Today is the AGM.
Hi Pua, if it is not to troublesome, do give us some update from the AGM. Thank you in advance.

Looks like Tguan is following Scientex footsteps by diversifying into property sector.

Hi Pua,
Hope you give us some update here after you attend the AGM. I'm not able to go because it is too far for me. Many thanks.

Buy and wait until Oct for the HRC mill to be operational. If the mill goes into operation as planned and any the announcement of HSR which not mistaken will be announce in Aug or Sept, will likely give steel counter a push. So, maybe come back 6 months later and see how this counter is doing.

Not sure what is fueling the rise of TNB. I only can think one of the reason is potential of tariff adjustment next year and high chances it will materialise. Because gomen has postponed once and doubt they will push it for another 2 years which will be very close to election year.

Hi Pua, Can you asked the director for an online AGM for next year onwards. Thanks.

RP 3 expiring end of this year. Wondering will the RP4 be approved. If approved, meaning tariff will increase and TNB revenue will increase but then many other things will increase as well.

Hi, Anyone going for the AGM?

In the QR report already say upcoming Quarter will be better. Scientex also cited the same for their packaging business in their QR report.

Brent at 91+ and It's Fri'yeah..... @^_^@

Most important is for the ESSB to get up to 100% utilisation for the new capacity. Follow with the completion of the HRC mill in Oct and successful commissioning and production of HRC. If all of this goes according to plan, I think ESSB is on the right path and alittle luck from better steel future pricing should help this counter. In the mean time, I will just sit back and relax and enjoy a cup of hot chocolate...... @^_^@ meow

Nice.... @^_^@

Yes. While ESSB performance is a little lacklustre, Hiaptek performance is consider good. In any case, the ESSB's performance is acceptable, and this provides some additional insight about their operation. Considering that ESSB's new capacity has only been in operation for about 2 months as it only began on October 23. Moreover, since then, it has only been running at 80% capacity. I hope it ramps up to 100% by January.
They also mentioned the high cost of raw materials, which I assume to be iron ore. Since January, the cost has decreased by roughly 25%. Of course, the price of Steel has decreased in tandem. So let's wait another 3 months to see how this affects the next QR.

Just wait for Friday. And we have the weekend to digest the result. revenue definitely increases, but as fot PAT, that is million dollar question...

Wow, it just went above SMA 200. Not a technical person, but I guess that is a good news? The QR is expected to be released by this Friday, 29th. Will this friday be a good Friday???.... @^_^@ meow....

It will if the hedge their raw material that suppose to use for 700mt to 2700mt.
I'm not an expert in this. Mayb you be more familiar. I just drawing parallel base on what i seen from Airasia previously where the hedge their oil and make big gain and big loss from the fluctuation of the oil price. If not mistaken, there was a impairment from Airasia previously when the hedging went the opposite way.

I'm not sure. I did email them but there is no response. It is actually unrealised forex translation loss. Hence possible for reversal. My only worried is the FX is related to their hedging to their commodity raw material.

need to see if there is any forex translation loss. If yes, really need to get the details on what kind of Forex translation loss.

There is a RM10m impairment on trade receivables in
4QFY23 came from the sales of resin to a local customer. While
TGUAN had collected part of the amount, the payment for the
balance would not be immediate and as such its auditors believed
it would only be prudent to make an impairment on the entire
outstanding amount.

Maybe because of the new King and the revival of big projects like HSR? He has been a supporter of this project, and I believe it is key for the revival of the forest city. So the stake is high.

tksw, u can call me phoebe oni. No need sifu because i'm not qualified.
I have been buying accumulating all this while at various price. Anyway, do follow your own investment strategy. Mine might not work for you and your style might not work for me. Despite it not matching at 0.355, it is not a bad thing. It went back to 0.37 - 0.375...

I will continue to accumulate as it drop because i see it as undervalued. Not sure when it will be revalued, and i buying it in batches.

I park at 0.355 since last friday. Didn't get any. It could be a good thing thou. Let see how it play out in this few weeks.

I mean management didn't mention anything on PP.

CEO did bought 2M shares at 0.39.
The company did says in the AGM that there is no plan for right issue. But good point on the Private placement.

Trader investor need to adhere to their strategy and hence if certain signal shows downtrend, they need to cutloss. While Fundamental investor will continue to monitor and add as long the fundamental did not change, it is opportunity to add more. So, let's wait and see how it turns out in the 2Q.

