Posted by hng33 > 2020-10-07 11:27 | Report Abuse

If wan to wait for share to go back to IPO price RM 6.50, you may need to wait for another 2-3 year till completion of its mega project line petrochemcial plant in Indonesia which is 2 x higher capacity. The line mega project is main reason Lotte raise fund of RM 3.5 billion from previous IPO.

Posted by tiberian > 2020-10-07 11:32 | Report Abuse

So long to wait.

Posted by see2sea > 2020-10-07 11:34 | Report Abuse

Thanks for your enlightenment @hng33..what is your TP?

Posted by Nepo > 2020-10-07 11:39 | Report Abuse

Quote

"首先，在 美国的 Lake Charles, Louisiana 的两家 Polymer（包括 LDPE 啊，HDPE 等等）被台风 Laura 影响了生产，导致了全球供应需求被打乱了，那么简单的生意道理就是 – 当供应减少了，需求量相比起来就会更高（净需求），因此价格就会上升！"

==============================================================
It is not demand driven. It is supply disruption. Once they restore production, price will drop..

All in all, Lotte share price will not be stable during this period..

Posted by aliyusof > 2020-10-07 11:51 | Report Abuse

Lino, can please post cimb report? Tqvm

Posted by aliyusof > 2020-10-07 11:52 | Report Abuse

Luno

Posted by hng33 > 2020-10-07 12:00 | Report Abuse

Lotte Q result to be release these month is very important, it serve as real recovery in profit margin forward. The real test on impact ASP hike to profit margin, EPS > 10sen will serve as major catalyst for Lotte to breakout year high level RM 2.55

Posted by Choivo Capital > 2020-10-07 12:02 | Report Abuse

Nepo,

Plastic prices were up before hurricane.

But the real meat is low naphtha prices, not higher plastics prices.

Posted by hng33 > 2020-10-07 12:08 | Report Abuse

Crack spread between naphtha and resin is key determinant. Another Hurrican on track to hit US petro hub again

https://edition.cnn.com/2020/10/06/weather/hurricane-delta-tuesday/index.html

Posted by Sslee > 2020-10-07 13:03 | Report Abuse

Thank you i3lurker,
I am looking high and low to park my money in cash rich, dividend giving and profit making company what more LCTITAN next quarter earning will be very good like INSAS.

Posted by soros228 > 2020-10-07 13:09 | Report Abuse

Well said SSLEE. Follow u; park in.

Posted by speakup > 2020-10-07 13:14 | Report Abuse

Nestle? F&N? Dutch Lady?

Posted by Sslee > Oct 7, 2020 1:03 PM | Report Abuse

Thank you i3lurker,
I am looking high and low to park my money in cash rich, dividend giving and profit making company what more LCTITAN next quarter earning will be very good like INSAS.

Posted by hng33 > 2020-10-07 15:53 | Report Abuse

LCtitan is undervalue stock, 75% market price is back by net cash, PE valuation is unjustified too low for upcoming V-shape earning recovery

Posted by Sslee > 2020-10-07 16:27 | Report Abuse

Haha i3lurker since when you become Philip' supporter?

Posted by Choivo Capital > 2020-10-07 16:37 | Report Abuse

Sslee,

Depends on what you think the value of family mart is.

in 5 years, family mart will be worth more than QL current business.

Posted by jjoker > 2020-10-07 16:39 |

Post removed.Why?

Posted by Sslee > 2020-10-07 16:47 | Report Abuse

By the way i3lurker is right, I will annualized the next quarter earning of Pchem and Lctitan and apply PE 6 to get my target price.

Posted by soros228 > 2020-10-07 16:56 | Report Abuse

klci drop 20 pts

Posted by titan3322 > 2020-10-07 23:05 | Report Abuse

No need to argue too much 2.40 by next week and 2.60 by last week of October as sure as the sun rises from the East do not worry of what foreign funds going to do just look at what TP CIMB IB has on this stock you will know most of them are just BShit

Posted by cbkia4896 > 2020-10-07 23:27 | Report Abuse

naptha price started to increase, but if plummets, lctitan memang can fly till high high
https://markets.businessinsider.com/commodities/naphthapreis

Posted by hng33 > 2020-10-08 07:51 | Report Abuse

Lcitian Profit margin is derive from crack spread between feedstock price, naphtha and product price, polypropylene, polyethylene, butadiene.

