trust uncle WhyWhy, then your money fly away.
There is a Red Indian saying:

An old snake will change its skins faster then you buy old snake shares.

Hahaha.
07/04/2021 5:49 PM
Zuliana Typo***
There is a Red Indian saying:

An old snake will change its skins faster then you buy old snake skins (shares).

Hahaha.
07/04/2021 5:51 PM
kelvin61 Is public knowledge this stock is underrated. Geezer buys first today with his Machai and then write this piece. Geezer is hoping traders will rush in tomorrow to make him richer, what a greedy pig.
07/04/2021 6:53 PM
Timercheng Comfort, Supermx very2 under rated why not recommend uncle !
07/04/2021 7:21 PM
Timercheng Comfort n Supermx making Billion PAT per/yr lol!
07/04/2021 7:37 PM
chtan33 Uncle lost of direction.... so many underrated call...
07/04/2021 8:06 PM
Flybythenite PMetal better right?
07/04/2021 8:10 PM
Flybythenite Is so good why only 1/10 PMetal price?
07/04/2021 8:15 PM
maggiemee U all still believe him? Run ahhhhhhhh!!!! They want to dump share already push one last time before
Throw all
07/04/2021 8:29 PM
maggiemee AT ALSO SAID underrated at the end sold out finished only tell his followers publish article said misled by mr Ma. Run run run
07/04/2021 8:31 PM
sniper123 when KYY say underrated, it simply means its overated and time to SELL n RUN. Look at the price volume action on the chart, insiders oledi collecting since last week average cost <RM0.85. At today closing price RM1.02, insiders oledi hv margin of safety >20% and they can dump at all the ikan bilis retail clients. Good Luck!!!
07/04/2021 9:25 PM
taitaumau He says"I am obliged to tell you that most of my money is on this stock"
Is he telling the truth???
07/04/2021 9:43 PM
philip31 Better don't buy from him. He's waiting to sell to you.
07/04/2021 9:47 PM
MichelleNg Tomorrow limit up?
07/04/2021 9:54 PM
Selina888 I think kyy better not engage in more postings of his opinion because many are not happy with his views. Many do not trust him anymore and i think he is using pyschology on others. Why not retire and concentrate on doing charity work and seek peace. At his age, it is better to lead a simple life.
07/04/2021 9:57 PM
sniper123 As and when time permits all of you folks to study and analyse the price action volume of all of KYY so called underrated stocks such as dominant, eupe, kps and mnrb and now lb aluminium you will notice that 1 week before the article is publish in i3investor.com, there is always a "flush up" in the share price and this means oledi insiders taken position and waiting to dump once the article appears.
07/04/2021 10:27 PM
bobochacha lari kuat kuat dulu
07/04/2021 10:42 PM
kelvin61 Geezer has been abusing this space for years to make easy money. Why? He's crazy for money loh. Wonder if he can take it with him?
07/04/2021 11:34 PM
BILLC Wow,,,,nowdays KYY can’t even get one supporter here,,,,,looks like everyone knows his bau very well,,,,,,,wakakaka,,,,
08/04/2021 1:02 AM
llsksk https://www.tradingview.com/chart/LBALUM/gCWCBenl-granpa-kyy-says-lbalum-is-underrated/
08/04/2021 8:26 AM
kklim260 Oh Boy .. I just entered this ctr and he is here! Damn!
08/04/2021 8:56 AM
Bizfuneng Truly agree with you. Knowing KYY approaches pls be careful. No point to condemn him as he is a good writer, salesman stating figures/data and able to convince you to flw him without yourselves doing your own homework. I did trapped by him once. That was good enuf wake up call for me. Yes, KYY pls stop writing in I3

------------------------------------------------
Posted by Selina888 > Apr 7, 2021 9:57 PM | Report Abuse

I think kyy better not engage in more postings of his opinion because many are not happy with his views. Many do not trust him anymore and i think he is using pyschology on others. Why not retire and concentrate on doing charity work and seek peace. At his age, it is better to lead a simple life.
08/04/2021 9:30 AM
Stockisnotfun Kyy your gloves are flying again. You got buy or not?
08/04/2021 11:01 AM
Tiger66 bo cao si
08/04/2021 11:11 AM
stockfreak Always the opposite will happen.

Last time he said investment takes time (he sold Supermax after he said that).
08/04/2021 11:13 AM
newbie8080 Email: aduan@seccom.com.my

https://www.sc.com.my/api/documentms/download.ashx?id=c18035ab-a451-45e3-ac0e-5828cc2cee7a
08/04/2021 11:27 AM
speakup who dare to report KYY to SC & Bursa?
who dare?
08/04/2021 2:53 PM
hariz90 report2. this old guy need to be reported
09/04/2021 1:31 AM
relaxjack Thanks for the tip, uncle KYY!
10/04/2021 3:02 PM


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