Every investor have their own way in investing. I guess because it broken the sma200 indicator which suppose to be a strong support. Once broken, it indicate sign of downtrend. That is why heavy selling. I not a technical person. Hence I will stick to accumulate at weakness and wait for upcoming QR.

Wow!!! Really drop my glasses. I accumulate at 80+ and sold at 1.60+. When it went to 1.80, I thought that was crazy. Never expect it to go beyond rm2 and now rm2.30.....congrats to those still holding it.

Huh? What Green Dragon and big lady??? oh Dear....i hope the big lady is not me....

I start to accumulate more.

Lol...so fast my prediction come right. @^_^@

55 cents? Hmm, I'm aiming a little bit higher than that....anyway, TP varies on each individual and timeframe. All is certain is ESSB is growing and should benefit HTVB. Completing the HRC mill is only phase 2. There is a phase 3 plan to grow to 5Mil MT but lets reap the fruits for phase 2 1st. Like cold eyes said, most important criteria is growth. No growth dun buy. @^_^@

Yes...accumulate slowly and I'm doing the same too. I now waiting for the upcoming Q report (For Nov -Jan). It should show the full capacity of 2.7mil MT since the new blast furnace was put into operation on 8th Oct'23. However, management did say that it will only go achieve full capacity in 1Q'24.

The red sea conflicts is an issue affecting many exporters and not Hiaptek alone. And it is not a show stopper because there is another route which take 9 to 14 days more to reach the destination. Usually seller is FOB port and buyer responsible for the shipping cost but I'm not sure in ESSB arrangement. The demand might reduce due to higher shipping charges because longer route but then Malaysia steel export to Turkey has added advantage. Under MTFTA, the Malaysian steel exports to Turkey should be fully tax-free starting August'23. That also explains the sudden rise in ESSB exports to Turkey for 0 a year ago to 46% currently. And again, if the drop of HTVB is really due to the conflicts, i deem this is short term because it affect other company and not to mention countries as well.

tksw, stop calling me sifu as I no sifu.
& Young man right. Dun beliv my words. Do read the annual report, quarterly report and analyst presentation deck.
The reason I can think off for the continuevpressure of the price might due to the Red sea conflict. With 40% production export To Turkey, it will affect the revenue if it is affected. However, I believe this is short term.

I'm not sure if he is a goreng king but they don't give much dividend because they require the money for ESSB. For last few Q, they been dragged down by ESSB losses but i guess things about to change. All Capex has been set in. ESSB will start giving out 30% of profit as dividend starting 2025 which is next year. This will improve HTVB cash flow and possibly of giving better dividend.

Dig further into HTVB and ESSB over the weekend. I really puzzled by the RM123.4 FX translation loss, despite they stated as unrealized loss in their Q1 analyst briefing. I can only come to a conclusion either
1. They have so much money in USD that the fluctuation of USD causes the loss.
2. Their hedging went wrong.
3. They accept Turkish Lira as payment for their exports to Turkey, and lira has plunged a lot in the last 6 months.
4. They have ordered a lot of raw material for the 2.7 million MT production, but they have not paid, and somehow the forex is against them now.

https://htgrp.com.my/wp-content/uploads/2023/12/Analyst-Presentation-1QFY24_31-October-2023.pdf

Anyway, with not much ESSB information, it is difficult to know the reason for the loss. However, in the same presentation deck, management reveals that ESSB produces 237.5 kMT and the revenue is RM 611.6 million, Meaning that ESSB is selling RM 2,575 per metric tonne. With a 12% gross profit margin, it is quite close to the RM 2200 production cost the CEO informed the AGM. Hence, with new BF, a further 10% saving is expected, and this gives about 22% GPM. Therefore, with the new capacity of 2.7 million MT and considering 20% GPM, the potential gross profit is RM 1.35 billion. Net profit after tax estimate around RM1 billion annually. Net profit to HTVB is RM273 million, and that is equivalent to RM0.15 just from ESSB alone? Is this too good to be true?

The CEO informed that with the HRC mill, the produce will be 70% domestic and 30% export. Hope this will help in reducing the FX translation effect.