Any crack spread above production cost is pure profit to Lcititan. In the previous result, lotte only manage to reap about 5-7% net profit margin. If the crack spread widen to 15%, lotte net profit will increase 200%

Posted by tehxuiling > 2020-10-08 07:59 | Report Abuse

What you need to know about the coronavirus right now

Posted by hng33 > 2020-10-08 09:57 | Report Abuse

1. Covid vaccine from China will soon ending its final clinical trial these month, and seek approval for wide administration. US vaccine may delay a month later after China. All in, vaccine will be available by end of these year and mass production next year onward

2. Vaccination need syringe

3. Every vaccination need single use disposable Syringe

4. Every person need 2 vaccination

5. Worldwide, at least few billion people need vaccination, especially, entire US, European population are mandatory for vaccination

6. Syringe is disposable and sterile. Manufactured from
polypropylene/polyethylene.

7. Lctitan 80% product is polypropylene/polyethylene

8. Lctitan feedstock, naphtha is at multiyear low level due to oversupply crude oil. Crude oil will unlikely rebound back to above USD 50 in near future due to travel restriction, limiting large portion of crude oil product, jet fuel, petrol usage in the world

Posted by titan3322 > 2020-10-08 10:09 | Report Abuse

The analyses from this forum here is much more meaningful than some from the IB !

Posted by soros228 > 2020-10-08 11:54 | Report Abuse

well said titan 3322. IB con us

Posted by wallstreetrookie > 2020-10-08 12:45 | Report Abuse

Now accumulation phase. If you bought weeks ago good. If you just bought keep collecting. Once earnings is out, it’s too late

Posted by wallstreetrookie > 2020-10-08 12:46 | Report Abuse

No need to stare at the ticker all day. Look at the price action already know it’s not goreng stocks. But still be cautiously optimistic

Posted by LiimInvest > 2020-10-08 14:01 | Report Abuse

Lotte headed for better H2 with higher PE prices - https://www.thestar.com.my/business/business-news/2020/10/08/lotte-headed-for-better-h2-with-higher-pe-prices (Share from StockHunter)

Posted by Bigbull99 > 2020-10-08 14:28 | Report Abuse

Ya dont have to look at the ticker all day, you want some excitement wait for 4th week, it will start to shoot in the 4th week. Good that this is not a goreng stock, everyday slowly rise, fall down also easily absorb balik. All good people! IB will only upgrade once they see the results, they won't make any prediction without seeing figures, but once they see the figures, no time for retailers to collect.

Posted by Esperian > 2020-10-08 14:52 | Report Abuse

Haha after QR to prove the results for the next few quarters all the way up to RM3, no more chance

Posted by Bigbull99 > 2020-10-08 15:12 | Report Abuse

If coming QR is as expected 200mil-300mil profit, I think RM3 consider very low as following QR will be 300-400mil. Funds will come in already if Q3 is good. RM3.50 if as expected, then RM4.50-RM5 by Q4

Posted by LiimInvest > 2020-10-08 16:55 | Report Abuse

For FY20, Lotte Chemical Titan should be seeing its worst year, according to KAF, and thereafter be on a gradual path to recovery starting 2021 with spreads stabilising at US$400-US$500 per tonne levels.

PETALING JAYA: The rising price of polyethylene (PE), which has recovered to US$900 per tonne from the weak levels observed during the second quarter, will lead to a stronger second half for Lotte Chemical Titan Holding Bhd.

According to KAF Research, the spread of PE-to-naphtha (the raw material used to produce its chemical products) has expanded close to US$600 per-tonne-level in September 2020, compared with US$480-US$520 per tonne back in the second quarter of 2020.

This came as the result of stronger PE prices because Hurricane Laura in the US has affected production in the US after damage to local infrastructure. Meanwhile, prices of naphtha – obtained by refining crude oil – are lower recently, falling along with Brent crude prices.

Although second half 2020 is expected to be stronger for Lotte Chemical Titan, KAF still envisages the upside of the spreads to be limited as “the expected incremental supply of PE in 2021 is likely to still outpace incremental demand on a global basis”.

Additionally, the affected US plants should restart operations by end of 2020, bringing petrochemical dynamics back to normal.

“Hence, our product spreads assumptions for both financial year 2020 (FY20) and FY21 remain very conservative at circa US$436 per tonne and US$443 per tonne, respectively, ” it said in a report.

The research firm foresees naphtha prices to gradually strengthen starting 2021.

For FY20, Lotte Chemical Titan should be seeing its worst year, according to KAF, and thereafter be on a gradual path to recovery starting 2021 with spreads stabilising at US$400-US$500 per tonne levels.

The petrochemical group posted a core profit of RM48.5mil in second quarter 2020 when the average PE-naphtha spread was at U$487 per tonne.

“In first half 2020, core loss was at RM91.7mil, hence, our base case assumption implies lower product spread in fourth quarter 2020 on the back of weaker product prices as US plants come online gradually, ” said KAF.

Meanwhile, Lotte Chemical Titan’s major Indonesian expansion plan has yet to start, with the date of investment undisclosed due to the currently weak market climate.

This, said KAF, should help allay investor concerns over the potential for the company being caught out by a prolonged petrochemical price dip due to the significant investment needed for that Indonesia project.

“We believe the company will not be paying a higher dividend in 2020, given challenging global conditions and instead reserve its cash pile (RM1.67 per share) for major project expansions in the future, ” it added.

