Posted by Alex Lim Jun Xiong > 2017-03-12 22:55 | Report Abuse

Lee Chong Wei won already, so tomorrow Petron up?

Posted by probability > 2017-03-13 00:23 | Report Abuse

http://klse.i3investor.com/blogs/sumato88/118086.jsp

Posted by probability > Mar 12, 2017 11:26 PM | Report Abuse X

Hi sumato88, i have a different way/concept for valuation by sum of parts. My valuation is as per below based on your same discount factor 50% due to economy of scale:

Basis 1) Petron is running at its rated capacity - its not 53% as you had mentioned. I can verify on this if required. The same applies to Shell for my valuation purpose ( i have not verified for Shell).

Basis 2) I value the Asset by the running Capacity of the Refinery (for Refinery) and the Number of Gas stations owned (for Retail). And thus i give a 50% discount on Petron's valuation relative to Shell and Petdag on its Refinery and Retail segments respectively. I ignore EBITDA as eventually they should be the same for per unit basis of running capacity or the number of stations in operation.


A) Petron's Refinery Value by same valuation of Shell's refinery:

= (EV of Shell / Capacity of Shell) x (Capacity of Petron)
= (2123 / 156 ) x (88)
= 1,193M


B) Petron's Retails Value by same valuation of Petdag's retails:

= (EV of Petdag / Number of Petdag Stations) x (No. Petron stations)
= (21828/1000 ) x (320)
= 6,984M


Apply an EV discounted by 50% on the above (A) & (B) , you get:

= 50% x 1,193 M + 50% x 6,984
= 4,091M

Thus, the current EV is 1,710M compared to its 50% discounted valuation of 4,091.

This approximately gives = 140% upside instead of what you had reported as 56%.

Posted by ysh8793ysh > 2017-03-13 00:37 | Report Abuse

Wow ! That is so good.Keep it up, man.

Posted by probability > 2017-03-13 01:27 | Report Abuse

Refer 2nd qtr ending June 2016, note 12:

The 6 months throughput is 16.1 million barrels.

Use an average of 30 days x 6 months = 180 days to figure out the daily throughput.

16.1million/180 days = ~ 88k bpd

Posted by suregain > 2017-03-13 09:31 | Report Abuse

strong... beter than shell

Posted by Lee Yih Yeong > 2017-03-13 09:53 | Report Abuse

sell before too late....

Posted by damiantreez > 2017-03-13 09:54 | Report Abuse

dividend not announced yet. buy now before it rebounds

Posted by suregain > 2017-03-13 10:50 | Report Abuse

rebound soon... selling almost dries up

Posted by Chanzeryl > 2017-03-13 10:52 | Report Abuse

should be stable around 5.00 after few weeks, together with the price of crude oil

Posted by suregain > 2017-03-13 14:09 | Report Abuse

oil px down again :(

Posted by suregain > 2017-03-13 14:13 | Report Abuse

i saw the selling q oso suda takut...

Posted by shidayea > 2017-03-13 14:32 | Report Abuse

I bought last friday.. tdy pick up..

Posted by yesyesyes > 2017-03-13 16:32 | Report Abuse

oil rebound ?

Posted by suregain > 2017-03-13 16:58 | Report Abuse

tomorow confirm rebound...

Posted by Lee Yih Yeong > 2017-03-13 17:40 | Report Abuse

seelllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllll before too late

Posted by tradeview > 2017-03-13 17:42 | Report Abuse

On the contrary. I am starting to like the price point.

Posted by suregain > 2017-03-13 19:47 | Report Abuse

Tradeview, u mean now the price is atractive to buy?

Posted by princehero > 2017-03-13 20:02 | Report Abuse

wow.. can petron rebound?
oredi drop for a number of days....

Posted by suregain > 2017-03-14 09:37 | Report Abuse

rebound back to 6.20

Posted by Jay > 2017-03-14 09:51 | Report Abuse

if you observe the buying volume during the period after results, there were serious volumes first at 5.70 then next day around 6.10, so big money were at those two levels. these few days the volumes were considered very low compared to those up days. personally I think that's the price level those investors/operators/speculators are building on, just waiting for another catalyst to push up

Posted by Cindy Ling > 2017-03-14 10:03 | Report Abuse

so high temptation to buy... but just scare later again profit taking.... from green to red.... scary

Posted by 逍遥子 > 2017-03-14 10:11 | Report Abuse

If u buy because of the share price movements then my advice is don't buy, cause this counter short term share price can be very unpredictable. If u are eyeing for it value then yes it can be considered.

Good luck

Posted by Jay > 2017-03-14 10:12 | Report Abuse

it's not worth trading on this stock, you can't really make money with a few cents movement. if you are investing, then you just need to be aware of the potential returns and the risks involved. it's impossible to always time the market correctly and collect at its bottom

Posted by Lee Yih Yeong > 2017-03-14 10:38 | Report Abuse

昨夜我有一梦，梦见老猴爬树从。
潮州歌

Posted by suregain > 2017-03-14 12:27 | Report Abuse

no power

Posted by George888 > 2017-03-14 12:44 | Report Abuse

The whole company is selling for rm1.57 billion (market cap), and its net profit before tax is rm323 mil, that's 20% return on market cap, with PE of 6.6 only (profit after tax). Reminds me of PetroChina, when Buffett bought the company's shares :)

Posted by cheoky > 2017-03-14 14:25 | Report Abuse

anchoring bias in the making

Posted by suregain > 2017-03-14 22:34 | Report Abuse

Crude oil down like mh17....

