Posted by paperplane2016 > 2017-07-21 18:21 | Report Abuse

another great work! master piece. I am more interested in the Free cashflows.

Posted by Tom > 2017-07-21 18:42 | Report Abuse

记得 Alex Xu 早就分享过关于 refinery 股 的看法。。。。。

Posted by probability > 2017-07-21 19:13 | Report Abuse

https://www.arabfinance.com/2015/pages/news/newsdetails.aspx?Id=402202&lang=en

Posted by supersaiyan3 > 2017-07-21 19:36 | Report Abuse

I hate environmental polluting corporations.

http://ejchina.blogspot.my/2014/05/blog-post_5322.html?m=1

I rather pick petronm and pchem.

Posted by supersaiyan3 > 2017-07-21 19:52 | Report Abuse

For those who do not read Chinese, I provided a news report link on the parent company of Hengyuen. The news was published by an environmentally concern reporter in 2012.
It said Hengyuan Shandonghas been polluting the nearby area through directly channel dark-color waste water into the drainage and black smog spreading tenths of mile, creating problems such as undrinkable underground water, sickness etc.
We all have choices. May goodness be with you.

Posted by supersaiyan3 > 2017-07-21 20:06 | Report Abuse

http://www.youtii.com/news/html/2017/4/94549.htm

This is a news link that Hengyuan Shandong is fined rmb400,000 for refuse to comply with environmental law, this happen as recent as April this year.

Posted by probability > 2017-07-21 20:53 | Report Abuse

it just touched record high! :

http://www.cmegroup.com/apps/cmegroup/widgets/productLibs/esignal-charts.html?code=D1N&title=JUL_2017_Singapore_Mogas_92_Unleaded_%28Platts%29_Brent_Crack_Spread_&type=p&venue=0&monthYear=N7&year=2017&exchangeCode=XNYM

Posted by supersaiyan3 > 2017-07-21 20:58 | Report Abuse

As recent as Jan this year, Hengyuan shandong was penalised.

http://news.iqilu.com/shandong/yaowen/2017/0126/3361662.shtml

Posted by probability > 2017-07-21 21:02 | Report Abuse

If you see the above article i posted on Ruwais refinery, what is most mind-boggling is this:

"they are now mainly producing Fuel Oil as they could only operate their Hydroskimming unit as their Catalytic Cracking unit for Higher conversion to Gasoline (and other lower hydrocarbon chain lengths) is the one damaged due to the fire"

Despite all this the Singapore Fuel Oil Crack spread is currently shooting sky high...meaning there are so many other factors that are conducive regionally to maintain a healthy overall refinery margins.

Posted by davidtslim > 2017-07-21 22:05 | Report Abuse

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.

Posted by probability > 2017-07-21 22:28 | Report Abuse

yeah David...i am certain by the time Q3 results are out (just 4 months away), HRC would be in a completely different class.

Posted by davidtslim > 2017-07-21 22:36 | Report Abuse

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

Posted by probability > 2017-07-21 22:39 | Report Abuse

yup, that is one point i wanted to correct you, but leave it...as there are safety margins on your refining margins, throughput, forex etc. Even if its way lower it does not matter.

Inventory down valuation does not affect cash flow, i.e will cause cash flow to be higher than earnings. I am hoping for a spectacular cash flow on Q2!

Posted by davidtslim > 2017-07-21 22:46 | Report Abuse

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.

Posted by pitbull > 2017-07-21 22:53 | Report Abuse

Yup..i also expected Q2 ard 65 eps

Posted by probability > 2017-07-21 22:53 | Report Abuse

market has now realized Not to link Oil price with Refinery Performance i.e Margins..same way they will realize stock loss or gains are temporary effects which will be having zero cumulative effects just like how you take out non-core operating profit (one off gains/loss) to value the stock based on core operating profit.

I was a bit concern on inventory loss effects on Reliance India results using a a greater delta change on Brent pricing than u had used, but their results proved otherwise, meaning your basis on delta price are probably more correct.

Posted by pitbull > 2017-07-21 23:51 | Report Abuse

Now is I.T generation..1 ppl amend thn behind will follow very fast

Posted by stockraider > 2017-07-21 23:52 | Report Abuse

Raider says...people are too worried about refinery earnings loh...!!

