Posted by Mikecyc > 2022-09-05 11:17 |

Post removed.Why?

Posted by Sslee > 2022-09-05 11:18 | Report Abuse

Ular tolong beri tahu itu MikeJohnChewCyacing saya punya TP HRC itu berapa?

Posted by Mikecyc > 2022-09-05 11:18 |

Post removed.Why?

Posted by Mikecyc > 2022-09-05 11:20 |

Post removed.Why?

Posted by UlarSawa > 2022-09-05 11:20 | Report Abuse

You hate dragon is understandable but Ular is not dragon. Ular lepaking more is the habit lah. How to change lah. Haiyoh. Correct?

myongcc5

Dragon, I admit I hate yr style. No substance yet busybody. But can't help to admire yr energy. Hope u talk less but learn to make more $$__

8 minutes ago

Posted by Mikecyc > 2022-09-05 11:22 |

Post removed.Why?

Posted by UlarSawa > 2022-09-05 11:22 |

Post removed.Why?

Posted by Mikecyc > 2022-09-05 11:23 |

Post removed.Why?

Posted by UlarSawa > 2022-09-05 11:24 | Report Abuse

Negative crackspread doesnt mean lose money as the company ada hedge at higher price lah. Not sure then must learn from prof Oil Specialist leh. at least pun goggles sikit lah. Haiyoh. Correct?


qqq3333

Anyone...negative crack spread still want to buy...
But no professional will buy knowing what I know

2 minutes ago

Posted by probability > 2022-09-05 11:24 | Report Abuse

@Zhuge,

Gasoline should be the most abundantly available in the futures for hedging far into the future and diesel & jet fuel had been having strong crack even under covid environment (less concerned) unlike gasoline demand affected by lockdown.

Thats why we can see in 2020 and 2021, HY still can deliver good earnings.

Further we can see in Q1 22 results the hedging losses under COHR is very low (even positive, as the futures maturing in 24 months could be well below 12.7).

Posted by UlarSawa > 2022-09-05 11:25 |

Post removed.Why?

Posted by Mikecyc > 2022-09-05 11:25 |

Post removed.Why?

Posted by Mikecyc > 2022-09-05 11:27 |

Post removed.Why?

Posted by probability > 2022-09-05 11:28 | Report Abuse

@Zhuge,

prove on the effects of hedging when crack spread drop below hedging level for balance hedged contract is here

Posted by Sslee > Sep 3, 2022 6:17 PM | Report Abuse

If you look into HRC quarterly report.
On 31/12/19. NAPS is RM 6.7045.
Q1 end 31/03/20 EPS negative 41.37 cents but NAPS is now RM 7.4418

Posted by Sslee > Sep 3, 2022 6:32 PM | Report Abuse

You can check what is the mogas92 crack spread on 31/03/2020.
www.tradingview.com/symbols/NYMEX-D1N1%21/

Posted by Sharewire > 2022-09-05 11:28 | Report Abuse

Sharewire

Mostly people prefer driving dog style
Especially mm

qqq3333

No one drive car already?

Posted by Mikecyc > 2022-09-05 11:29 |

Post removed.Why?

Posted by Sslee > 2022-09-05 11:31 | Report Abuse

If i will to attend the next HRC AGM, I will prepare the following questions on refining margin swap contract.
Refer refining margin swap contracts.
Is contact notional amt is sum of contracts (volume in barrel X hedged refining margin)?
What is refining margin swap contracts assets and liabilities and how it is computed?

Posted by UlarSawa > 2022-09-05 11:33 | Report Abuse

Example 1 — Fixing Refiner Margins Through a Simple 1:1 Crack Spread
In January, a refiner reviews his crude oil acquisition strategy and his potential gasoline margins for the spring. He sees that gasoline prices are strong, and plans a two-month crude-to-gasoline spread strategy that will allow him to lock in his margins. Similarly, a professional trader can analyze the technical charts and decide to “sell” the crack spread as a directional play, if the trader takes a view that current crack spread levels are relatively high, and will probably decline in the future.

