Posted by BornToSpeculate > 2020-08-01 17:56 | Report Abuse

Lets just look at it objectively. They reported pre-tax profit of RM109M for Q2 2020 in COVID environment which is approx 20% down from 2Q2019 of RM138M. How can this is be bad result when 70-80% of all the companies on BURSA are reporting worst declines or worst still, losses.

Instead of looking at the movement of the non cash items like reversal on impairment on stocks, etc, I instead I look at the cashflow from operations, which looks healthy at Q2 even at cumulative level ie from -Rm28m operating loss to operating profit cumulative of RM195M. Meaning this quarter alone is around RM223M which is around average per quarter if you look 2019 as baseline.

At this price, your paying 30 cents for the whole business since net cash per share is around 1.71 and this is actually a very good business to be in, just that its cyclical. Some might argue, but there are 2 players in Malaysia and they dont necessarily produce identical products like-for-like anyway and LCT performance also includes performance of offshore subsidiaries. If you view LCT being overvalued, please share with rest of us what is of better value instead of just making a general statement.

As an investor, we shouldnt be worried about what short term spikes. Remember approx 90% of retailers lose money whereas only 10% actually make consistently. If following the herd chasing shares up and down hasnt work, maybe you need a new strategy

Do we have earnings visibility for LCT ? Naptha spreads to selling prices are still very healthy so not only do i think Q3 will be superb but probably Q4. On the expansion, for Lotte Chem Korea to invest 16B into their Indonesia plant they must have done their due diligence and obviously the financing bank will look at the project viability before they do part of the financing. So to those that think this is a lousy business, i guess Lotte Korea is only willing to bet 16b on it. How much are you betting your future ?

Except for Glove, Tech and Food, which other sector can you say with confidence that there will be stable future earnings. Most other sectors everyone is holding is on a silly promise that recovery will come soon but as to when no one has even a clue.

Posted by BabyAce > 2020-08-01 18:57 | Report Abuse

@BornToSpeculate: We should have more people like you here haha

Posted by Patrick13 > 2020-08-01 19:18 | Report Abuse

Top up at 2.02.

Posted by James Ng > 2020-08-01 21:03 | Report Abuse

https://klse.i3investor.com/blogs/general/2020-08-01-story-h1511473034.jsp
[转贴] [Video:浅谈LOTTE CHEMICAL TITAN HOLDINGS BHD, LCTITAN, 5284] - James的股票投资James Share Investing

Posted by LiimInvest > 2020-08-01 21:12 | Report Abuse

Will accumulating more

Posted by soros228 > 2020-08-01 22:29 | Report Abuse

Hi BTS
1, some of reader mentioned about LCT and vaccine, can u help elaborate the link between the 2. Tq.
2. for Q2 result, most of us are confused, is it the real profit or it is just merely the reversal of inventories accumulated from the Q1, need your input.
Thanks.

Posted by BornToSpeculate > 2020-08-02 11:21 | Report Abuse

The only relationship between LCT and the vaccine is the premise that the cure could help to spur back global demand and consumption that would lead to a hope that oil prices can increase back to pre covid level of 65 USD .This would affect LCT as raw materials such as ethane and naptha which is a derivative of oil, would increase.

This is solely my view but looking at how most of the oil majors like Shell, Exxon and Mobil have reported bad financials this last week and took a huge beating on their share prices, I dont see oil prices jumping back so quickly and even if the cure is out today, it would take 3 -6 mths for businesses and demand to slowly adjust back to pre crisis levels. And then of course you have the unfortunate casualties of the pandemic where some businesses that close might not re-open anymore. That will obviously affect global consumption.

This is of course only part of the equation with the assumption that LCT is not able to increase cost of production to end users. To understand whether they can pass on costs to buyer you have to look at the demand for LCT polymer and monomer products which is actually very broad based. Its true, LCT products are used for masks, gloves, etc but the ultimate contribution by these sectors are not big because they do a lot of products, and they sell to a lot of different industries.

