Thanks probability and soojinhou for your comments. I corrected Rapid to 2019 but normally with some technical challenge and big investment required, it has the possibility to delay.

https://klse.i3investor.com/blogs/davidtslim/128681.jsp

Part 2 of Hengyuan article

https://klse.i3investor.com/blogs/david_petronm/128667.jsp

Chinese version

My part 2 of Hengyuan maybe publish on this thursday or friday,
Stay tune

Probability: My calculation try to be conservative. When the actual result released in Aug are better than my estimated profit, this can give market a surprise and triggers a strong buy.

Probability: I get your point. I also thinking of higher days of crude oil stock but I hv no data from AR to refer.

I think cash flow can be higher than earning in coming Q2 results. I think a spectacular cash flow in Q2 is likely to happen.

The crude oil stock maybe more than 18 days as its inventory value is high.

Probability: It seem that refinery margin keeping its momentum in Q3'2017. Hengyuen super high profit in Q1'17 maybe can be repeated in Q3 or Q2.

https://klse.i3investor.com/blogs/davidtslim/128328.jsp

My new writing on Hengyuan

Hope can keep in touch with u by email or other mean.

probability: A lot of your comment help me to understand a lot refinery biz and improve my analysis skill. Thank a lot.

probability: Do u know whether Hengyuan is running at their full refinery capacity now or (also run full in last Q)? Is it the shut down for maintenance is only in 2018? It is look very interesting for me for Hengyuan now.

https://klse.i3investor.com/blogs/david_petronm/127944.jsp

My new article

Tq.

I am considering to write another article on how to judge a Management team.

https://klse.i3investor.com/blogs/david_petronm/127594.jsp

Part 3 of petronm. This should be my last part sharing for petronm if no new idea

Consider to write part 3 if you think needed. Still hv some idea and point to share for Petronm

yup thats what i think may be from Petron Philippines...any info from AGM?

Feedback: I remember noboday ask this question in AGM. No info so far.
Good news is they have flexibility to increase their refinery throughput for low sulfur crude oil. In addition, they said no maintenance shut down in 2017. Management replied to question that they are confident to repeat the Q1'17 performance in AGM.

If x = 2, you can work out that the Fuel crack spread has to be at least on the positive territory (more than > 0 USD/brl crack spread) with gasoline crack spread at 7 USD/brl for Option A to generate same or higher earnings than Option B.

This is possible if they facility can handle it.

They are selling 8.3 mil barrel in Q1'17, due to they refinery throughput is only 4.3 mil barrels, so ~4 millions barrels are bought from competitors for trading. I guess these 4 mil barrels are purchased in the form of finished refined products.
How much the profit can be get from this trading? It should be less than if they refine the crude oil and selling the finished products based on current refinery profit margin?

Thanks for your calculation. Good question on whether their hydrotreater can handle or not. Petronm mentioned that they are compliant with Euro 4 spec but some asked me whether they already compliant with both RON97 and RON95 fuels? Some said they just compliant with RON97 only? Do you have info on this?

Thanks probability for your sharing on 48kbpd capacity. The option A and B is your own estimation or any official statement from Petronm? Is it possible current higher profit margin for gasoline and diesel products make it possible to run at higher throughput using low sulfur crude oil (as what HY doing)?

Thanks 逍遥子 for your 2 additional points for Petronm. We will be clearer in August for its free cash flow level. I expect they can reap good profit from refinery business in Q2.

May write part 2 of Petronm fundamental later

http://www.cnbc.com/2017/07/05/shell-director-says-downstream-business-fundamental-to-paying-off-debt-maintaining-dividends.html

Probability: I hv deleted.

First of all thanks for your confirmation and advise on my calculations. Brent oil price (48.2) is based on closing price at 00.00 time on 1 July.
Regarding your concern on the the Service stations inventory (10 days claimed by some news), I think now they will reduce to 3-4 days inventory as weekly pricing system (3-4 day is rule from government if I am not mistaken). As what I read the news, dealers seem cannot determine or decide the volume of gasoline to keep as its depending on the companies (Petronm). I think dealer will suffer some inventory loss even 3-4 day stock but I wonder Petronm need to share the loss or not?

They mentioned in their AGM their profit per litre is 5 sen (not sure fix or depend on weekly price movement). Anyway, from management reply in AGM, they are confident on repeating the Q1'17 profit. I think they also do some hedging on their finished refined product and also import price of gasoline so that their risk is minimized.

As per Jinhou's comments, is it when RM appreciate against USD, Petronm will enjoy forex gain? I tried to read AR report on its sensitivity on its foreign currency (seem it like RM to appreciate but I am not too sure).

