Posted by shortinvestor77 > 2018-08-04 12:48 | Report Abuse

No dividend stock.

Posted by probability > 2018-08-04 12:53 | Report Abuse

PE = 1 liao.....

need to talk about dividend meh?

Posted by Ricky Yeo > 2018-08-04 12:56 | Report Abuse

Does understanding the technicalities difference between Lionind and other steel industry allow one to achieve superior return?

Posted by probability > 2018-08-04 12:58 | Report Abuse

Ricky, have you understood the difference first?

Posted by Ricky Yeo > 2018-08-04 13:00 | Report Abuse

I haven't, same as I never understand the superiority difference between HY and Petron, that's why it is a serious question to ask.

Posted by probability > 2018-08-04 13:07 | Report Abuse

Basically the reason for market to dump the steel stocks in Bursa due to local mega-infrastructure projects halt, is not applicable for Iron export stocks like what had been presented there.

Posted by calvintaneng > 2018-08-04 13:19 |

Post removed.Why?

Posted by shortinvestor77 > 2018-08-04 13:34 | Report Abuse

probability PE = 1 liao.....

need to talk about dividend meh?
04/08/2018 12:53

Get stuck? Wanted to let go by saying PE 1, bullshit! PE is now about 3.96 lah! If you get stuck but no dividend to receive, then have to cut loss loh.

Posted by shortinvestor77 > 2018-08-04 13:35 | Report Abuse

Probability you buy lah don't talk so much!

Posted by FutureEyes > 2018-08-04 13:35 | Report Abuse

Can India cross 1 mnt in DRI exports?

By 360 Editor - July 4, 2018

https://www.steel-360.com/stories/iron-ore/can-india-cross-1-mnt-in-dri-exports

n 2013 when India’s total Direct Reduced Iron (DRI) export stood at a meager 0.13 mnt it was almost
incomprehensible to think that the country would be able to target the 1 mnt mark in overseas sales of
DRI. However, over the last few years tides in steel trade have turned drastically with India
clocking total DRI exports of 0.55 mnt and poised to propel overseas sales further.

In the light of fresh Induction furnace capacity expansions in neighbouring Nations and a
considerable rise in ferrous scrap prices, exports of DRI also known as Sponge Iron from India has
witnessed phenomenal rise over the last year, rising by almost 85 % in 2017. If current market trends are to be brought into consideration, there is a strong possibility that supply of DRI from India may well hit the 1 mnt mark over the next couple of years.

According to data maintained with SteelMint, exports of the valuable steel making raw material has risen almost three fold since 2015 when it stood at merely 180,000 mt. In the subsequent year DRI exports went up to 300,000 and they further rose to 550,000 in 2017. One of the key propelling factors for rise in overseas sales was the Bangladesh government’s decision to impose hefty import duty on billets. This compelled Bangladesh’s steel producers to maximize capacity utilization of the operating induction furnaces and to further augment capacity. This created a spike in demand for both scrap as well as DRI to feed growing Induction Furnaces.

Specifically, in 2017, exports rose significantly in November and December recording figures of 85,000
and 80,000 tonnes of overseas sales respectively. The rise occurred in proportion with increase in global scrap prices and has since then remained more or less on the higher side. According to the current demand-supply dynamics there is a limited possibility of scrap prices declining in the next few years thus clearly indicating a strong market for DRI.

Global ferrous scrap deficit
With China maintaining its 40% duty on scrap export and strengthening efforts to consume domestically generated scrap through new EAF capacities the availability of Scrap in Asia has been constrained. To make matters worse, the recently imposed tariff on steel imports by the United States of America will
push US steel generation, thus leading to higher scrap consumption. This is expected to reduce scrap exports from the USA which has been one of key Global suppliers. These factors together may possibly create a significant deficit in demand and supply of scrap.

Posted by FutureEyes > 2018-08-04 13:37 | Report Abuse

23 Jul 2018

Analysis: Direct reduced iron margin outlook against pig iron healthy, says US miner Cleveland-Cliffs

https://www.spglobal.com/platts/en/market-insights/latest-news/metals/072318-analysis-direct-reduced-iron-margin-outlook-against-pig-iron-healthy-says-us-miner-cleveland-cliffs

London — US iron ore miner Cleveland-Cliffs, which is building an HBI plant in Ohio, said it sees a healthy margin between direct reduced iron (DRI) and pig iron, and a move to higher quality iron units for regional electric arc steel mills stoking demand.