This is also a good thing to me that they are affected more by overall global demand / consumption rather than just 1 or 2 particular sectors. Then again, you have to look at supply of petrochemical plants and those are active. When some go offline for maintenance, like what LCT did in Mar / Apr 20, supply will be cut and prices can higher higher.

As for your second question, i actually answered it earlier with my explanation on operating cashflow improving from -28M in Q1 to RM195M in Q2 which is the real cash profit indicator. The reported profit is just accounting profit and you can say that in Q1 LCT decided to make a bigger than required write down on inventory, and now in Q2 they are writing some of it back. This is all non cash anyway so if you look at cashflows, they did reasonably well. I tried to explained that 1h2019 their cumulative operating cashflow was about RM490M which lets say we then use this as baseline as say its RM245M per quarter. For Q2 2020 cumulative, LCT generated RM223M ( from 195m + 28M ) so not far off

The financials can be a bit confusing coz in some places they use QoQ, some use Cumulative to and Cumulative half year

Posted by stockraider > 2020-08-02 11:31 |

Post removed.Why?

Posted by BornToSpeculate > 2020-08-02 11:40 | Report Abuse

And finally back to the part that concerns most of us here i.e. LCT share price. If you look at the volume on the last trading day afternoon session, was it due to negative politic news, a really bad QR or perhaps one particular fund that decided to exit ? If you look at LCT top 30 shareholders and understand the fact that Lotte Korea holds 70% and they are already under-fire for compliance of shareholders spread how it is possible that retailers could generate this kind of volume.

It also means that another fund had increase their stake as the market cannot absorb so much selling down otherwise. It was 5% shares total active shares traded on that day as if you take 2.308b shares x 30% ( as Lotte Korea will not be trading so i take only the remaining 30% of tradable shares ) u get about 692m shares. 40m shares were traded on last trading day.

Posted by BornToSpeculate > 2020-08-02 11:45 | Report Abuse

stockraider you welcome criticize me lor. but please give me more factual statements that just u dont like what i wrote.

Then i should ask u why Lotte Chem Korea today still can survive as top 30 worldwide or why isnt the world only left with top 5 players in every industry. Then we see who the sohai is lor

Why dont you tell us why Petronas can survive when there Exxon, Mobil and Shell.

Posted by stockraider > 2020-08-02 11:49 | Report Abuse

aiyah i just kacau u, n see how u response loh..!!

It is just a friendly kacau mah...!!


Posted by BornToSpeculate > Aug 2, 2020 11:45 AM | Report Abuse

stockraider you welcome criticize me lor. but please give me more factual statements that just u dont like what i wrote.

Then i should ask u why Lotte Chem Korea today still can survive as top 30 worldwide or why isnt the world only left with top 5 players in every industry. Then we see who the sohai is lor

Why dont you tell us why Petronas can survive when there Exxon, Mobil and Shell.

Posted by BornToSpeculate > 2020-08-02 11:56 | Report Abuse

stockraider haha ok. i thought i was stepping on your tail. Later kena kacau from you until koyak like rest in the other forums

Posted by stockraider > 2020-08-02 12:09 | Report Abuse

No like that lah....!!

Raider is net net positive most of the time mah....!!

Your lctitan net cash Rm 1.70...i pay another 30 sen....already got a steady business that worth at least Rm 5.50 and ipo Rm 6.50...veli worth it n song mah...!!

Don forget is dividend can dapat at least 6sen to 15sen mah..!!

Why people don like ?? Just plain stupid mah...!!

Posted by BornToSpeculate > Aug 2, 2020 11:56 AM | Report Abuse

stockraider haha ok. i thought i was stepping on your tail. Later kena kacau from you until koyak like rest in the other forums

Posted by soros228 > 2020-08-02 18:31 | Report Abuse

Thanks BTS. WE are fortunate to have u here. To make constructive decision. Thanks bro

Posted by GoBig21 > 2020-08-02 18:34 | Report Abuse

I still hold this stock.. Mostly because of BTS and Titan3322. Cheers.

