Melewar is a high potential turnaround company in steel sector. Its top and bottom lines are almost completely correlated with Mycron from now on. The valuation in term of a PER is less than half of Mycron if you exclude losses in Engineering segment. Buy while many are not interested in it.
As stated in latest QR, the Engineering division will only incurred minor losses in future as full provision has been taken into account and supported with special audit report. The future of Melewar is rather bight given the good prospect of Mycron.
QR 31 Dec 2016
The Group’s engineering business suffered significant losses for the current quarter as the Engineering subsidiary recognized additional expected losses on onerous construction contracts ahead of their completion. (Refer to Note A5). For the remaining financial year, the Engineering subsidiary will focus on completing the aforementioned construction contracts within the budgeted losses and unlikely to take on further engagements. Barring any further overrun on budgeted cost-to-completion for these projects and the discharge of contractual obligations thereof, the Group is not expecting further material negative contribution from the Engineering subsidiary apart from its overheads and debt-service costs for the remaining financial year.
Whilst it is possible that the Group’s steel businesses’ performance may eclipse its engineering business’ performance in the 2nd half of the remaining financial year, this would unlikely be enough to surpass the Group’s current year-to-date losses. In this regard, the Group’s prospect outlook for the remaining financial year remains at negative.
wow up_down bro..you should start writing blog. This really looks like an interesting valuetrade but I think most people are not fond of the management.
abangadik. I cut and pasted information in the latest QR. Don't worry. The investors and traders would change their view when the company starting show good profit. If you believe that Mycron has good prospect, why not for Melewar. Melewar owned 71.4% in Mycron.
You got a point there. :D Mycron Melewar, Abangadik. If take out engineering means no lost for Melewar.. contribution is from Mycron. In another words, can consider have both to ripe more upside and control safety for coming qr. after qr we will know if what they say is true for Melewar unless anyone got insider info..hahahaa...
Up-down ...i cant see any signal of showing good profit ,from 0.66c drop to present 0.33c better wait for end may QR,Mycron is steel,Melewar is engineering
Melewar is traded at 34 cents was mainly due to its sucking Engineering division. It won't be cheap when Engineering division suffer minor losses. We don't even know whether there is a reversal of provision for onerous contract in future. I feel comfortable a bit as special audit has been conducted.
To be honest, to be greedy when people are fearful implies if do homework properly. Of course if you are a trader then TA and momentum will be great indicator. For investors like us that has multiple jobs, reading and studying during night and weekend, can buy these shit company when in deepshit and hopefully they turnaround and HUAT!!
melewar really a turnaround company or not? my opinion is to ask the engineering division dun be so stupid again to underbid the project in future. learn from this good lesson. lost money now doesnt mean will lose forever, for me, give the engineering guy some time. see they can perform or not. i choose to stay here. same to last year, i choose to leave lionind at 36sen. due to poor QR result. but now. what happen to lionind? lionind really a turnaround company with proven good QR result.
then now should say im taking risk on the journey to west? time will tell. i choose to stay. thanks for advise. think too much will make shorter life. better fix my mind heading to west. haha.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Superhero77
27 posts
Posted by Superhero77 > 2017-04-21 16:11 | Report Abuse
Yup,saw the Q today quite interesting,look like someone come in to play liao.