Posted by Lincorn Matthieu Seven > 2016-09-06 09:51 | Report Abuse

well done!!!!!!!!!!

Posted by murali > 2016-09-06 09:53 | Report Abuse

TQ for the sharings.

Posted by i3inverstor > 2016-09-06 10:00 | Report Abuse

great

Posted by warmblood > 2016-09-06 10:07 | Report Abuse

HI Sir, wanna know how you got the utilisation percentage of each counter?

Posted by moneySIFU > 2016-09-06 10:27 | Report Abuse

Wow, very detailed working & solid projection, great sharing!!!

Posted by probability > 2016-09-06 10:37 | Report Abuse

real Wizard...i like the style of presentation

Posted by wealthwizard > 2016-09-06 10:57 | Report Abuse

Thank you everyone

Posted by wealthwizard > 2016-09-06 10:58 | Report Abuse

warmblood, thanks for highlight, here you go & I have add into the article also.

To know respective CRC companies' utilisation of the production capacity, please read page 7 of the following report: http://cdn1.i3investor.com/my/files/dfgs88n/2015/11/06/1483789631--639706738.pdf

Posted by warmblood > 2016-09-06 11:49 | Report Abuse

Thanks wealthwizard.
i believe cscsteel will have higher utilisation this year as they can get stock from their sister and mother company.
but Q3 profit should be lower than Q2.

one more question, do sir have the local CRC and CRC related product selling price In Malaysia?
just can get from friend working in steel company? usually i have is rebar steel price.

Posted by moneySIFU > 2016-09-06 13:11 | Report Abuse

Even put a discount of 20 percent over profit projection, with forward PE 5 times, the fair share price for mycron will be RM0.895, still far from current price of RM0.695, still deep undervalued, the short term upside potential represent HUGE 29 percent!!!

Posted by soojinhou > 2016-09-06 13:49 | Report Abuse

Thank you for sharing.

Posted by IBanker > 2016-09-06 17:31 | Report Abuse

hi wealthwizard..i'm going to buy more aggresively tomorrow..still got part 3?

Posted by wealthwizard > 2016-09-06 17:53 | Report Abuse

Hi Ibanker, I am currently working very hard on part 3, not yet decide on the title, but will dig deep into the financial figures of mycron. From there, hope we can figure out together the true picture of mycron's future.

Posted by probability > 2016-09-06 18:16 | Report Abuse

today's phenomenon on Mycron was just a balancing act between CSCSTEEL and other manufacturers in terms of P/E..excluding other valuation factors.

Tomorrow either both shall dip or....

Posted by moneySIFU > 2016-09-06 23:42 | Report Abuse

Haha, good observation, probability.

Share investment is always unpredictable, who knows tomorrow up 10 cents again? or may be resting for a while? Or become cheaper so we can collect again? (⊙‿⊙)

Posted by probability > 2016-09-06 23:45 | Report Abuse

:)

Posted by moneySIFU > 2016-09-06 23:53 | Report Abuse

It's not easy to find hidden undervalued stock, luck play important role in finding the one.

Even when you spotted it, you may still overlook it.... I did it every now & then...

Posted by Jay > 2016-09-07 10:23 | Report Abuse

thanks wealthwizard. unusually informative article on the steel sector. i think in the past many have shy away from the steel sector (for good reasons). would like to know your views of the changing trend in the sector (higher steel price, lower cost etc.) and whether are they sustainable. steel companies mostly have done very well in 2Q but many (including me) worries if this is a 2,3 quarters wonder...

Posted by wealthwizard > 2016-09-07 14:03 | Report Abuse

Hi Jay, CRC companies faced 2 main issues over the past years, all crc companies are instructed by MITI to take raw marerial supplies (scrap based HRC) from megasteel only, which about RM400 more expensive than those hrc imported from oversea.

All crc companies are only allowed to import ore based hrc.