In January, the spread between April crude oil futures ($50.00 per barrel) and May RBOB gasoline futures ($1.60 per gallon or $67.20 per barrel) presents what the refiner believes to be a favorable 1:1 crack spread of $17.20 per barrel. Typically, refiners purchase crude oil for processing in a particular month, and sell the refined products one month later.

The refiner decides to “sell” the crack spread by selling RBOB gasoline futures, and buying crude oil futures, thereby locking in the $17.20 per barrel crack spread value. He executes this by selling May RBOB gasoline futures at $1.60 per gallon (or $67.20 per barrel), and buying April crude oil futures at $50.00 per barrel.

Two months later, in March, the refiner purchases the crude oil at $60.00 per barrel in the cash market for refining into products. At the same time, he also sells gasoline from his existing stock in the cash market for $1.75 per gallon, or $73.50 per barrel. His crack spread value in the cash market has declined since January, and is now $13.50 per barrel ($73.50 per barrel gasoline less $60.00 per barrel for crude oil).

Since the futures market reflects the cash market, April crude oil futures are also selling at $60.00 per barrel in March — $10 more than when he purchased them. May RBOB gasoline futures are also trading higher at $1.75 per gallon ($73.50 per barrel). To complete the crack spread transaction, the refiner buys back the crack spread by first repurchasing the gasoline futures he sold in January, and he also sells back the crude oil futures. The refiner locks in a $3.70 per barrel profit on this crack spread futures trade.

The refiner has successfully locked in a crack spread of $17.20 (the futures gain of $3.70 is added to the cash market cracking margin of $13.50). Had the refiner been un-hedged, his cracking margin would have been limited to the $13.50 gain he had in the cash market. Instead, combined with the futures gain, his final net cracking margin with the hedge is $17.20 — the favorable margin he originally sought in January.

In January, Refiner sells the 1:1 Gasoline Crack Spread Futures contract at $17.20:

Sells 1 May RBOB gasoline futures contract at $1.60 per gallon ($67.20 per barrel) Buys 1 April CL futures contract at $50.00 per barrel
Locks in the crack spread at $17.20 per barrel

In the Cash Market in March, Refiner sells the Gasoline Crack Spread at $13.50:

Sells 1000 barrels of physical gasoline at $1.75 per gallon ($73.50 per barrel) Buys 1000 barrels of physical crude oil at $60.00 per barrel
Receives a positive cracking margin of $13.50 per barrel

In March, Refiner buys back (liquidates) the 1:1 Gasoline Crack Spread Futures contract at $13.50 per barrel:

Buys 1 May RBOB gasoline futures contract at $1.75 per gallon ($73.50 per barrel) Sells 1 April CL futures contract at $60.00 per barrel
Futures gain of $3.70 per barrel (which can be applied to the cash market cracking margin)

Profit/Loss calculation:

Hedged crack spread = $17.20 per barrel
Un-hedged cash market cracking margin = $13.50

Posted by UlarSawa > 2022-09-05 11:33 | Report Abuse

Example 2 — Refiner with a Diversified Slate Hedging with the 3:2:1 Crack Spread
An independent refiner who is exposed to the risk of increasing crude oil costs and falling refined product prices runs the risk that his refining margin will be less than anticipated. He decides to lock-in the current favorable cracking margins, using the 3:2:1 crack spread strategy, which closely matches the cracking margin at the refinery.

On September 15, the refiner decides to “sell” the 3:2:1 crack spread by selling two RBOB gasoline futures and one ULSD futures, and buying three crude oil futures, thereby locking in the 3:2:1 crack spread of $18.60 per barrel. He executes this by selling two December RBOB gasoline futures at $1.60 per gallon ($67.20 per barrel) and one December ULSD futures at $1.70 per gallon ($71.40 per barrel), and buying three November crude oil futures at $50.00 per barrel.