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Register Now A wider price spread has developed between pig iron and steel products with indicative DRI cash costs, as natural gas-rich industrial areas such as the Middle East, the US and Russia fire gas to reduce iron ore pellets to form iron usable in EAF mills and at integrated works.
S&P Global Platts sees DRI costs based on a FOB Brazil reference, trending over the past three years at around $200-$250/mt, assuming $4/MMBtu gas prices and $20/mt cash costs. Over the same three-year period FOB prices of pig iron from the Black Sea have doubled to over $400/mt FOB.

Pig iron, for commonly traded basic grade, is higher purity in iron than HBI and typically commands a premium in spot sales. The fixed costs of DRI and HBI plants, and associated works are huge, and Cliffs is budgeting $700 million for Toledo, Ohio, where it hopes to supply mills in the Midwest and Great Lakes.

The flexibility of using metallics, along with reducing impurities from scrap, may convert into value-in-use benefits in steel range and margins, and feedstock procurement options.

Hot-briquetted iron, a more transportable version of DRI, can expect to be competitive as Cliffs' Toledo plant comes onstream in 2020, according to Cliffs CEO Lourenco Goncalves. Cliffs may beat the August 2020 startup and deliver HBI earlier, he said.

"With where pig iron and busheling prices are, both above $400 and with the benefit of cheap and easily available natural gas, our cash margin for HBI would be north of $150/ton," Goncalves told analysts on Friday.

The spread between DRI costs estimated by Platts and Black Sea pig iron has continued to widen into July, as iron ore prices and strong pig iron demand keep seaborne levels strong into the US and Mediterranean.

"With the market share of EAFs in the US now approaching 70% of overall steel-making production and with their further advancement into higher margin sophisticated steel grades our HBI will be essential," Goncalves said.

In Toledo, Cliffs said all infrastructural and foundation work for the HBI plant is being concluded as of this month and erection of the plant will start in the third quarter, with the main plant tower work starting onsite later this year.

Voestalpine already produces HBI in Corpus Christi, Texas, and exports the metallic to Mexico and Europe, as well as selling to US mini-mills. Nucor produces HBI in Trinidad, with the material used in the US.

Pricing for HBI may be linked to steel scrap and pig iron. DRI is less traded, as DRI produced on site is used by EAF plants on-site or within steel groups, such as Nucor.

Voestalpine and Nucor buy iron ore pellets for their plants, while Cliffs intends to allocate production of DR-grade pellets from its own mining and production, capitalizing on margins staying in the group.

"We are the only proven and capable producer of DR grade pellets in the US," Goncalves said. "Cliffs is the only one that has full control over feedstock, DR grade pellets and that's a decisive factor; the most important element in actually being able to produce a high-quality and cost-effective DRI, HBI."

Posted by FutureEyes > 2018-08-04 13:37 | Report Abuse

"With where pig iron and busheling prices are, both above $400 and with the benefit of cheap and easily available natural gas, our cash margin for HBI would be north of $150/ton," Goncalves told analysts on Friday.

Posted by FutureEyes > 2018-08-04 15:57 | Report Abuse

Subject covered in the above article:


PART 1: The simple Iron Making process and how the spike in Scrap Iron price against Iron Ore makes HBI producer the ultimate winner?

PART 2: The turnaround in Lion’s HBI plant in 2017 and what will happen in 2018 considering raw material-Iron ore price is declining and product HBI price sky-rocketing with Scrap Iron?

PART 3: Strong supporting facts for the possibility of above 60 cents EPS derivation in Part 2 , 2nd scenario.

3.1 Historical performance of HBI plant:

3.2 Case study on what happened in 2004 for such spectacular earnings:

3.3 HBI demand prospect 2018:

3.4 HBI profit margin prospect 2018

PART 4: What could other Steel making plants of Lionind offer on EPS going forward?

Including Megasteel acquisition.