Probability: I hv one question on your Throughput figure of 4300k barrels per quarter. How you get this figure? Based on management reply in recent AGM, its refinery capacity running at 60%. Its daily max capacity is 88k bpd. 60% should get 52.8k per day which lead to 4752k barrels per quarter.

Brent oil stay above USD48 today, mean their stock loss will be reduced while they still enjoy decent refinery profit. Of course, their petrol retails biz is is as usual (even boost up by Raya holiday in June)

Probability, currently Brent oil price around USD48. Is it mean stock loan can be much reduced from our earlier calculation? What is the reference oil price of stock loss/gain calculation?

Brent oil rebounded to 47.5

Oil and gas will be low for some time. If u really study knm n its boss records then you know whether it got future or not.

KNM margin is so low. Cash flow maybe getting tighter later. ROE so low. NTA is a trap as a lot of Intangible. So many project delays (like UK peterb) and debt so high are really risky. A more potential sector will be steel.

If can only earn certain margin type of rate, 5sen per liter in Malaysia, then why say oil price goes up margin goes up? Petronm got 30% refined products coming from commercial (jet fuel, LPG).

https://paultan.org/2017/06/21/caltex-petrol-station-closures-chevron-responds/

Petronm daily refinery capacity is 80k barrels. I believe they already run in full cap based on their quarter report 8.3 mil barrels sales. Is there they import some refined oil for local sales? Is petronm plant also ready with Euro 4 production? I know hengyuan is still not ready with Euro 4 if not mistaken

逍遥子 and Alex: I may want to attend the AGM also. Can I join your coffee session on that day? I think Petronm really potential and I wish to know more from this AGM. Thanks 逍遥子 sharing so far.

From their results, RM400 mil profit for 2017 is very likely. Remember Q1 of 2017 is traditional weak season for Petronm but this Q1'17 they still can deliver an increase revenue and close to peak season profit of Q4'16. If can deliver 400 mil, then whole year EPS can reach 160 sen++

Petronm cb still traded at negative premium, which is very are in call warrant.

Petronm got expansion plan that going to implemented and also has growing biz, decent dividend, we can see the future.

It is also possible to buy low crude oil price and selling at higher refined price.

Jay: I think it is should be inventory gain, not loss as malaysia petrol price in Q12017 is up in Jan and Feb.

http://www.enanyang.my/news/20170518/petron%E6%8B%9F%E6%8A%95%E8%B5%8465%E4%BA%BFbr-%E5%8D%87%E7%BA%A7%E5%A4%A7%E9%A9%AC%E7%82%BC%E6%B2%B9%E5%8E%82/

They can accumulated some shares, but Petronm free flow shares not much and I doubt how much they can accumulate, once got strong buying interests, price will go up as in past 1 week. All Investment banks got many Call warrants from many counters. I doubt they can buy all their issued call warrant Mother to control the price. I guess they never think mother can go up so much as their ratio of conversion is very very high for CC and not low for CB also

This bull time many call warrant issuers suffer loss. I think they cannot do much unless they got mother shares in hand.

I think RXX investment bank may not able to do much to press down the price of mother. Unless they got a lot of mother shares or can borrow from someone. Even they do so, once good result released, they still suffer loss in mother if they borrow someone share to dump now.

Total Borrowing :
Q4: 1,321,595,000
Q3: 981,357,000

Pay interest also super high cost. Last quarter finance cost is 17 mil. Really very very poor company. No future at all for its biz.

I agree for long term or even short term, takeover of Triplc is good deal for Puncak as concession biz is easy biz and no much risk and recursive. Just not sure they can complete the deal by 2nd quarter of this year? They key is Rozali cannot vote in both Triplc and Puncak EGM in this deal, possible he has to ask his geng to buy more share in Puncak and triplc to vote yes for this deal?

Jay: I give thump up for your knowledge in listing regulation and strong analysis skill in share investment. Moreover, you also willing to share your view and knowledge. I know before your sharing that SC won't and not be able to propose capital repayment for any counter as no such thing in their role and capital repayment all depends on board of directors decision. One funny thing is Puncak got cash of RM2.5 per share, even director willing to propose capital repayment, they won't pay all of their cash to shareholders or selected minority shareholders. One must think logically and back to realistic in share investment.

Jay: just to confirm dividend declaration for a PN16 company need to depend on retained earning? TRIPLC may improve further their retained earning in coming two quarters.

Negative flow most of the time and that why knm got a few cash calls (right issue) which shows them lack of cash (cash in account maybe from Borsig which cannot touch). Borrowing is too high and the earning may not even enough to pay interest. Too many oversea investments which maybe hard to manage.