Posted by 逍遥子 > 2017-03-14 22:42 | Report Abuse

Petron Corp posted an excellent results for FY2016, in the reports it mentioned that Petron Malaysia obtained an encouraging growth.

http://thestandard.com.ph/mobile/article/231775

Posted by Jay > 2017-03-15 08:32 | Report Abuse

crude oil bounced back on API data. this is the precursor to today's weekly EIA data, occasionally there could be discrepancies between the two but mostly similar trend

Posted by paperplane2016 > 2017-03-15 08:43 | Report Abuse

I have trust in Jay. I bought some PetronM and CB as well. Hope that its a wild car for this 2 years

Posted by Jay > 2017-03-15 09:06 | Report Abuse

i feel some pressure now. petron CB buy at own risk ya cause it's really a high risk high return trade. fundamentals are there but you can never know the short term mood swing of prices

Posted by zoizai > 2017-03-15 09:42 | Report Abuse

So many weak holder

Posted by suregain > 2017-03-15 09:42 | Report Abuse

selling pressure coming back... never ends

Posted by Lee Yih Yeong > 2017-03-15 09:44 | Report Abuse

Thx jay for the advice. I will enter more

Posted by Cindy Ling > 2017-03-15 10:27 | Report Abuse

....

Posted by Jay > 2017-03-15 11:00 | Report Abuse

seems like market still reeling over yesterday night's drop in oil price. brent futures is rallying now but not much interest in O&G stocks

Posted by invest_101 > 2017-03-15 11:39 | Report Abuse

Hi sumato88 + probability,
thanks for your contribution and irrespective of the approach used, what is clear from your 'rationalisation' point of view, is that this stock appears deep in the value. Execution is key risk in my opinion and the management appears capable in handling this business, if not better than its peers. When visibility emerges, I am sure we will see gung-ho reports from Investment Banks and analysts, at much higher prices by then hopefully. Opportunity cost is not too bad either at approx 3.7% yield.

Posted by kelingman > 2017-03-15 13:48 | Report Abuse

is this a good counter?

Posted by damiantreez > 2017-03-15 14:37 | Report Abuse

im collecting more

Posted by DaitoRyu > 2017-03-15 14:41 | Report Abuse

Yes it is, undervalued, good results and good potential.

Posted by damiantreez > 2017-03-15 16:53 | Report Abuse

http://www.theedgemarkets.com/my/article/oil-prices-jump-after-surprise-us-stock-draw

Posted by oldmanorangtua > 2017-03-16 05:20 | Report Abuse

I have trust in Jay. I bought some PetronM and CB as well. Hope that its a wild car for this 2 years +1 LIKE. Finally i found the answer. THe 700m inventory is not a problem for petronm. Y ? bcoz the aVERAGE revenue of petronm is around 700m per month too. This means when our petrol retail price stay at the same price for one month time like now. Its profit margin still stay at the same level. Dont expect 112m profit again (that was a bonus) just hope for 60m to 80m net profit consistently then its price should easily go to rm12. ie eps 30 sen in each quarter * 4 = rm1.2 eps * pe 10 : MY minimum target RM12. If PE 15 then its sharev price can worth rm18. Petronas Dagang its pe now more than 20.

Posted by oldmanorangtua > 2017-03-16 05:22 | Report Abuse

will add more today

Posted by Jay > 2017-03-16 08:53 | Report Abuse

based on my understanding, the main factors to watch will be retail petrol price (marketing), refining spread and crude oil price (refining).

comparing 3Q16 vs 4Q16 vs 1Q17 so far

Retail price: 1.75,1.75,1.70 vs 1.80, 1.95, 1.90 vs 2.10, 2.30, 2.30
Average Refining spread (Tapis): 4.90 vs 6.78 vs 8.47
Closing crude oil price (USD): 49.1 vs 56.8 vs 52
Closing crude oil price (RM): 203 vs 255 vs 231

Posted by Jay > 2017-03-16 08:58 | Report Abuse

inventory gains/losses will affect the refining segment profit but I don't consider it as core because price fluctuates all the time. more importantly is they are making decent profit (spread) from refining process and are selling well to end customers.

that said, of course you don't expect 40c eps every quarter (can you imagine RM1.60 eps a year!). I think per quarter 20-30c would be great enough for now, and use their cash generated to pay off all borrowings and reward shareholders. as to how much PE the market wants to give them we don't really have control, but last quarter did show that market can't ignore good financials forever

just my 2 cents

Posted by 逍遥子 > 2017-03-16 09:44 | Report Abuse

Traditionally Q1 always higher sales volume due to Chinese New Year. Hence if the 3 main factors i.e. 1) Oil Prices, 2) Refinery margin & 3) Forex rate can stay around at current level, then a decent quarter results will be expected.

Personally I m more interested in their cash flow progress.

Posted by Jay > 2017-03-16 10:08 | Report Abuse

agree with 逍遥子. at the end of the day cashflow is what comforts me for this company

Posted by 逍遥子 > 2017-03-16 10:10 | Report Abuse

@ Jay, cheers !

Posted by zoizai > 2017-03-16 10:59 | Report Abuse

go go go