Posted by JaBerry > 2020-08-03 09:49 | Report Abuse

Yes. I still hold you

Posted by Ismail5595 > 2020-08-03 10:36 | Report Abuse

*Results Update*
*Lotte Chemical Titan Holding Berhad (5284)*
*Target Price: RM1.64 (Sell)*
Lotte Chemical Titan Holding Bhd’s (TTNP) 1H20 core net loss of RM129mn (1H19: RM82mn profit) exceeded our expectations, but was below consensus’ forecasts. Results were above our previous full-year loss estimate of RM47mn. However, TTNP’s performance underperformed consensus’ full year profit forecast of RM151mn. The variance versus our forecast was due to higher than expected volumes and reversal of write-down of inventories of RM102mn (1Q20: RM81mn). QoQ turnaround was mainly driven by: (1) recovery in volumes (+28%) and plant utilization (PU), (2) reversal of inventories write-down, and (3) improved spreads due to the plunge in naphtha feedstock prices (-23%). 1H20 losses was attributed to: (1) lower ASP, (2) decreased sales volumes, (3) associate losses almost doubled due to weakness at LC USA, and (4) plant start-up costs recognized in 2Q20 following completion of turnaround (TA) exercises. We raised FY20 sales volumes by 10% and reduced inventory costs by circa 25% to reflect actual 2Q20 results. As a result, our FY20 earnings forecast increased to RM10mn (previous: RM47mn loss). Our target price on TTNP is based on unchanged 2.5x CY21 EV/EBITDA. Maintain Sell.

https://taresearch.taonline.com.my/rrs/files/2020/8/LCTITAN_RU_20200803.pdf

Posted by stainlyho37 > 2020-08-03 11:44 | Report Abuse

u will see the rebound after lunch...just hold..1.90 just a block for collection !!!

Posted by whitebunny > 2020-08-03 11:46 | Report Abuse

@stainlyho37, why do you say so?

Posted by raymondlct126 > 2020-08-03 11:49 | Report Abuse

This rubbish counter takes all of us towards trash bin.

Posted by laychee > 2020-08-03 11:58 | Report Abuse

The revenue is worrying fundamental investors.

Posted by stainlyho37 > 2020-08-03 12:02 | Report Abuse

QR jun20..i can say not bad..esp. on MCO time...in term of company financial status,business model,dividen etc ...they are not many companies in bursa like can be hold medium term....

Posted by Needmoney > 2020-08-03 12:25 | Report Abuse

Diarrhea

Posted by BabyAce > 2020-08-03 12:32 | Report Abuse

Titan what happen to you? Tunepro and Ah Pek fly already you still like small kid tantrum...

Posted by J.EL > 2020-08-03 15:27 | Report Abuse

internal bleeding.. vomit blood..

Posted by BabyAce > 2020-08-03 15:31 | Report Abuse

Lucky not holding much for this..almost a bit more to my cut loss point. Sometimes do already homework also useless. Well shit happens sometimes and just need to be down to earth.

Posted by BornToSpeculate > 2020-08-03 16:46 | Report Abuse

We cannot avoid short term fluctuations it happens. If your holding on non borrowed money, it will go back up just be patient.

Judging by the volume, the seller hasn't finished selling and after that hopefully it will recover quick after.

There is nothing wrong with the fundamentals of this company

Posted by xterrorsinx > 2020-08-03 16:51 | Report Abuse

Waiting on the sideline, ready to jump in when there is buying sign. Good for long term

Posted by raymondlct126 > 2020-08-03 17:13 | Report Abuse

If next quarter is recovered, we may be have to face fx losses risk, if any. So, I won't see any prospect at this counter. I drunk (because of drinking beers) when I writing this comment. Hahaha....

Posted by Fabien "The Efficient Capital Allocater" > 2020-08-03 17:18 | Report Abuse

This is sooner than expected.

Have traded TITAN twice, both on the basis of its balance sheet value.

Looking to enter for the 3rd time.