The government has allocated more than RM 90 billion for infrastructure development for 5 yrs, and last year only RM 15 billion was spent, and there is RM 75 billion to spent, meaning RM 25 billion each year. Upcoming November will be Anwar's 2nd year as PM and he needs to boost the economy, and building infrastructure is the most effective way to generate GDP. I will definitely monitor the ESSB HRC mill closely, and I think HTVB is worth to watch.

Ohh pls....i no sifu.......

I did post some questions during the agm live session, but it were not read out, and neither was the response emailed to me. So I missed out on some important information. Luckily, the question that the shareholder asked gave a very good insight into the ESSB operation.

The meeting minutes are out.
https://htgrp.com.my/agm-egm/

Management mentioned that the current average production is RM 2200 and with the new blast furnace, it potentially save up to 10%.
If the 10% turn into profit, this will translate to annual profit of RM 540 million. That is equivalent to 8c to HTVB?

What caught my attention is that they have power plant. A combine capacity of 150MW. I think none of the steel manufacturer have their own power plant because they were hit hard during the electricity ICPT hike. Most of them are using Electric arc furnace except for alliance steel and Lion industries but lion industries BF is old technology. That the reason they try to get funding in 2021 to build a new BF.
https://theedgemalaysia.com/node/662006
https://www.nst.com.my/business/2020/12/649643/lion-industries-target-produce-25-million-tonnes-hrc-q2-next-year

If you refer to HTVB latest annual report, Page 15 on selling of electricity, removing the profit from revenue is the cost of generation, which is RM 25.54 million. Dividing that by the generated electricity, each KWH is RM0.22c. It is so much lower than TNB tariff and with their own generation, they are not required to pay for 17c ICPT and 1.6%KWTBB. That is a huge saving.

From Annual report - "EPR successfully sold a total of 115,113,804 kilowatt-hours (kWh) of electricity to the grid, resulting in revenue totaling RM28.31 million and recorded asegment profit of RM2.77 million."

Therefore their product is very competitive and like the Ceo mentioned, all their production is backed by order. The current sales is 30% local consumption and 70% export. With the HRC, it will be flipped where it will be 70% for local & 30% export. I guess this will help to address the forex translation loss.

Lastly, the below article mentioned that the Jianlong HRC production will be moved to Malaysia to better serve the Asean region.Not sure how accurate is this but if it is true, it will benefit ESSB and definitely benefit HTVB.
https://news.metal.com/newscontent/102434658/Another-Chinese-steel-mills-made-its-way-to-overseas-For-Chinese-companies-looking-to-invest-overseas-what-are-critical-factors-to-watch-for

As for how much ESSB can contribute to HTVB, i believed everyone will have a different figure and you can do the maths. ESSB has said that they has established a 30% dividend policy that will start by 2025 which is next year. This will improve HTVB's cash flow.

Lol....i'm also 99% right the dog will bark when the sun sets.

If can break 2.05, there might be an uptrend......

Woohooo!!....back to RM2.

I guess it is in oversold territory. With the ESSB increase in 3x capacity from 700mt to 2700mt, HTVB JV profit should increase. Maybe really need to see coming Q results.

I think the meeting minutes will be publish by end of this month. You can refer to the website. I also waiting for it to be released so that i can confirm what i hear is correct. The answer to the MSWG question is already there.

1. The Forex transalation loss is an accounting loss. It will materialise when they close the book. And this is only the 1Q. So they will be possible of writeback which it happened .
2. Lion Industries HRC production was stopped in 2021. You can read their AR and find out the reason.
3. HTVB has paid all their money up to phase 2 to ESSB using internal fund. There is no additional fund injection needed as off now. As for phase 3, which will be about 2 to 3 yrs from now, ESSB will take the loan or something. If you attend AGM, you will know.

Why does USD strengthen resulting loss for ESSB? Don't they get more RM? I'm drawing a parallel with Ewint. Ewint operates using pounds in UK and when pounds strengthen, they get more MYR and expedites their return of cash to shareholders

Lol......@^_^@

Woof!...woof!...WoOF! WooF!..........Say what??
It's a pity since I can see you're desperate for attention and affirmation while yet trying to hard hide it. I do hope you're a young man now but not a childish mind trapped in a 50-year-old body. The difference is that the former has an opportunity to grow out of it, whilst the latter is stuck with it forever.

Oooo......someone feel the burnt???
My pinky toe is laughing now...... @^_^@

Good luck in telling the dog....
I guess he is licking his wound now with him shorting this counter. Got his ass burned.....