Highlights
KLSE: PCHEM (5183)       PETRONAS CHEMICALS GROUP BHD MAIN : Industrial Products
Last Price Today's Change   Day's Range   Trading Volume
6.58   -0.06 (0.90%)  6.55 - 6.64  2,286,200
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Overview

Market Cap: 52,640 Million
NOSH: 8,000 Million
Avg Volume (4 weeks):3,260,716
4 Weeks Range:6.50 - 7.58
4 Weeks Price Volatility (%):
7.41%
52 Weeks Range:6.50 - 9.49
52 Weeks Price Volatility (%):
2.68%
Average Price Target: 7.66
Price Target Upside/Downside: +1.08

Financial Highlight

Latest Quarter | Ann. Date 30-Sep-2019 [#3]  |  13-Nov-2019
Next QR | Est. Ann. Date: 31-Dec-2019  |  25-Feb-2020
T4Q P/E | EY: 14.00  |  7.14%
T4Q DY | Payout %: 4.41%  |  61.70%
T4Q NAPS | P/NAPS: 3.73  |  1.76
T4Q NP Margin | ROE: 21.99%  |  12.60%

Headlines

Date Subject
13-Jan-2020 Oil & Gas - Geopolitics to Drive Volatility in the Near Term
10-Jan-2020 下跌股:国油石化RM7.15支撑
08-Jan-2020 Trading Stocks - Petronas Chemicals Group
02-Jan-2020 Petronas Chemicals Group Berhad (KLSE) #RTable - CashRich Series - YAPSS
31-Dec-2019 原油价看涨‧油气上游业复苏在望
23-Dec-2019 Trading Stocks - Petronas Chemicals Group
19-Dec-2019 Stocks on Radar - Petronas Chemicals Group (5183)
16-Dec-2019 Trading Stocks - Petronas Chemicals Group
10-Dec-2019 Malaysian Oil and Gas: Petronas Monetization, PCHEM Outperform
30-Nov-2019 [转贴] [Facebook live video:浅谈Petronas Chemicals group bhd (PChem)] - James的股票投资James Share Investing
22-Nov-2019 下跌股:国油石化RM6.80支撑
20-Nov-2019 Petronas Chemical Group - Oh My Chemicals
18-Nov-2019 Stocks on Radar - Petronas Chemicals Group (5183)
15-Nov-2019 PCHEM: Outperform Maintained Despite a Disappointing Result
15-Nov-2019 Petronas Chemicals Group - Soft Outlook Underpinned by Trade War
15-Nov-2019 Petronas Chemicals Group - Expect near full plant utilisation in 4QFY19
15-Nov-2019 Petronas Chemicals Group Berhad - RAPID-ly Rolling On
14-Nov-2019 Petronas Chemicals - Weak as priced
14-Nov-2019 Petronas Chemicals Group Bhd - Cracks Starting to Show
14-Nov-2019 Petronas Chemical Group Berhad - Commendable Overall PUR of 81% Despite Heavy TA

Business Background

Petronas Chemicals Group Bhd manufactures and sells a variety of petrochemicals. The firm organizes itself into two segments based on product type: Olefins & Derivatives and Fertilizers & Methanol. The Olefins & Derivatives segment, which generates the majority of revenue, sells chemicals used in the production of acrylic acids, antifreeze, printing ink, dyes, gas treating solvents, personal care products, and plastics used in packaging films, wires, cables, and ducting. The Fertilizers & Methanol segment sells chemicals used in gasoline additives, plastic resins, ammonia, and fertilizers. The majority of revenue comes from Malaysia, China, and Indonesia.
Analyze this stock with MQ Trader system

  8 people like this.
 
