The company's net cash position is actually more than RM 600mil or more than 55 sens per share if we include the investment securities which are debt and money market securities.
The growth for CMSB will actually come from their interest in the Phosphate business. Management is projecting that the business will turn cash flow breakeven in the current FY and P&L breakeven in 2024. By 2025 they are projecting that the business will deliver a PATAMI of RM50 mil to the group annually. That being said, all of this is based on the yellow phosphorus price of around USD4,000/MT. Current yellow phosphorus price in South East Asia is more than USD7,000/MT and in China it is around USD 5,300/MT. Refer to link: https://businessanalytiq.com/procurementanalytics/index/yellow-phosphorus-price-index/
Another growth potential will be their new O&G business that they acquired from Scomi. CMSB is considered as the front runner for the USD 400mil Petronas' drilling fluids tender in Sarawak. The current contract will end in 2H23 so the award should be made soon. Still not clear on the potential profit margin of this tender. Appreciate if anyone has an insight on this. My friends in the O&G industry indicate that it's around 10 % profit margin but they are mostly operational guys and not really financial. So not sure of their numbers. Thanks.
Stock: [CMSB]: CAHYA MATA SARAWAK BHD
2023-02-27 23:07 | Report Abuse
The company's net cash position is actually more than RM 600mil or more than 55 sens per share if we include the investment securities which are debt and money market securities.
The growth for CMSB will actually come from their interest in the Phosphate business. Management is projecting that the business will turn cash flow breakeven in the current FY and P&L breakeven in 2024. By 2025 they are projecting that the business will deliver a PATAMI of RM50 mil to the group annually. That being said, all of this is based on the yellow phosphorus price of around USD4,000/MT. Current yellow phosphorus price in South East Asia is more than USD7,000/MT and in China it is around USD 5,300/MT.
Refer to link: https://businessanalytiq.com/procurementanalytics/index/yellow-phosphorus-price-index/
Another growth potential will be their new O&G business that they acquired from Scomi. CMSB is considered as the front runner for the USD 400mil Petronas' drilling fluids tender in Sarawak. The current contract will end in 2H23 so the award should be made soon. Still not clear on the potential profit margin of this tender. Appreciate if anyone has an insight on this. My friends in the O&G industry indicate that it's around 10 % profit margin but they are mostly operational guys and not really financial. So not sure of their numbers. Thanks.