PART 5: Concluding statement

Posted by sherlock > 2018-08-04 17:24 | Report Abuse

futureeye,

thank you for your kind sharing
but, the most worrisome part about the Megasteel acquisition is not sufficient or seriously dealt with.
what is the impact of the megasteel acquisition on the prospective earning of lionind you had described in detail in your article ? is it an act of bailing out of a debt ridden company ?

Posted by shortinvestor77 > 2018-08-04 17:28 | Report Abuse

Agree.

Posted by sherlock > 2018-08-04 17:31 | Report Abuse

integrity of the management team is one of the most important factor we take into consideration when we invest into a company . if the management is not honest doing their business , it is better to put your money in the bank than to put to put the money in the hands of those who promises you sky and heaven .

Posted by Ooi Teik Bee > 2018-08-04 17:36 | Report Abuse

Dear sherlock,
I agree with you. In actual fact, you are very good and sharp.

To be honest with you, earning and PER of Lionind is the best among 4 major steel stocks.
Most investors are not happy with the management of WC.

It takes time for WC to build his reputation.
Hope WC turns into a new leaf.
Thank you.
Ooi

Posted by FutureEyes > 2018-08-04 17:45 | Report Abuse

Considering the below information from Hng33, i dont see an issue with Megasteel "asset"" acquisition. I see at as a win/win strategy instead of a bailout (win/lose).


Megasteel assets worth net book value RM 1.83 billion, sell to Lionind for just RM 538m and payment is base on deffer basis, The Lion Industries group is expected to pay ONLY RM132.16mil within 14 days from the date of lodgement of the court order for the Megasteel debt settlement scheme and the remaining payment shall be paid on a deferred basis.


Posted by hng33 > Jul 5, 2018 05:24 PM | Report Abuse

Megasteel is own by lion crop (76%)and lion diversified (24%), both control listed shareholder already delisted due to insolvency.

Lionind is buying megasteel assets/plant at huge discount and payoff its plant electricity bill in order to restart operation.

Lionind is NOT buying megasteel company, therefore, will NOT assume Megastseel company liability. megasteel will become empty shelf company will no assets backing after sold off its plant to lionind at huge discount. Megasteel will received cash payment from lionind on deferred basis and allowing megasteel to gradually repay back at 'discount' to all its creditor lionind (megasteel owe lionind as much RM 700m debt) and lender bank back.

Posted by hng33 > Jul 5, 2018 01:53 PM | Report Abuse

The main reason for such good deal between megasteel-lionind is lionind is megasteel CREDITOR in which megasteel owe lionind total RM 699m debt, therefore lionind have Upperhand and firsthand deal to bargain hunt on megasteel asset and arrange how megasteel can repay back in such arrangement in favor of lionind

Megasteel assets worth net book value RM 1.83 billion, sell to Lionind for just RM 538m and payment is base on deffer basis, The Lion Industries group is expected to pay ONLY RM132.16mil within 14 days from the date of lodgement of the court order for the Megasteel debt settlement scheme and the remaining payment shall be paid on a deferred basis. this will allow lionind to expedite and restart steel plant to full operation first, generate profit, and use such profit to gradually fully settle payment to megatseel at much later time. This in turn allow megasteel to staggering payback previous long outstanding debt back to creditor lionind and lender bank.

This is a ring fence payment scheme arrangement to eventually allow megasteel to become just shelf company, only use it to received cash payment from lionind on deffer basis and later use such cash to staggering settle debt owe to lionind, allowing it to recover back previous impairment provision.


Management’s response to Minority Shareholder Watchdog Group’s letter dated 17 November 2017

Q: As reported on page 119 of the Annual Report 2017, the Group has trade receivables due from the following two major relatedparties, Megasteel and Lion DRI which have been fully impaired in the previous year. The amount due is approximately RM700 million in the book. How confident is the Board that the amount is recoverable?

What actions have been taken to recover the trade receivables


A: Megasteel is currently structuring a scheme of arrangement (“Scheme”) with its creditors to settle its outstanding debts. The outcome would only be known upon the implementation of the Scheme by Megasteel. The ability of Lion DRI to generate sufficient cash flows to repay its debts to the Group is highly dependent on the Scheme of Megasteel, the underlying market demand, price of direct reduced iron and availability of raw materials

http://www.lion.com.my/WebCorp/licb.nsf/dbcfaa4642ae5c084825822400275b...

