Posted by calvintaneng > 2021-03-25 01:04 | Report Abuse

Fgv owns 40% of Msm

Since Msm share price jumped from low of 55 sen to over Rm1.70 the one the benefitted the most is Fgv

There should be a remeasurement gain of over Rm300 millions for Fgv in the price surge of MSM

Since Fgv is still not rerated up it offers a better proxy bargain to Msm

Posted by CharlesT > 2021-03-25 06:03 | Report Abuse

Export segment: both CGS-CIMB and Affin Hwang report that MSM has locked in 65% of its targeted export sales volume in the first half of 2021 (1H21) at a favorable price premium of USD140-145 per tonne.

Fm 2019's Annual Report (Page 8):

• 1,073,888 tonnes annual production output
• Wholesale sales volume of 448,347 tonnes
• Industry sales volume of 415,602 tonnes
• Export sales volume of 83,341 tonnes

Their export sales volume is less than 10% of their total production. The effect may not be so big

Posted by CharlesT > 2021-03-25 06:04 | Report Abuse

I dont think the good result in last Q can sustain for long

Posted by MattHann > 2021-03-25 10:30 | Report Abuse

@CharlesT, you have nailed one of the most important catalyst for MSM: Export. Contrary to what you have alluded, Export segment is likely the growth driver for MSM for FY21. 2019 numbers is a poor reference for FY21 volume precisely because this year they have penetrated new markets with new products.

Importantly, you highlighted 65% locked in volume. This is 220,000 tonnes already secured for FY21, a 150% increase from 2019. And we are only in first quarter of 2021. Hope that helps!

Posted by CharlesT > 2021-03-25 12:07 | Report Abuse

65% of its targeted export sales volume..

What is their targeted export sales?

Where did u get the figure of 220,000 metric tonnes oredi secured for 2021??

Posted by CharlesT > 2021-03-25 12:08 | Report Abuse

Anyway, do u think the management can always make the right bet on the hedging of their raw materials as per this year?

Posted by CharlesT > 2021-03-25 12:19 | Report Abuse

Summary of Facts for 1Q21:

Increased selling price for Industry and Export
Lower raw material cost from hedging positions for domestic
Lower refining cost from 35% reduction in gas price
Increased Selling Price - Low Raw Material Cost - Lower Refining Cost = Higher EBITDA

Barring any unforeseen circumstances, all 3 facts above points toward a strong 1Q21, which may surpass 4Q20 results and trigger a share price rally. In Part 2, I will share on the numbers deep dive and projections.

Yes, but the prices oredi increased fm RM0.60 to Rm1.70 now, almost 200%...

Can the above 3 positive factors be sustainable? For one more Q or two Q?

Posted by MattHann > 2021-03-25 14:41 | Report Abuse

@CharlesT For targeted export sales, you can refer to Affin Hwang's report. All figures I quote are publicly available info.

Whether or not the 3 factors can be sustainable, we shall wait for the 1Q report to make further judgement. For now, it is sufficient to say 1Q/2Q results will have a high chance of good results.