One month later, on October 15, the refiner purchases the crude oil at $60.00 per barrel in the cash market for refining into products. At the same time, he also sells gasoline from his existing stock in the cash market for $1.70 per gallon ($71.40 per barrel) and diesel fuel for $1.80 per gallon ($75.60 per barrel). The 3:2:1 crack spread value in the cash market has declined since September, and is now $12.80 per barrel.

Since the futures market closely reflects the cash market, November crude oil futures are also selling at $60.00 per barrel — $10 more than when he purchased them. December RBOB gasoline futures are also trading higher at $1.70 per gallon ($71.40 per barrel) and December ULSD futures are trading at $1.80 per gallon ($75.60 per barrel). To liquidate the 3:2:1 crack spread transaction, the refiner buys back the crack spread by first repurchasing the two gasoline futures and one ULSD futures he sold in January, and he also sells back the three crude oil futures. The refiner locks in a $5.80 per barrel profit on this crack spread futures trade.

The refiner has successfully locked in a 3:2:1 crack spread of $18.60 (the futures gain of $5.80 is added to the cash market cracking margin of $12.80). Had the refiner been un-hedged, his cracking margin would have been limited to the $12.80 gain he had in the cash market. Instead, combined with the futures gain, his final 3:2:1 cracking margin with the hedge is $18.60 — the favorable margin he originally sought in January.

On September 15, Refiner sells the 3:2:1 Crack Spread Futures contract at $18.60:

Sells 2 Dec RBOB gasoline futures contracts at $1.60 per gallon ($67.20 per barrel) Sells 1 Dec ULSD futures contract at $1.70 per gallon ($71.40 per barrel)
Buys 3 Nov CL futures contracts at $50.00 per barrel Locks in the 3:2:1 crack spread at $18.60 per barrel

One Month Later, in the Cash Market on October 15, Refiner sells the 3:2:1 Crack Spread at $12.80:

Sells 2000 barrels of physical gasoline at $1.70 per gallon ($71.40 per barrel)
Sells 1000 barrels of physical diesel at $1.80 per gallon ($75.60 per barrel) Buys 3000 barrels of physical crude oil at $60.00 per barrel
Receives a positive 3:2:1 cracking margin of $12.80

On October 15, Refiner buys back (liquidates) the 3:2:1 Crack Spread Futures contract at $12.80 per barrel:

Buys 2 Dec RBOB gasoline futures contracts at $1.70 per gallon ($71.40 per barrel) Buys 1 Dec ULSD futures contract at $1.80 per gallon ($75.60 per barrel)
Sells 3 Nov CL futures contracts at $60.00 per barrel
Futures gain of $5.80 per barrel (which can be applied to the cash market cracking margin)

Profit/Loss calculation:

Hedged 3:2:1 crack spread = $18.60 per barrel
Un-hedged cash market cracking margin = $12.80

Posted by probability > 2022-09-05 11:33 | Report Abuse

If they had hedged large portion of Diesel / Jet fuel, the COHR would have easily shown huge loss like we saw at end of Q2 22', by end of Q1 22 itself.

Posted by probability > Sep 5, 2022 11:24 AM | Report Abuse X

@Zhuge,

Gasoline should be the most abundantly available in the futures for hedging far into the future and diesel & jet fuel had been having strong crack even under covid environment (less concerned) unlike gasoline demand affected by lockdown.

Thats why we can see in 2020 and 2021, HY still can deliver good earnings.

Further we can see in Q1 22 results the hedging losses under COHR is very low (even positive, as the futures maturing in 24 months could be well below 12.7).

Posted by UlarSawa > 2022-09-05 11:33 | Report Abuse

Example 3 — Purchasing a Crack Spread (or Refiner’s Reverse Crack Spread)
The “purchase” of a crack spread is the opposite of the crack spread hedge or “selling” the crack spread. It entails selling crude oil and buying refined products. Refiners are naturally long the crack spread as they continuously buy crude oil and sell refined products. At times, however, refiners do the opposite: they buy refined products and sell crude oil, and thus find “purchasing” a crack spread a useful strategy.