Megasteel is now closed since Feb 2016 and even its senior manager said in the news that only miracle can save megasteel, so everyone are now sourcing hrc from oversea, a huge saving in raw material cost.

Imagine some stocks used for production during quarter 30/6/2016 were those purchased with old price, but yet every crc companies had already started to deliver good result, how about coming quarters?

On the other hand, Government has imposed anti-dumping duties for all crc from certain countries. This is a big WOW factor.

My personal guess, it will last for at least 1 year, similar to those export companies.

Posted by wealthwizard > 2016-09-07 14:10 | Report Abuse

I missed out another issue, import of cheap crc from certain countries, but this has been resolved with the imposition of anti-dumping duties by malaysia government.

Posted by i4investor > 2016-09-07 15:11 | Report Abuse

How about YLI?

Posted by moneySIFU > 2016-09-07 15:15 | Report Abuse

YLI is not operating in the steel industry

Posted by moneySIFU > 2016-09-07 15:18 | Report Abuse

Found this in their annual report:

The principal activities of the Group consist of manufacturing and trading of ductile iron pipes, steel and plastic pipes and fittings and waterworks related products, construction work and project management for waterworks and sewerage industry.

Posted by i4investor > 2016-09-07 15:25 | Report Abuse

This steel stock got potential as i got one good target price infor about this stock but i dare not enter due to it still in loss financial?

Posted by moneySIFU > 2016-09-07 15:33 | Report Abuse

Don't get what you mean about loss financial

Posted by Jay > 2016-09-07 15:34 | Report Abuse

from what I understand, steel price has tracked china sudden surge in demand, which is then followed by iron ore prices increase (the raw material). so would it be correct to assume that local steel producers are benefiting from higher selling prices due to increase in global steel price and enforcement of anti-dumping, while raw material cost didn't increase as much mainly because they don't need to source from megasteel anymore? or is it also possible that the recent quarter results increase in margin is because the steel players are drawing down from old inventories (purchased at last year's price, cheaper than now even if it's was from megasteel) while steel price (selling price) has increased? so the timing mismatch resulted in higher margins? and if steel price (selling price) correct down together with iron ore (raw material price), do you think local steel producers can maintain their current margins? sorry for a lot of questions, just hoping to get a better understanding of the industry dynamics since you seem to have done quite some homework. thanks

Posted by moneySIFU > 2016-09-07 15:56 | Report Abuse

It's ok, Jay, we are discussing to learn more from each others.

I will advise you to read annual reports & quarterly reports of CSCSteel & Mycron for the past 2 years, those questions were actually answered.

Chairman's statement of Mycron is the best so far if compared to others.
http://cdn1.i3investor.com/my/files/dfgs88n/2015/11/06/1483789631--639706738.pdf

Posted by Jay > 2016-09-07 16:16 | Report Abuse

I have read the Mycron annual report and some other quarterly commentaries. basically most quarterly statements summarise the better performance due to better selling price and lower costs (more or less) without giving the underlying factors (except Mycron AR). that's why I wanted to confirm my 1st question based on what I understand from wealthwizard's articles.

for the 2nd question, I can't find any confirmation except from observing the HRC/CRC/steel rebar/iron ore prices. it's my speculation. if it's true, then the better margins in 2Q could last shorter than expected.

3rd question actually is a bit tricky. probably even the companies also can't have an exact answer on how they could cope with prices fluctuations but I just wanted to see what everyone thinks about it.

Posted by wealthwizard > 2016-09-07 16:24 | Report Abuse

Thanks, moneySIFU & Jay, for having good discussion over here.

I am working on Part 3 article which will dig deep into Mycron accounts, from there we may have better & true picture about CRC & HRC industry. Hope to have it completed by tomorrow.

Posted by i4investor > 2016-09-07 17:27 | Report Abuse

Mean YLI still making loss

Posted by probability > 2016-09-07 17:52 | Report Abuse

strange...why this article did not hit no.1...