U need to understand loh...HRC trading at PE 3x...why leh bcos sceptical about refinery profit sustainablility loh...!!

Also people worried about inventory losses too loh !!

Put it this way loh....!!
At PE 3x....HRC is generating 33% return pa loh...!!

If u look at 2015 and 2016 HRC is generating more than EPS Rm 1.00 mah...!!

So if HRC can generate another EPS above rm 1.00 in 2017 certainly mkt will rerate mah....!!
It is unsustainable HRC PE maintain so low at 3x mah....!!

What is the fair rerate conservative value leh ??
Raider think at least PE 6x loh....!!

Thus if
2015 EPS Rm 1.00
2016 EPS Rm 1.00
2017 est EPS Rm 2.00
Avg EPS Rm 1.33

So if AVG EPS Rm 1.33 for 2017 ...rerate PE 6x....will mean HRC easily immediate target share price of Rm 8.00, this is coming 2nd qtr reporting loh...!!

So be prepare to expect HRC share price at around Rm 8.00 in aug after 2nd qtr reporting date loh...!!

Posted by pitbull > 2017-07-21 23:56 | Report Abuse

Hope got the part 2 articles

Posted by pitbull > 2017-07-22 00:00 | Report Abuse

If petronm can very smooth to hit RM12,
I think hrc also will ard RM10
Ppl Will chase same type company
"Refinery"

Posted by davidtslim > 2017-07-22 00:02 | Report Abuse

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.

Posted by stockraider > 2017-07-22 00:03 | Report Abuse

No need to depend on Petron....in fact HRC will take the lead in the month of August loh....!!

Its share price will move ahead 1st....in anticipation of good result coming loh....!!

Posted by pitbull > 2017-07-22 00:03 | Report Abuse

I think both stock hvnt got banker come and goreng..
Both of their total share quiet limit
All below 300mil
If up can shoot very fast

Posted by pitbull > 2017-07-22 00:05 | Report Abuse

I like the Conservative estimation..
Let me more comfortable

Posted by stockraider > 2017-07-22 00:07 | Report Abuse

David and probability estimate of HRC result too high loh...!1

Raider see even if HRC report EPS Rm 0.35 for 2nd qtr, HRC share price will fly, bcos the previous yr corresponding qtr eps is only Rm 0.15 loh...!!

If we set low hurdle of eps Rm 0.35 for 2nd, 3rd & 4th...HRC eps will exceed rm 2.00 loh...!!

Posted by probability > 2017-07-22 00:08 | Report Abuse

always amazed by raiders ability to take a step back..and look at the big picture..

unlike many of us who gets bogged down with silly nitty gritties..he he


Posted by stockraider > Jul 21, 2017 11:52 PM | Report Abuse

Raider says...people are too worried about refinery earnings loh...!!

U need to understand loh...HRC trading at PE 3x...why leh bcos sceptical about refinery profit sustainablility loh...!!

Also people worried about inventory losses too loh !!

Put it this way loh....!!
At PE 3x....HRC is generating 33% return pa loh...!!

If u look at 2015 and 2016 HRC is generating more than EPS Rm 1.00 mah...!!

So if HRC can generate another EPS above rm 1.00 in 2017 certainly mkt will rerate mah....!!
It is unsustainable HRC PE maintain so low at 3x mah....!!

What is the fair rerate conservative value leh ??
Raider think at least PE 6x loh....!!

Thus if
2015 EPS Rm 1.00
2016 EPS Rm 1.00
2017 est EPS Rm 2.00
Avg EPS Rm 1.33

So if AVG EPS Rm 1.33 for 2017 ...rerate PE 6x....will mean HRC easily immediate target share price of Rm 8.00, this is coming 2nd qtr reporting loh...!!

So be prepare to expect HRC share price at around Rm 8.00 in aug after 2nd qtr reporting date loh...!!