When refiners are forced to shut down for repairs or seasonal turnaround, they often have to enter the spot crude oil and refined products markets to honor existing purchase and supply contracts. Unable to produce enough refined products to meet supply obligations, the refiner must buy products at spot prices for resale to customers. Furthermore, lacking adequate storage space for incoming supplies of crude oil, the refiner must sell the excess crude oil in the spot market.

If the refiner’s supply and sales commitments are substantial and if it is forced to make an unplanned entry into the spot market, it is possible that prices might move against it. To protect itself from increasing refined products prices and decreasing crude oil prices, the refinery uses a short hedge against crude oil and a long hedge against refined products, which is the same as “purchasing” the crack spread.

The “reverse crack spread” is also a useful strategy for professional traders as a directional move if traders take a view that current crack spread levels are relatively low, and will probably rise in the future.

In this example, the refiner is planning for upcoming maintenance, and decides to “buy” the simple 1:1 crack spread in January by buying RBOB gasoline futures, and selling crude oil futures, thereby locking in the current $17.20 per barrel crack spread value. He executes this by buying May RBOB gasoline futures at $1.60 per gallon (or $67.20 per barrel), and selling April crude oil futures at $50.00 per barrel.

Two months later, in March, when the refiner begins the refinery maintenance, he sells the crude oil at a lower price of $40.00 per barrel in the cash market because of the refinery closure. At the same time, he also buys gasoline in the spot market for $1.70 per gallon, or $71.40 per barrel. The crack spread value in the cash market has increased since January, and is now $31.40 per barrel ($71.40 per barrel gasoline less $40.00 per barrel for crude oil).

Since the futures market reflects the cash market, April crude oil futures are also selling at $40.00 per barrel in March — $10.00 less than when he purchased them in January. May RBOB gasoline futures are trading higher at $1.70 per gallon ($71.40 per barrel). To complete the crack spread transaction, the refiner liquidates the crack spread by first selling the gasoline futures he bought in January, and he buys back the crude oil futures, at a current level of $31.40 per barrel. The refiner locks in a $14.20 per barrel profit on this crack spread futures trade ($31.40 per barrel less the $17.20 per barrel crack spread in January).

The refiner has successfully hedged for the rising crack spread (the futures gain of $14.20 is added to the cash market cracking margin of $17.20). Had the refiner been unhedged, his margin would have been limited to the $17.20 gain he had in the cash market. Instead, combined with the futures gain, his final net cracking margin with the hedge is $31.40.

In January, Refiner buys the 1:1 Gasoline Crack Spread Futures contract at $17.20:

Buys 1 May RBOB gasoline futures contract at $1.60 per gallon ($67.20 per barrel) Sells 1 April CL futures contract at $50.00 per barrel
Hedges the crack spread at $17.20 per barrel

In the Cash Market in March, Refiner buys the Gasoline Crack Spread at $31.40:

Buys 1000 barrels of physical gasoline at $1.70 per gallon ($71.40 per barrel) Sells 1000 Barrels of physical crude oil at $40.00 per barrel
The cracking margin has increased to $31.40 per barrel

In March, Refiner sells (liquidates) the 1:1 Gasoline Crack Spread Futures contract at $31.40 per barrel:

Sells 1 May RBOB gasoline futures contract at $1.70 per gallon ($71.40 per barrel) Buys 1 April CL futures contract at $40.00 per barrel
Futures gain of $14.20 per barrel (which is applied to the $17.20 crack spread from January)

Profit/Loss calculation:

Hedged crack spread = $31.40 per barrel
Un-hedged cash market cracking margin = $14.20

Posted by UlarSawa > 2022-09-05 11:35 | Report Abuse

Then answer is goreng ctr lah. Correct?

