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Engineering Department a Drag on Earnings
Ever since my last posting on Melewar, the NTA now is at RM1.16, down from the previous RM1.35. With the earnings per share to date of -21.15cents, one can only imagine just how much more provisions have to be made before it starts to turn to the black.

At the price of 31 cents at the time of writing, Melewar investors may be in for a further disappointment after getting to know the extra provisions that the company has made for the past many months owing to the cost overrun suffered by their Engineering Department. Just how many more provisions may be made for this project is yet to be known.

The company is not giving any more hints on that part except to write a not-so-bright future on Melewar. Definitely there is an end to this extra capital being poured into the projects. Feasibility is a matter of concern for any companies and cost cutting measures have to be taken in order to reduce or just to put an end to all these hole patching jobs. Fret not, the end is near.

Bears May Have Left Melewar
The quarterly report was posted on 23 Feb 2017. On the very next day, exactly only 39,530 shares were traded and the share price closed at 0.335 at the end of the trading day. No heavy selling was seen on the days after that which may seem that the bears are no longer clinging on to Melewar. When you don't have sellers, it is just a matter of time before buyers start to take charge.

Another Fund Raising Exercise May Be On The Card
With the share price at a par value of RM1, things may not look so dim after all. If history repeats itself like in 2014, the share price rose to the range of 0.5-0.6 cents in a matter of a few weeks from about 0.2-0.3 cents per share due to the news of share placements by the company. Another exercise in the near term, and the price may go higher again.

Even if share placement is not done in the next couple of months or so, any proposal or hint of a share split or fund raising activity will surely move the counter to the higher side.

Mycron's Profit Needs to go Higher
Although the profit contribution of its 70% held company may not be able to help the company's financial statement to breakeven, this may change for the better with more orders secured by Mycron and the protection allocated to the local steel industry is just on its first year of implementation. We still have a long way to go.

Just you wait, Melewar.