Posted by sherlock > Aug 4, 2018 05:24 PM | Report Abuse

futureeye,

thank you for your kind sharing
but, the most worrisome part about the Megasteel acquisition is not sufficient or seriously dealt with.
what is the impact of the megasteel acquisition on the prospective earning of lionind you had described in detail in your article ? is it an act of bailing out of a debt ridden company ?

Posted by mneo > 2018-08-04 17:47 | Report Abuse

by the way...if integrity of the management team is in question....the earning and PER of LionInd might not be true also...

Posted by FutureEyes > 2018-08-04 17:49 | Report Abuse

The plant Lionind is about to acquire is EAF plant as described on article above. The steel produced will be rolled to produce HRC, Hot Rolled Coil.

Thats all there is to it.

As presented on the HRC margin chart on the article above, the current margin of HRC making is exceeding RM 800 per ton compared to just RM 200/ton one and half year ago for a prolonged period.

Posted by mneo > 2018-08-04 17:50 | Report Abuse

There are so many stocks in Bursa to choose from....especially at this depressed market...why risk to buy questionable LionInd...... wait for a while and the truth will surface itself...

Posted by probability > 2018-08-04 17:52 | Report Abuse

RM 800/ton for HRC??...Thats why all the China Steel companies are minting record profit!!

Posted by probability > 2018-08-04 17:56 | Report Abuse

There are so many PE 10 or PE 20 stock with bigger greater Elephants sitting in the middle the house...

why keep harping on this PE = 1 stock liao??...Lol!


Posted by mneo > Aug 4, 2018 05:50 PM | Report Abuse

There are so many stocks in Bursa to choose from....especially at this depressed market...why risk to buy questionable LionInd...... wait for a while and the truth will surface itself...

Posted by probability > 2018-08-04 18:00 | Report Abuse

China's Steelmakers Are Smashing Production Records
Bloomberg News

August 1, 2018, 2:09 AM GMT+4 Updated on August 1, 2018

https://www.bloomberg.com/news/articles/2018-07-31/china-fires-up-steel-plants-to-extremes-after-xi-supply-squeeze

China’s steelmakers are smashing production records by pushing:

"furnaces beyond their typical limits, offsetting nationwide closures"
....................................................................................

that may be even more swingeing than government estimates, according to Goldman Sachs Group Inc.

The world’s top producer has trumpeted sweeping reforms in the past two years that have shuttered aging and illegal plants, and shackled winter output in the dirtiest regions. At the same time, official data shows output at record highs. That’s partly because, with demand robust and margins high, mills have rewritten their steel-making recipes to push output beyond normal capacity, says Goldman’s Hong Kong-based analyst Trina Chen.

“For the same blast furnace, mills can deliver an extra 10 percent or more steel than before,” Chen said by email. Operators are using iron-rich ores to boost productivity, and raising the portion of steel scrap in their feed-stock to as much as 30 percent from about 10 percent historically.

“The trend is continuing this year but they are approaching their stretchable limit,” she said.
...................................................................................

China’s average daily output was a record in June, taking first-half volumes to a best-ever 451 million metric tons, more than half world production. The unprecedented run-rate has yet to trouble a prolonged period of profitability that,

most analysts attribute to steady demand growth,
.................................................................

on top of the reforms driven by President Xi Jinping as a pillar of his economic agenda.


Baoshan Iron & Steel Co., the listed unit of China’s biggest producer, climbed in Shanghai on Wednesday, and other mills advanced after the country’s leaders signaled a fresh focus on bolstering economic growth.

Reinforcement bar futures surged to their strongest level in five years.
........................................................................

Goldman said in July that Chinese steel stocks could rally:

"ANOTHER 60 PERCENT in the next year",

and that’s after profits already jumped 151 percent in the first half, according to the China Iron & Steel Association.