Posted by chl1989 > 2016-09-07 20:40 | Report Abuse

Wealthwizard, could you share the supply chain of steel? From hrc to crc to??? Who are the big buyers for cscsteel? Are they in construction segment? Tq in advance :)

Posted by moneySIFU > 2016-09-07 23:35 | Report Abuse

Hi probability, this article hit No.1 for one or 2 hours, then down to no.2 most of today.

Posted by probability > 2016-09-07 23:46 | Report Abuse

ok...then fine...means no manipulation. Thanks $$-sifu

Posted by wealthwizard > 2016-09-07 23:49 | Report Abuse

Feel great already for articles being seen by so many investors & readers. :)

Posted by chl1989 > 2016-09-07 23:50 | Report Abuse

very conservative tp for cscsteel :)

Posted by wealthwizard > 2016-09-07 23:50 | Report Abuse

As a new guy to i3 community, thank you for giving chance to share.

Posted by chl1989 > 2016-09-07 23:54 | Report Abuse

PE should be rated higher with its high div payout and cash position :)

Posted by chl1989 > 2016-09-07 23:55 | Report Abuse

at annualized profit of 110mil, its div yield is crazy :)

Posted by wealthwizard > 2016-09-08 00:02 | Report Abuse

Hi chl1989, I can only analyze based on annual reports from those CRC companies and try to figure out the true pictures from those accounts.

Most of my findings are based on CSCSteel & Mycron, these 2 are very generous in sharing the info & details of their businesses, especially Mycron.

For Eonmetal, nothing much thing can be digged out because they are giving too little info from their reports.

See what the eonmetal management explained on increase in profits:
"This segment recorded PBT of RM0.6 million, a rise of RM1.3 million is in line with the increase in revenue." - Plant & Machinery Division

"This segment recorded PBT of RM3.8 million due to lower production costs" - Steel Division

YKGI was up & down, also not much things to be digged out.

Posted by wealthwizard > 2016-09-08 00:03 | Report Abuse

chl1989, I totally agreed with you

Posted by wealthwizard > 2016-09-08 00:05 | Report Abuse

There is priority issue need to be set for respective stocks, I think Mycron should go first since there was misunderstanding by many in reading their latest QR.

Posted by wealthwizard > 2016-09-08 00:06 | Report Abuse

Also, being conservative is always good, just let the market to decide what's best should be

Posted by moneySIFU > 2016-09-08 00:23 | Report Abuse

Thank you for sharing, wealthwizard

Posted by chl1989 > 2016-09-08 00:40 | Report Abuse

I will try to email their IR. See if i can find out what is the biggest end-use industry which their products going into :)

Posted by moneySIFU > 2016-09-10 09:26 | Report Abuse

At price of RM0.785, the Forward PE = 3.5

The market value of Mycron is RM221.8m
Projected next year's profit = RM63.3m
Projected next year's cash inflow = RM87.7m

Posted by LouisLim > 2016-09-11 13:20 | Report Abuse

Hi moneySIFU, WealthWizard,
May I know how Mycron "Projected Next 4Q" profit RM63,282,000 being calculated? As normal calculation, it will take latest quarter profit 9,336,000*4=37,344,000. Can you show me how to get accurate value RM63,282,000? Just wish to learn from you. Thank you.

Posted by moneySIFU > 2016-09-11 14:02 | Report Abuse

Hi LouisLim, the impairment loss may only occur in the 4th Q of the company, after receiving the valuation report done by the professional valuer, C H Williams Talhar & Wong Sdn Bhd.
http://www.bursamalaysia.com/market/listed-companies/company-announcements/5190321

Impairment loss for 2015 was RM3.46m & 2014 was RM6.35m

Posted by moneySIFU > 2016-09-11 14:04 | Report Abuse

So, when calculating Q1 to Q3 result, you need to take out impairment loss. That's how figures in the Table 5 derived.

Posted by ruslimz > 2016-09-11 22:33 | Report Abuse

excellence report......we need you here.....