Posted by qqq3333 > 3 minutes ago | Report Abuse

Somebody please tell me about pecca...
....no facts and figures but share go up...

Posted by UlarSawa > 2022-09-05 11:37 | Report Abuse

Ular asking OKU question again. Which example is HY hedging now. Anyone can reply first. B4 proceed the rest. Haiyoh. Correct?

Posted by probability > 2022-09-05 11:38 | Report Abuse

sslee, my thoughts are each hedged barrels are marked to market based on futures prices corresponding to their respective maturity date, at the end of the reporting period.

we can assume the 'A' we had used here as 'reflective' of their composite effects

If you use only Mogas92 crack spread: USD 31.58
Equation:
V x A=226,945,000 or V=226,945,000/A
V x (31.58 – A) = 1,490,267,000/4.397

Posted by Sslee > Sep 5, 2022 11:31 AM | Report Abuse

If i will to attend the next HRC AGM, I will prepare the following questions on refining margin swap contract.
Refer refining margin swap contracts.
Is contact notional amt is sum of contracts (volume in barrel X hedged refining margin)?
What is refining margin swap contracts assets and liabilities and how it is computed?

Posted by ValueInvestor888 > 2022-09-05 11:38 | Report Abuse

@probability, do hengyuan secured big forward contract when crack spread at around USD 20-30?

If they do big hedging, the results should be very good in next 1 year...

Posted by UlarSawa > 2022-09-05 11:38 | Report Abuse

Now the whole forum discussing the hedging leh. So must get back to the basic first leh. Is hedging is good to HY or not. Haiyoh. Correct?

Posted by qqq3333 > 1 minute ago | Report Abuse

Aiyoyo ular, professional value companies at enterprise value not hedging profits la...if like that set up a virtual refinery and make money next 10 years la

Posted by probability > 2022-09-05 11:40 | Report Abuse

all depends on availability of counter party to get into the hedging deals

Posted by ValueInvestor888 > Sep 5, 2022 11:38 AM | Report Abuse

@probability, do hengyuan secured big forward contract when crack spread at around USD 20-30?

If they do big hedging, the results should be very good in next 1 year...

Posted by UlarSawa > 2022-09-05 11:41 | Report Abuse

X factor. You sound like saham is like Idol show kah. Haiyoh. Correct?

Posted by qqq3333 > 58 seconds ago | Report Abuse

Pecca got goreng premium....it's the X factor....

Posted by UlarSawa > 2022-09-05 11:43 | Report Abuse

Ya lor. You also dunno the answer leh. Calculate apa lah. Assumption juga leh. At the end even is correct the share price also not reflecting the correct figure also mah. Haiyoh. Correct?

Posted by probability > 27 seconds ago | Report Abuse

all depends on availability of counter party to get into the hedging deals

Posted by ValueInvestor888 > Sep 5, 2022 11:38 AM | Report Abuse

@probability, do hengyuan secured big forward contract when crack spread at around USD 20-30?

If they do big hedging, the results should be very good in next 1 year...

Posted by UlarSawa > 2022-09-05 11:45 | Report Abuse

So far HY VWap pun 4.84 and the price traded below it. not good also leh. Haiyoh. Correct?

Posted by Mikecyc > 2022-09-05 11:45 |

Post removed.Why?

Posted by ValueInvestor888 > 2022-09-05 11:46 | Report Abuse

Thanks probability. Yeah, only mgt will know and i believe they cannot get much contract from sky high crack spread, logically...

Posted by UlarSawa > 2022-09-05 11:47 |

Post removed.Why?

Posted by Mikecyc > 2022-09-05 11:47 |

Post removed.Why?

Posted by UlarSawa > 2022-09-05 11:49 |

Post removed.Why?

Posted by Mikecyc > 2022-09-05 11:49 |

Post removed.Why?

Posted by investopology > 2022-09-05 11:49 | Report Abuse

hengyuan need more buyer. now seem like sideway.