Posted by FutureEyes > 2018-08-04 19:59 | Report Abuse

If one goes through the Tables above showing the cost of production derivation, one would notice that electricity tariff hike has almost negligible (zero) implication on its DRI/HBI production costs.

The tariff hike news had been capitalized by many speculative traders recently to push down the stock price.

The electricity costs has a considerable effect on EAF Scrap Iron melting plants only, where the consumption can go up to 500 kwh/ton. Even then, this is very small in comparison to other factors.

Posted by Jon Choivo > 2018-08-05 03:26 | Report Abuse

False precision is too high.

You're expecting a plant restart to go on perfectly. That there is no advancement in technologies from other producers which will reduce their cost and competitiveness.

Lionind is cheap ish I guess. But trying to predict quarters with such precision is likely to induce over confidence.

The more important question is, if the quarter is bad, are you willing to hold and average down?

Posted by Jon Choivo > 2018-08-05 03:28 | Report Abuse

Probability,

If China start back steel furnaces, this is very bad news.

The reason why steel price is even high now is because they closed the furnaces killing supply.

Like I said, high price result in higher supply, resulting in lower price.

You so sure boh?

You wrong in predicting hy and master quarter still not enough is it. How much money you want to lose?

Go out in fd better for you I think.

Posted by value88 > 2018-08-05 09:17 | Report Abuse

Since AnnJoo also can use iron ore as raw material, it will also beneficial like LionInd to take advantage of lower iron ore price vs scrap iron price.

Posted by probability > 2018-08-05 09:55 | Report Abuse

value88, your IQ is 10 times higher than Jon whom i think is only good in writing English literature essays

Posted by SureWin1Woh > 2018-08-05 10:51 | Report Abuse

OTB, WC's reputation has not being good and well-liked by market for the longest time. What makes u think it will be different this time?
Having said that, this deal may be good for LionInd in the longterm.

Posted by hentara > 2018-08-05 11:42 | Report Abuse

Next Mycron.

Posted by soojinhou > 2018-08-05 13:56 | Report Abuse

May I point out a big error in the article? Iron making is the process of removing OXYGEN, not CARBON. Iron ore exists as oxide, ie rusts. To make steel, you need to remove the OXYGEN, typically with high calorific carbon such as coking coal. At high temperature, carbon combined with oxygen to produce CO2 thus Fe2o3 becomes Fe. Carbon is then added to Fe in minute quantity to create a steel alloy that is strong and tough.

Posted by FutureEyes > 2018-08-05 15:23 | Report Abuse

soojinhou, the article was meant to give a simple understanding of the process. There is no need for such detail understanding.

Reason i had mentioned carbon is because it is something more tangible for the readers.

What is important is the Inputs, i,e the raw material and energy in the form of Natural Gas and Electricity required by the Shaft Furnace process.

http://www.businessdictionary.com/definition/direct-reduced-iron-DRI.h...

Extract from above: "to burn off carbon and oxygen content"

Alternative iron source produced by heating an iron ore (generally having 65 to 70 percent iron) at a temperature high enough to burn off its carbon and oxygen content (a process called reduction) but below iron's melting point(1535°C or 2795°F). The output is sold as pellets or briquettes (called hot briquetted iron or HBI) and contains from 90 to 97 percent pure iron, the rest being mainly carbon with trace amounts of other impurities.

Posted by soojinhou > Aug 5, 2018 01:56 PM | Report Abuse

May I point out a big error in the article? Iron making is the process of removing OXYGEN, not CARBON. Iron ore exists as oxide, ie rusts. To make steel, you need to remove the OXYGEN, typically with high calorific carbon such as coking coal. At high temperature, carbon combined with oxygen to produce CO2 thus Fe2o3 becomes Fe. Carbon is then added to Fe in minute quantity to create a steel alloy that is strong and tough.

Posted by soojinhou > 2018-08-05 15:30 | Report Abuse

I have to applaud the research you have done. Don't worry about Jon Choivo or Ricky Yeo pouring cold water on your work, we are after big money and we want to position ourselves BEFORE market reacts. They are more conservative and prefer to buy and hold for long term and so they won't be interested in cyclicals. I appreciate you showing how you derived your estimation of the throughput of the Labuan plant, because that's a figure I can't get from probability's writeup. The supporting data you provided appears to support your profit derivation, and I look forward to the company's results to confirm your thesis.