Joon Chan wish got like a chat function on market depth.
can say, oi! dumbo, got more than 40k lots in Q, now alone u can see 5k to 1k lots! why u trigger happy sell so cheap for what
15/01/2020 3:10 PM
RainT wah downtrend oh
15/01/2020 3:43 PM
Joon Chan more perspective...

https://imgur.com/gallery/CNNGDZ2
15/01/2020 5:41 PM
pohmun pls give constructive view and dont argue here. dont waste everyone time. we are more interested in share price. not your great grand story.
16/01/2020 2:48 PM
Aristocats Wah susah. I beli banyak, this national asset stock goes down. Sad
17/01/2020 11:37 AM
RainT will go down more
20/01/2020 10:20 AM
RainT i am waiting the RAPID to show in the financial results

when when
20/01/2020 10:21 AM
RainT will PCHEM incur high depreciation in start of RAPID?

Will there be high one off expenses due to RAPID?

In the 1st few quarters of RAPID come to full operations
20/01/2020 10:24 AM
monetary triper cheese burger. buy back!
21/01/2020 12:33 PM
Titan China banning single-use plastic......guess this will somehow affect a part of PCHEM revenue.
22/01/2020 11:11 AM
RainT from down then up a little

now want to go back down again

haiz
22/01/2020 5:09 PM
enigmatic ¯\_(ツ)_/¯ Isn't it a good thing to be able to acquire extra PCHEM at low prices for the long term?

But I do think in near term, things aren't looking that good until & unless next QR posts a better performance, indicating Pengerang's positive effect taking place.

I suppose traders could take this opportunity as well to hit and run, assuming PCHEM returns to RM7.00+ soon.
22/01/2020 5:27 PM
Choivo Capital Until today, i still don't know why i bought a small position in PCHEM.

Its not horrible, but there is so many better ones.
23/01/2020 1:20 AM
Choivo Capital Joon Chan,

What is your understanding of the company?
23/01/2020 1:21 AM
Philip (Can I advise you?) It is a far better investment than buying into lctitan at these prices.
24/01/2020 4:21 PM
Sslee Hahahaha,
Discount day sales again.
24/01/2020 5:23 PM
Joon Chan Of course there are better.
Risk is opportunity cost to me.
But where would you park 5m or more?
25/01/2020 12:51 AM
Joon Chan oh, happy new year to all.
very rocky start with viruses all around, let's hope it all goes away soon and fortune for all following next
25/01/2020 12:55 AM
RainT This need collect when dip and hold it for few years

Dip then collect again
28/01/2020 10:46 AM
Choivo Capital I digress.

Its somewhat attractive, but i'm not sure if its far better.

===
Philip (Can I advise you?) It is a far better investment than buying into lctitan at these prices.
24/01/2020 4:21 PM
28/01/2020 11:23 AM
Philip (Can I advise you?) Volatility is our friend. When stock prices go down without warning, especially on rock solid wealth generating companies that are triple A rated by banks ( Moody's rate Petronas as a safer investment than Malaysian government), and there is no clear reason for business downturn other than short term scares from China virus, this is a sure sign of a discount opportunity.

Like how munger likes to put it, look to the business first before determining the price. And when you look at the business try to understand the long term prospects of the company.

Once earnings normalize, we are looking at a company with:

20 billion in assets,
12 billion in cash.
And 2 billion in debts.

Historically it has been doing 4 billion in earnings, with the current drop-down recently. If you believe this will continue to stabilise and earn 4 billion a year , with 20+% profit margins,

You are paying 43 billion ( minus 10 billion in cash) for a company that generates 4 billion in earnings yearly, which I think is a great deal.

As it looks likely that you will receive 25 cents this year and using that as a benchmark, getting a 3.77% dividend with a likelihood of a company growing the next few years will be a wonderful investment.