Posted by pitbull > 2017-07-22 00:12 | Report Abuse

ROE 40"
So attractive..haha

Posted by resilient911 > 2017-07-22 03:52 | Report Abuse

amanah raya is just a trustee, holder is ASB

Posted by stockraider > 2017-07-22 12:08 | Report Abuse

Looking carefully on share performance in its glory days;

yr share price range average pe
2005 8.50 to 12.30 6x
2006 9.55 to 11.20 12x
2007 9.50 to 11.60 5.5x
2008 7.95 to 11.80 loss
2009 8.05 to 11.30 10x
2010 10.40 to 10.98 30x
2011 9.11 to 11.20 loss
2012 8.38 to 10.38 loss
2013 6.38 to 8.99 loss
2014 4.60 to 7.00 loss
2015 4.40 to 6.00 3.5x
2016 2.10 t0 6.00 3x

What cause HRC earnings to collapse in 2011 to 2014 ??
It is due mainly to HRC capacity and few billion capex in 2011 during the refinery margin downturn loh....!!

In 2011 to 2014 refining gross margin collapse to usd rm 1.00 to 1.50 per barrel loh....!!

This make a disaster for HRC with huge depreciation after the refinery expansion in 2011 and low gross refinery margin a recipe for destruction mah....!!

HRC is on the road to recovery with refining margin of USD 6.00 bpd in 2015 and USD 5.50 bpd in 2016.

It is expected 2017 the refinery margin will be USD 7.00 to 9.50 bpd mah.....!!

With this type of good margin PE rerating can easily go 6x or more loh...!!

Raider sees the glory days of SHELL trade above Rm 10.00 will be restored in 2017.

Posted by Alex Foo > 2017-07-22 13:21 | Report Abuse

yes, more articles! huat ar~

Posted by Alex Foo > 2017-07-22 13:22 | Report Abuse

probability mana lu punya? must educate mr. market. PE 3 很难看~

Posted by Alex Foo > 2017-07-22 13:23 | Report Abuse

my trade with oil is simple. usd 40, buy, usd 120, sell lol.

Posted by probability > 2017-07-22 13:41 | Report Abuse

Alex...any teaching, whether investing, trading, treating patience or even religion (especially) one can never reveal the secrets 100% completely..share share a bit can la...

If not how the teacher, the preacher or even the doctor can cari makan in future?

some teachers are also as smart as u la...

Posted by pitbull > 2017-07-22 16:55 | Report Abuse

Probability where my tenderloin steak..Hahaha

Posted by stockraider > 2017-07-23 12:51 | Report Abuse

THE STRONG CASE FOR PETRON ARE AS FOLLOWS;

1. STRONG SHAREHOLDER SAN MINGUEL DESERVE HIGHER RATING
2. INTEGRATED WITH REFINERY AND RETAIL
3. STRONGER BALANCE SHEET
4. PAYS DIV

PETRON IS STILL VERY BIG UNDERVALUE WHEN COMPARE WITH PET DAG.
IT DESERVE BETTER PRICE TOO...!!

Posted by 360Capitalist > 2017-07-24 08:30 | Report Abuse

Malaysia : Oil Refinery Players :-
1)Melaka I Refinery (Petronas), 100,000 bbl/d (16,000 m3/d)
2)Melaka II Refinery (Petronas/Phillips 66), 170,000 bbl/d (27,000 m3/d)
3)Kertih Refinery (Petronas), 40,000 bbl/d (6,400 m3/d)
4)Hengyuan Port Dickson Refinery (Hengyuan), 156,000 bbl/d (24,800 m3/d)
5)Petron Port Dickson Refinery (Petron), 88,000 bbl/d (14,000 m3/d)
6)Kemaman Bitumen Refinery (TIPCO), 30,000 bbl/d (4,800 m3/d)

Remarks :
HENGyuan Vs PetronM
HengYuan's refinery capacity is twice the size of Petron Malaysia, hence with good crack spread we should see HengYuan's profit will be double of PetronM's earning potential.
It should be a better bet in terms of profitability for HengYuan against PetronM.
Theoritically, HengYuan's share price (300mil shares @ RM5.80) should be higher than PetronM (279Mil shares @ RM8.50).

It is about time for HengYuan to catch up again PetronM. I believe within 6-9 months, HengYuan's share price should be running ahead of PetronM.

Posted by paperplane2016 > 2017-07-26 01:13 | Report Abuse

Great work again, I read again

Posted by Vivoforever > 2017-07-30 01:03 | Report Abuse

"it will suffer some inventory stock loss as it should keep around 18-21 days of crude oil stock "

18-21 days duration? Anyone can help enlighten me? how long the inventory can be keep with a fix price? or the price fluctuated each day?