Jon Choivo, yes, high price leads to higher supply. But do note that in the case of steel, the rise in steel price we see now is not extraordinary, but the NORMALISATION of profits. The severe depression a few years ago was abnormal supply caused by dumping. Don't forget also, the massive supply from China is due to the propping up of loss making steel plants, or zombies, which should have been closed a long time ago. China itself has allocated massive funds to assist ex-steel workers who lost their jobs as China undergoes reform and stop the practice of subsidizing ailing state owned enterprises.

Posted by probability > 2018-08-05 15:34 | Report Abuse

Aiya FutureEyes, even if Lionind sells at 0.10 at PE = 0.1, those who are not invested will focus on any irrelevant negative aspects they can find...

They will talk as if even if you sell these Lionind shares free, they still dont want.

Still want to talk about WC meh? Isnt all the while WC has been a major shareholder of Lionind and they were interested in lionind?

Laughable liao!

Any engineers should understand a plant technology is a technology that performs the same no matter where and who operates that.

I think these investors should admit their poor understanding of HRC steel making process and unnecessarily link past poor performance of Megasteel "management" with the "plant" Lionind is interested to acquire.

Posted by FutureEyes > 2018-08-05 15:36 | Report Abuse

soojinhou, thanks for the appreciation

Posted by soojinhou > 2018-08-05 16:00 | Report Abuse

FutureEyes, carbon or oxygen doesn't affect the financial numbers you present. Thanks for the computation. I've stopped adding lionind after the megasteel deal was announced. Hopefully the circular on the acquisition will shed more light on the financial implication of the acquisition.

Posted by Ricky Yeo > 2018-08-05 17:19 | Report Abuse

Why is it pouring cold water? If I write 99 pages of thesis that doesn't lead to what I predicted, then someone should point to me that my writeup is BS. I'm not saying what is being written here is nonsense, I'm just asking does the difference in manufacturing process will lead to higher profit in coming quarter? which if it does, would it surprise the market? which if yes then push up the price substantially and therefore allow one to gain superior return?

Posted by soojinhou > 2018-08-05 20:51 | Report Abuse

Ricky sorry if I've offended you coz I didn't thought you will be interested in cyclicals. You are after all one of the rational writers in i3. Having said that consider these facts:

1) China produces more steel than the rest of the world combined. The implication from that is that they are the price setters. Given the buoyant steel price in China, Malaysian domestic price can't fall too much before export becomes a viable option, notwithstanding the slowdown in domestic infrastructure and property sectors.

2) Manufacturing process plays a part in profitability in steel making. One of the reason why iron ore based process is more profitable is because the price of graphite electrode has gone up 10x due to China's push into EAF and the shutdown of polluting graphite mines in China. Iron ore based steel making doesn't require graphite electrode.

Do note that Malaysian domestic rebar price has softened in Q2, so, there's a risk Q2 may be weaker than Q1. But then, the annualised PE from Q1 is merely 2.2.

Posted by probability > 2018-08-05 21:00 | Report Abuse

https://www.steel-360.com/cover-story/graphite-electrode-crisis-to-deepen-in-2018

Posted by probability > 2018-08-05 21:09 | Report Abuse

Hot charging of DRI for lower cost and higher productivity Steel making

http://www.millennium-steel.com/wp-content/uploads/articles/pdf/2004/pp55-58%20MS04.pdf

- Reduces specific EAF electrical power requirement
by 120–140kWh/t
- Reduces EAF electrode consumption by
0.5–0.6kg/t
- Reduces refractory consumption
- Increases EAF productivity or allows EAF electrical
system to be downsized
- Promotes low-nitrogen steel for flat products like all
DRI-based melt shops

Posted by YLR33 > 2018-08-05 22:37 | Report Abuse

from the management record and the fluctuation of HRC margin shown in the chart (from several hundreds rmd within few months), the acquire of Mega more likely is ballot

Posted by Jon Choivo > 2018-08-05 23:29 | Report Abuse

Soujinhou,

There is no such things are normalisation of profits in cost based industries

Perfect competition result in perfect destruction of incremental capital over time once inflation is taken into account for the entire industry on average.