I have increased my exposure at these wonderful prices which is a multi year low. Happy to invest further.
28/01/2020 12:45 PM
Sslee Hahahaha
Me too.
28/01/2020 12:48 PM
calvintaneng NO SSLEE

LONDON BISCUIT ALSO GAVE DIVIDENDS IN EARLY DAYS

BUT PRICE CANNOT SUSTAIN IS NO GOOD BUSINESS

TRADE WAR WILL SAP DEMAND FOR PETRO CHEMICALS

BETTER SELL PETCHEM & BUY NFCP FIBERISATION STOCKS NOW
28/01/2020 12:50 PM
calvintaneng Falling value and output raise questions about S'pore chemicals hub

https://www.businesstimes.com.sg/energy-commodities/special-feature-jurong-island/falling-value-and-output-raise-questions-about
28/01/2020 12:54 PM
Sslee Hahahaha,
Calvintaneng London Biscuit do not have FCF. Pchem will be must better than FD.
28/01/2020 12:59 PM
Philip (Can I advise you?) This is exactly the point. If you were investing in the amounts of money like choivo does, any capital loss he makes is easily recoverable by putting in extra overtime in his job.

For me investing large capital is an added pressure in that the investment itself has to be barred on the a safety of capital point of view, and since I am no longer tied to using profits to live on a daily basis, I am able to take a longer view on things and what to buy.

In these cases, buying and keeping for a longer period of time becomes more rewarding.

I am reminded of my long term investment in topglove, I had put in on a backend due to my annoyance at the company from its recent acquisition without full due diligence, and had expected it to take a few more years to recover its earnings.

Suddenly due to a virus, everyone is buying any available stock in topglove, just like how Mr market would act. I expect even more insanity when topglove shows worthwhile results and the price excludes further.

And even QL is impressive after all the comments on pe50 etc etc, the earnings keep growing, the confidence keep coming up, and say 6.7 last year today it is up to 8.17 with dividends growing while all the naysayers keep standing at the bylines.

All I can say is, PCHEM is far safer than many companies like lctitan. You don't have to worry about any cash calls or share dilution or private placements. You don't have to worry about any dividend reduction as their payout is still 50% of earnings. And it has 12 billion of cash in the bank to ride out any crises.

For those who don't buy, then I hope you spend the next 5 years following this company closely and looking at the long term results.

For those that buy, I hope you have the patience I had when I first bought my ten baggere in ql and topglove, which I am still holding until today.

For those that are considering selling, I hope you can answer the million dollar question, sell and buy what? Which is the better investment?

As Jonathan 5000 investment thesis into rcecap historical over 5 years, or timecom, or aeon credit, e investments you don't make matter as much as the investments you made in life.

Luckily I have had a long time to buy and look at the market too see when you have a discount day, and when you have a structural failure of the business.
>>>>>>>

Joon Chan Of course there are better.
Risk is opportunity cost to me.
But where would you park 5m or more?
25/01/2020 12:51 AM
28/01/2020 1:00 PM
Icon8888 Surprised it drop so much due to virus

Why ?
28/01/2020 1:02 PM
Philip (Can I advise you?) I would say during good times, people become over optimistic on a business future, during bad times people become negative on a company future.

I'm more surprised and scared that my topglove jumped so much higher than I believed it would.

People overreact to many things, but this year its more than normal share.

War in middle East. Coronavirus. Stock market overheating.

I start to believe more and more than investing is more about emotions than analysis.
It becomes really hard to keep a level head of everyone around is running around screaming the sky is falling.

But I just keep asking myself, what is PCHEM long term prospects? Am I buying it below the intrinsic value and the earnings generated for the business?

So I still come to the opinion that Pchem is wonderful company selling at a wonderful price now.
28/01/2020 6:18 PM
Choivo Capital I don't disagree that much on the business to be honest.

However, when LCTITAN is half the valuation of PCHEM, you do need to think a bit more.

Having said that, my PCHEM position size is actually a little bigger than my LCTITAN one, despite both being relatively small.



PS.
Lets swap financial positions then. =]

I like how someone with RM50m in the stocks, with little leverage is talking as if he's living on knife's edge. One month FD interest on that is enough to put you very comfortably in the T20 household income category. You'd probably need a bit more for travelling.