Posted by Mikecyc > 2022-09-05 11:52 |

Post removed.Why?

Posted by ValueInvestor888 > 2022-09-05 11:53 | Report Abuse

with more clarity after the results, i don't think it will go back to RM 4.
My target PE is 3 which is good enough...

Posted by UlarSawa > 2022-09-05 11:54 |

Post removed.Why?

Posted by UlarSawa > 2022-09-05 11:55 | Report Abuse

So you TP PE 3.0
3.0/1.73 x 4.84 = 8.39

Posted by ValueInvestor888 > 37 seconds ago | Report Abuse

with more clarity after the results, i don't think it will go back to RM 4.
My target PE is 3 which is good enough...

Posted by Jerichomy > 2022-09-05 11:58 |

Post removed.Why?

Posted by Mikecyc > 2022-09-05 11:58 |

Post removed.Why?

Posted by UlarSawa > 2022-09-05 11:58 |

Post removed.Why?

Posted by i3lurker > 2022-09-05 11:58 | Report Abuse

so the Securities Commussion and Police are here ?

the Johnny Walker guy said he made Reports to SC and Police
I saw his post yesterday

Posted by UlarSawa > 2022-09-05 12:00 |

Post removed.Why?

Posted by Sslee > 2022-09-05 12:00 | Report Abuse

qqq3 the figures in Q2 show below:

Q2 financial report:
For Q2 2022, the RM897.257M profits before tax already included the realised derivaties loss matured on April, May and June of RM 438,758,000.

For H1 2022, the RM 982,535,000 profit before tax already included the realised derivaties loss matured on Jan, Feb, March, April, May and June of RM 870,964,000.

Hence if HRC do not do the hedging the profit before tax should be RM 870,964,000 + RM 982,535,000. On volume of about 21 million barrel
Or profit before tax of about USD 20 per barrel

And from above figures I derived the facts as most likely HRC already hedged their refining margin for H2:

H1 2022, RM 982,535,000 profit before tax with volume of 21 million barrel.
Per barrel PBT is USD 982,535,000/(21,000,000 × 4.4) = USD 10.63 per barrel which I think is acheivabled for H2.
So H2 at least another PBT of RM 982,535,000

It is up to you to believe or not?

I know many disputed my facts with another figure in Q2 on marked to market (30/06/2022) unrealised derivatives losses of more than RM 1 billion. But the figures in H1 already show you despite the realised derivatives losses of RM 870,964,000 HRC still manage a PBT of RM 982,355,000 after included this realised derivative loss.

Posted by Sharewire > 2022-09-05 12:00 | Report Abuse

Not possible even till qtr3 result out only hengyuan would see the day of light!

UlarSawa

So you TP PE 3.0
3.0/1.73 x 4.84 = 8.39

Posted by ValueInvestor888 > 37 seconds ago | Report Abuse

with more clarity after the results, i don't think it will go back to RM 4.
My target PE is 3 which is good enough...

Posted by UlarSawa > 2022-09-05 12:01 | Report Abuse

Really so bad. Must be hoping HY pecah bumbung tak jadi punya pasal. Haiyoh. Correct?

Posted by i3lurker > 1 minute ago | Report Abuse

so the Securities Commussion and Police are here ?

the Johnny Walker guy said he made Reports to SC and Police
I saw his post yesterday

Posted by UlarSawa > 2022-09-05 12:02 | Report Abuse

Then you TP berapa PE. Haiyoh. Correct?


Sharewire

124 posts

Posted by Sharewire > 44 seconds ago | Report Abuse

Not possible even till qtr3 result out only hengyuan would see the day of light!

UlarSawa

So you TP PE 3.0
3.0/1.73 x 4.84 = 8.39

Posted by ValueInvestor888 > 37 seconds ago | Report Abuse

with more clarity after the results, i don't think it will go back to RM 4.
My target PE is 3 which is good enough...