You may win if your have an inherent cost based advantage or you are selling specialised steel etc.

The only way to make money from cost based cyclical industries, is to buy when people are highly pessimistic and its trading at price to book valaution. And sell when people start valuing it using pe.

Old plants can be restarted if the demand is there. When Donald trump put steel tariff. Dead plants in the US were restarted.

Im just saying your thesis here is very very very dependent on the next quarter. If its bad, you can go Holland. Because I doubt you will be willing to hold or average down.

So it's in effect a gamble. You're calculation of the expected value better be correct.

At 0.8, it may very well be a decent bet. But given the current market, they are many more better companies selling at cheaper prices.

I just don't see why this article goes into so much detail for no reason.

Its like a gambler thinking he's an investor.

Nothing wrong with gambling btw. But if you're gambling but you think you're investing, your sizing is likely to be very wrong.

Posted by dusti > 2018-08-06 06:21 | Report Abuse

Hope a steel company will offer author a job as CEO.
For investment purposes, we need financial numbers, yes, financial numbers to crunch, if necessary. Technical mambo jumbo gets one no where................cheers and Good Luck!

Posted by BigDaddyCool > 2018-08-06 07:14 | Report Abuse

aiyah this Calvin is all around talking shit here and there...many people get burnt badly because of his chui kong lanpah song only.Dont follow this conman.He is a total freak and disaster.

Posted by Ricky Yeo > 2018-08-06 07:47 | Report Abuse

JH, no it's all good. : )

Posted by mneo > 2018-08-06 08:51 | Report Abuse

The steel company need writer to make up good story for the company? ha.ha.. ya..if that is the case... the writer is a good candidate....but I think there are better writers in the forum...good in essay writing to cheat investors.....

Posted by value88 > 2018-08-06 08:57 | Report Abuse

It is not easy to gather so much hard data and complete the good article above. We should appreciate the author as he is giving us for free.
I may have doubt on the financial forecast, and the coming earnings may deviate from what have forecasted above. But, the reasoning and the logic of why iron ore price decreases and scrap iron price increases, and why LionInd has good earnings prospect from its HBI operation is there. We can take away the useful facts after reading the article above. I personally have benefited from it.

Posted by probability > 2018-08-06 16:52 | Report Abuse

makhluk apa ni?..tulis pelik2 tak masuk akal...

Posted by Jon Choivo > Aug 5, 2018 11:29 PM | Report Abuse

Soujinhou,

There is no such things are normalisation of profits in cost based industries

Perfect competition result in perfect destruction of incremental capital over time once inflation is taken into account for the entire industry on average.

You may win if your have an inherent cost based advantage or you are selling specialised steel etc.

The only way to make money from cost based cyclical industries, is to buy when people are highly pessimistic and its trading at price to book valaution. And sell when people start valuing it using pe.

Old plants can be restarted if the demand is there. When Donald trump put steel tariff. Dead plants in the US were restarted.

Im just saying your thesis here is very very very dependent on the next quarter. If its bad, you can go Holland. Because I doubt you will be willing to hold or average down.

So it's in effect a gamble. You're calculation of the expected value better be correct.

At 0.8, it may very well be a decent bet. But given the current market, they are many more better companies selling at cheaper prices.

I just don't see why this article goes into so much detail for no reason.

Its like a gambler thinking he's an investor.

Nothing wrong with gambling btw. But if you're gambling but you think you're investing, your sizing is likely to be very wrong.

Posted by probability > 2018-08-06 16:54 | Report Abuse

value88, seriously if only we have more people who can comment like you, i3 would be truly an intelligent place to spend our time

Posted by value88 > Aug 6, 2018 08:57 AM | Report Abuse

It is not easy to gather so much hard data and complete the good article above. We should appreciate the author as he is giving us for free.
I may have doubt on the financial forecast, and the coming earnings may deviate from what have forecasted above. But, the reasoning and the logic of why iron ore price decreases and scrap iron price increases, and why LionInd has good earnings prospect from its HBI operation is there. We can take away the useful facts after reading the article above. I personally have benefited from it.