Every sen of capital loss i incur, takes me further from my "number", which will enable me to never need to work for money again.

Not swapping our ages though.

=====
Posted by Philip (Can I advise you?) > Jan 28, 2020 1:00 PM | Report Abuse

This is exactly the point. If you were investing in the amounts of money like choivo does, any capital loss he makes is easily recoverable by putting in extra overtime in his job.

For me investing large capital is an added pressure in that the investment itself has to be barred on the a safety of capital point of view, and since I am no longer tied to using profits to live on a daily basis, I am able to take a longer view on things and what to buy.
28/01/2020 6:35 PM
Joon Chan All my indicators bleeped sell, at every data interval.

I hesitated - but in this panic, it makes sense to sell and buy back the equivalent shares in t+2 days time for a contra-gain in cash or shares.

The probability of a recovery within 2 days is low.

I'm fundamentally long - so isn't the goal to increase/maintain the position in terms of shares?
28/01/2020 8:13 PM
Icon8888 Thought you are a long term investor ?
28/01/2020 8:22 PM
Joon Chan Exactly. So why shouldn't profit from a short term shock?
Long/Short, same thing - a bet in direction but in different timeframs.
Long over years, short over 2 days.
28/01/2020 8:53 PM
28/01/2020 9:53 PM
Joon Chan @Icon8888
If you are holding unencumbered 1000 shares.

You can sell 1000 lots 6.75 in in the morning when it just started selling down, and buy 1000 lots again in the evening at 6.64.

The difference of 11 cents per share will be your gain in cash, RM11k in cash, or buy 1.6 more lots.
28/01/2020 10:24 PM
Philip (Can I advise you?) Joon Chan, my advise is to not look at short term stick volatility as there is no way you can predict how the share price will work out in the short term. Trying to time the market will always be an exercise in futility. When I was young in the 80s I tried to time the market, it didn't work. I then tried to time the market in the 90s, it also ask didn't work. You may be too young to remember renong, aokam and alta vista, but my prognosis is always hindsight is perfect. But in reality, if you have been losing big money in a stock, it becomes harder to buy back when you sell it, or even to just buy more as it goes down. Trying to trade dips is just something all the sifus like to teach in their classes, but rarely do they have a solid long term portfolio which they are willing to show you.
28/01/2020 11:17 PM
Icon8888 the petrochemical industry in my opinion is a bit similar to steel industry nowadays

It is hugely influenced by supply from overseas (especially new plants capacity), that diminishes it earning visibility

Very difficult to predict prospects both short and Long term
29/01/2020 6:38 AM
Icon8888 In other words lack of moat
29/01/2020 6:57 AM
Lukey_Greek The outlook is bad for mid term (2-3 years). Petrochemical price keep dropping due to excess supply & drop in raw material price.
29/01/2020 9:30 AM
popo92 my biggest concern is also the diminish of moat, supply seems coming from many places globally. Many is aiming southeast asia market too. my insight on this is fairly incompetence although i am still holding big on pchem.
29/01/2020 10:39 AM
Sslee Dear all,
Petrochemical is like oleo-chemical you need the economy of scale, the latest most efficient process technology, upstream for security of feedstock, big cluster/complex to save on internal transport cost and big storage and logistic to lower your logistics cost. A single stand alone petrochemical company without above support will be killed by this fully integrated petrochemical company.

Thank you
29/01/2020 10:46 AM
Choivo Capital Joon,

I'd listen to phillip when it comes to short term trading.


Icon8888,

For other petrochem co's yes. However, those with natural gas as a primary feed stock is a little different. There is a "geographically blessed" component.

IE you need to be in the right place, to do it at the right price/cost. If you're not in the right place, you won't make a profit, as your cost will just be too high.

PCHEM is good, not so much because management is competent etc, but because its a good business due to them being geographically blessed, and their management is not retarded (not smart, but at least not retarded).