The research firm has maintained a “buy” on the stock with a sum-of-part target price held at RM2.55.

Posted by Choivo Capital > 2020-10-08 19:29 | Report Abuse

Yeap consolidating period. Results still going to be more than 300m honestly.

Posted by Tkeng > 2020-10-08 21:40 | Report Abuse

IBs take the cautious route. That's the best signal to accumulate. LoL.

Posted by Bigbull99 > 2020-10-08 22:54 | Report Abuse

IBs cannot help it, they have a SOP to follow, need to be really showing earnings only they will start flooding in and buy. Let it consolidate for 2 weeks. =)

Posted by hng33 > 2020-10-09 10:19 | Report Abuse

Louisiana is home to many petrochemical plants and refineries, most of which are monitoring the storm before deciding whether or not to shut them down as a precaution.

Sasol, which has operations in Lake Charles, has activated its hurricane plan and all products loading was suspended at the close of business on Wednesday, according to a letter to customers.

Phillips 66 delayed complete restart of its Lake Charles, Louisiana, refinery because of the approaching storm.

CITGO is monitoring Hurricane Delta at its manufacturing complex in Lake Charles, Louisiana, according to a company.

Louisiana Pigment is planning on shutting its plant in Lake Charles today and releasing all non-essential personnel.

The following map shows the chemical plants in the area.

https://www.icis.com/explore/resources/news/2020/10/08/10561252/hurricane-delta-shifts-to-the-west-lake-charles-chem-plants-in-direct-path

Posted by Bigbull99 > 2020-10-09 11:10 | Report Abuse

Thank you hng33 for your valuable insights all the time.

Posted by hng33 > 2020-10-09 11:22 | Report Abuse

2017
1. Margin spread of polyethylene-to-naphtha = USD 696/mt
2. Operating margin 14.5%
3. EPS 53.6sen

2018
1. Margin spread of polyethylene-to-naphtha = USD 614/mt
2. Operating margin 8.2%
3. EPS 34.6 sen

2019
1. Margin spread of polyethylene-to-naphtha = USD 483/mt
2. Operating margin 3.1%
3. EPS 19.4sen

2020 for 1H2020
1. Margin spread of polyethylene-to-naphtha = USD 493/mt
2. Operating margin - negative (inventory write down + turnaround plant + MCO causing local demand slump 50% etc)

2020 for 2H2020
1. Margin spread of polyethylene-to-naphtha = USD 600/mt
2. Operating margin + positive

Posted by Choivo Capital > 2020-10-09 11:54 | Report Abuse

thanks hng33

Posted by hng33 > 2020-10-09 12:08 | Report Abuse

Choivo Capital

Do you know the NETT impact currency on LCtitan? I assume weak USD is better for Lctitan as feedstock, naphtha is from import, USD denominated + production cost is locally (RM denominated) + sale is mainly cater for local demand, polyethylene for plastic maker in Msia and butadiene for glove maker in Malaysia. Lcitian did also some export of its end product to Indonesia and China, natural hedge currency. What do you think, is it right ?

Posted by Choivo Capital > 2020-10-09 12:23 | Report Abuse

Sounds about right, but too hard to say, because the US plant is in USD, but that one should touching comprehensive income instead of P/L.

They do hedge currency, so we see lah.

Posted by Hawk Eye > 2020-10-09 12:35 | Report Abuse

price is too good still going down

Posted by hng33 > 2020-10-09 13:21 | Report Abuse

Thanks choivo

Posted by LearningInvestor > 2020-10-09 16:08 | Report Abuse

seeing how PChem is performing, lctitan looks like a real bargain and laggard

Posted by Bigbull99 > 2020-10-09 17:12 | Report Abuse

Ya I'm surprised too to see how laggard is lotte compared to Pchem. One thing for sure Pchem have a lot of support from big fund houses and EPF. I believe one fine day this month or next surely will be star of the day attracting a lot of attention, we just have to be patient and wait for that 200-300mil profit.

Posted by soros228 > 2020-10-09 18:41 | Report Abuse

Thank hng33 for update. The hurricane Delta extremely devastating; possible closure of petrochemical co.

Posted by Yusofff > 2020-10-09 18:48 | Report Abuse

https://jawplace.com/lotte-chemical-titan-a-turnaround-story/

Posted by wallstreetrookie > 2020-10-09 22:36 | Report Abuse

be patient. I already went all in (not exactly all in but 30% portfolio) liao. Yall scared of what. Choivo also here. soros228 also here. Chill. No one is paying attention to Pchemical stocks right now the focus is on political counters.

Posted by wallstreetrookie > 2020-10-09 22:36 | Report Abuse

Lctitan good low risk investment drop collect up hold

Posted by SkyWave > 2020-10-10 11:45 | Report Abuse

Agree with most of the analysis here, hold and wait for the excellent QR