Stock: [LCTITAN]: LOTTE CHEMICAL TITAN HOLDINGS BHD

Jul 17, 2020 9:17 AM | Report Abuse

If it drops back below 2, i will buy back again

Posted by Valgrovest > 2020-08-03 17:29 | Report Abuse

I re-entered a bit at 1.86 just before the closing. IMO price probably bottomed out after two days of correction. See how it is going to perform tomorrow before deciding to buy more.

Posted by soros228 > 2020-08-03 17:58 | Report Abuse

Ok BTS. cont to hold.

Posted by BornToSpeculate > 2020-08-03 18:13 | Report Abuse

If market crash tomorrow, you have the comfort that there is limited downside for this counter. I've been thinking to switch some to other counters but apart from gloves and tech, most of it is gambling on the virus recovery and we don't even know if they will continue to make a profit next 2 quarters

Posted by BornToSpeculate > 2020-08-03 18:15 | Report Abuse

I was initially planning to sell some after this quarter and switch some to pchem for another one month until the result then switch back. But look at pchem. It came down a lot too

Posted by J.EL > 2020-08-03 18:17 | Report Abuse

Tomorrow drop again I'll topup. I be BTS army.. T.T

Posted by BornToSpeculate > 2020-08-03 18:21 | Report Abuse

What I think is after the fund is done selling it will rebound. Already 60m shares past 2 days. Just be patient

Posted by greenberg > 2020-08-03 19:20 | Report Abuse

Tomorrow going rising, LCtitan like start point rising 185....

Posted by chaisoonkon > 2020-08-03 19:28 | Report Abuse

no need to worry .tp 2.50 .

Posted by BabyAce > 2020-08-03 19:32 | Report Abuse

I cut loss already. Sometimes need to admit I'm wrong. Although not much holding, but wrong is wrong and need to cut loss. Haiz, just grateful those of the heavily holding make me most of my profits.

Posted by 000698 > 2020-08-03 20:00 | Report Abuse

BabyAce I cut loss already. Sometimes need to admit I'm wrong. Although not much holding, but wrong is wrong and need to cut loss. Haiz, just grateful those of the heavily holding make me most of my profits.
03/08/2020 7:32 PM


I did read your report and still hold this stock. I want to cut cost but I buy the price was RM 2.30.

I'm planning to hold until next quarter.

Posted by BabyAce > 2020-08-03 20:22 | Report Abuse

@000698: Actually nothing wrong with the stock, just that all money in the money only flow to specific stocks. That's the reason I have to admit it and cut loss. Can't be helped.

Posted by ZoomUp > 2020-08-03 21:20 | Report Abuse

Lctitan should distribute the treasury shares of 34M so that it can increase the shareholding spread

Posted by ZoomUp > 2020-08-03 21:22 | Report Abuse

Tomorrow it will recover back to 2.00

Posted by Tkeng > 2020-08-03 23:24 | Report Abuse

Was lucky I guess... Sold 2.25 and initially regretted. Bought 1.95 and sold 2.03 on Friday. Still holding foc shares... Bought some 1.90. Will wait for now. If touch.. 1.70, sailang. Koreans haaaish!

Posted by kuanyap > 2020-08-04 00:09 | Report Abuse

lets wait party in rm1.80 and sailang !!!

Posted by Nepo > 2020-08-04 08:12 | Report Abuse

@Tkeng & kuanyap, thank you so much to support Lct share price,,hoping to have more Lct's sailang fans...at RM 1.70-1.80..

support..support..

Posted by Nepo > 2020-08-04 08:25 | Report Abuse

Definitely can buy at around RM 1.70 -1.80

Posted by songjoseph > 2020-08-04 08:44 | Report Abuse

good try .
my friend , nothing is definitely in stock market.

worse than our gomen situation, can change overnight

Posted by Nepo > 2020-08-04 09:13 | Report Abuse

Dont worry too much, buying stock is to buy its future..i.e luck is important..

if sth is quite safe as in Lct cash per value is RM 1.60, as long as co not making losses for a foreseeable future.. then buying at RM 1.70-1.80 is considered very good already..of course you need to take risk..but less risky than others..

Posted by raymondlct126 > 2020-08-04 09:21 | Report Abuse

Finally, this counter is stop bleeding.