I would only worry if they start thinking about going into palm oil, refinery fabrication something stupid like that, which is completely not in their circle of competence.
29/01/2020 11:32 AM
Icon8888 maybe need some patience

things are messy now
29/01/2020 12:28 PM
Lukey_Greek The feedstock of the new plant is oil compared with their existing plant which use gas. Margin is much thinner. Hence, the profit will be volatile depend highly on oil price movement.
29/01/2020 12:32 PM
Lukey_Greek Another reason of the cheap petrochemical price is due to raw material using by products of shale gas. Plant using oil is hard to compete.
29/01/2020 12:36 PM
KooSan Hello....the dividend is even better than your FD rate. Otherwise put your money under your bed.
So please la stop giving cock stories and try to be expert and advise people
29/01/2020 12:57 PM
Icon8888 the problem with this stock is that nobody (in this forum) does a detailed analysis

a lot of broad concepts by sslee, Philips etc

but many things said later turned out to be only partially true or need to be qualified

as good as no analysis



Lukey_Greek The feedstock of the new plant is oil compared with their existing plant which use gas. Margin is much thinner. Hence, the profit will be volatile depend highly on oil price movement.
29/01/2020 12:32 PM

Lukey_Greek Another reason of the cheap petrochemical price is due to raw material using by products of shale gas. Plant using oil is hard to compete.
29/01/2020 12:36 PM
29/01/2020 1:00 PM
Icon8888 I don't own this stock so I have no incentive to investigate in depth
29/01/2020 1:01 PM
chl1989 waiting at rm6
29/01/2020 1:24 PM
Joon Chan Philip, choivo, i do appreciate the advice.

Guys, i'm sorry. But i don't see the logic in not selling early in a clear knee jerk reaction. Only to pick up the shares at the end of the day, or next day. Given the kind of reaction, the stock is not instantly going to do a 360 degree turn and meteor up to where it used to be (contextual situation applies)

Maybe if your position is very big, then it's not feasible. But for most retailers, with 1m or less, you are in and out.

But otherwise, if you already have a position in the stock, and you believe it's long term prospects. This means no matter what you'll ride the knee jerk right?

Like today, there is a rout on Topglove, as expected since the virus looks to be slowing down. Why would you not want to cash out at 6, and buy TopGlove again at whatever, 5%, 4% lower. You can set the limit buy, and you get your price.

Price follows the path of least resistance, its not difficult to spot a panic selldown, or a mania uptrend.

Volatility is the friend. If one loads up on these discount events. Taking outside money to buy more, vs selling current position to buy more, what's the difference? Isn't it also timing? Isn't it a bit riskier as you've added capital?

A few chances like this, could make a 2-3 bagger, into 5 bagger, over the cycle Same risk,same stock,same prospects. Just a few days of going short over 600 days.

I'm not trying to be argumentative, but i just cant grasp sitting by and letting the stock take a temporary hit.

"Trying to time the market will always be an exercise in futility. When I was young in the 80s I tried to time the market, it didn't work. I then tried to time the market in the 90s, it also ask didn't work. You may be too young to remember renong, aokam and alta vista, but my prognosis is always hindsight is perfect. But in reality, if you have been losing big money in a stock, it becomes harder to buy back when you sell it, or even to just buy more as it goes down."

I'm curious as to how you've tried to do it in the past, and came to decide it was futile? ^^ I wasn't old enough for renong, but my late father did condemn it very often. Altavista? The search engine?
29/01/2020 2:57 PM
i3lurker you can be saved by buying Insas.

Posted by Sslee > Jan 29, 2020 10:46 AM | Report Abuse
Dear all,
Petrochemical is like oleo-chemical you need the economy of scale, the latest most efficient process technology, upstream for security of feedstock, big cluster/complex to save on internal transport cost and big storage and logistic to lower your logistics cost. A single stand alone petrochemical company without above support will be killed by this fully integrated petrochemical company.

Thank you
29/01/2020 2:59 PM


 

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