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Koon Yew Yin's Blog

Author: Koon Yew Yin   |   Latest post: Thu, 6 May 2021, 9:32 AM

 

LB Aluminium is much cheaper than Press Metal & PMB - Koon Yew Yin

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LB Aluminium Bhd is a Malaysia based company principally engaged in the business of manufacturing, marketing and trading of aluminium extrusions. Their product acts as a raw material for transport, construction, consumer goods, packaging as well as electrical engineering due to its lightweight, an excellent conductor of electricity and durability in nature. The company has expanded its business across Europe, North America, China, Australia, New Zealand and South-East Asia. Most of the revenue is generated by the company in the domestic market itself.

Press Metal Aluminium Holdings Bhd manufactures and sells extruded aluminium and other aluminium products to customers worldwide. The company operates in two segments based on function. The smelting and extrusion segment, which generates the vast majority of revenue, purchases aluminium scrap and produces extruded aluminium and aluminium alloys to industrial customers. The trading segment markets aluminium products. Press Metal has two customers that each account for over 10% of the firm’s revenue. The majority of Press Metal’s revenue comes from Asia and Europe.

PMB Technology Bhd is principally an investment holding company. The firm is engaged in the manufacturing and/or distribution of access equipment and other aluminium related products and distribution of extruded aluminium profiles and related building materials. The principal activities of the group are: Design, fabrication, and installation of aluminium curtain wall, skylight and facade works, Fabrication and installation of aluminium formwork system, Manufacturing and marketing of aluminium access equipment and Trading and distribution of aluminium related products and building materials. The group manufactures access equipment like ladders and scaffold tower. Majority of the company's revenue is derived from Malaysia.

The chart above shows that the price of aluminium has been going up every month. It has gone up about 50% in the last 1 year. 

Name

Current Price 

Latest EPS

Annual EPS

PE

LB Aluminium

Rm 1.20

6 sen

24

5

Press Metal

Rm 10.02

3.53 sen

14.12 sen

71

PMB

Rm 5.62

5.31 sen

21.24 sen

27

Conclusion:

All the 3 companies are aluminium products manufacturers. The above table is self-explanatory. AL Aluminium is selling at PE 5 while Press Metal is selling at PE 71 and PMB is selling at PE 27. That is why LB Aluminium share price is shooting up because it is selling so much cheaper than its competitors.  

 

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Related Stocks

Chart Stock Name Last Change Volume 
LBALUM 1.20 -0.03 (2.44%) 24,823,000 
PMETAL 5.38 +0.08 (1.51%) 7,447,000 
PMBTECH 5.70 +0.07 (1.24%) 13,300 

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VenFx Not exactly the same class
Uncle wisdom doesn't seem to be confused over their biz segment yaa.

Instead of recently surge of LBA , I'll go all out for Arank.
No joke.

Wish Dato KYY healthy always.
I do enjoy your uniquely view in your pass articles .

Thank you.
11/04/2021 9:27 PM
Sslee Aluminium extraction:
Aluminium ore is called bauxite . The bauxite is purified to produce aluminium oxide, a white powder from which aluminium can be extracted. The extraction is done by electrolysis

Billet casting:
To produce these aluminum billets, the process is: melting → casting → billet sawing → aluminum billet

Extrusion:
Aluminum extrusion is a process by which aluminum alloy material is forced through a die with a specific cross-sectional profile. A powerful ram pushes the aluminum through the die and it emerges from the die opening. When it does, it comes out in the same shape as the die,
this process is able to create an unlimited number of complex shapes

Fabrication.
After extrusion fabrication are used to creat aluminium frames.

Press metal
Fully Integrated Operation
From upstream smelting activities to downstream extruding operations, Press Metal is a fully integrated producer of aluminium products. With three smelting plants in Malaysia alone, we have an annual capacity of 760,000 tonnes of primary aluminium production. Our PMB-branded aluminium ingots produced by our Samalaju smelter are listed on the London Metal Exchange as a high-grade primary aluminium product.

Only Pressmetal will benefit from high price of aluminium because only Pmetal have upstream smelting/aluminum extraction activities with cheap electrical cost (hydro power) for electrolysis.

LB need to buy the aluminium ingots to do aluminium extrusion and fribrication
11/04/2021 10:24 PM
Sslee LB last quarter profit of 14.951 million 4.498 million is from share of profit from associate company (Property Developer)
11/04/2021 10:55 PM
skyz 2nd article is up! Still chasing? later cry also no tears after KYY dump his final portion after selling silently
12/04/2021 9:16 AM
k3nthiew Comparing Apple and Orange?? Pmetal is upstream while LB is downstream, Pmetal is indirect supplier to LB in fact. When upstream do well, downstream will be loser in fact.
12/04/2021 10:53 AM
pekanwoohoo Time to sell when KYY promoting
12/04/2021 11:47 AM
Bursawise hahahahaha…..
12/04/2021 11:53 AM
PATIKAYA kyy next stop pa ke
12/04/2021 12:51 PM
Airline Bobby HAHHA buaya gonna in LB . everyone sell high high !!!
12/04/2021 6:58 PM
Zuliana OMG.
12/04/2021 11:57 PM
dusti GAME OVER FOR LB ALUM. GO HUNT ELSEWHERE
13/04/2021 11:02 AM
WY Chan unethical old man....
13/04/2021 1:16 PM
wikioon KYY dont understand the aluminium industry. its very obvious that BIGGEST benefactor is Press Metal because they are in the upstream smelting industry that sells Aluminium as a raw material. Any price increase in LME aluminium is an additional topline benefit to PM.

LBALum and Alcom are just SMALLER extrusion players. Their costing is the aluminium raw material that they buy and extrude into aluminium products. That means their cost is also increasing - their profit and loss depends on the margin they charge on top of their cost. Of course increased demand = increased volume = increased profit (but ALL this are CAPPED).
13/04/2021 4:57 PM
Zuliana OMG!
Another underrated stock.
U know & I know lah.
Hahaha
13/04/2021 6:46 PM
mamatede pmbtech already sold its aluminum extrusion business to Pmetal a few years back. Now they are focusing on silica. Noob la u
15/04/2021 12:25 PM


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