Friends, HUAAN is being goreng now....so pick it up.


Today up 4 cents but profit taking sets in and last gain is 2 cents.....more to come perhaps as it is now being goreng.......today's volume is about 35 million shares.



SOMETHING ON HUAAN


1) HUAAN IS A GOOD BUY.

2) Recent prices seem to suggest Hua-An has rock-bottomed; Hua-An's current share price valuation is highly undemanding; Hua-An has NTA of RM0.610;

3) Hua-An is back in the black with improved company outlook due to recovery of the steel industry; for example, the U.S. steel industry is currently in an extended bull run;

4) At the moment, the demand for coking coal is greater than its supply due to coal shortage (so severe parts of China recently interrupted electricity supply in the cold winter)

5) Rise in coal prices due to shortage correlates to better coke prices and improved margins, since Hua-An can pass the increment to its customers;

6) Hua-An is now purchasing and "washing" its own raw coal at greatly reduced cost;

7) Previous clamping down by the Chinese government on inefficient metallurgical coke producers will be to Hua-An's advantage (it currently has about 10% of Shandong's market share);

Cool Hua-An has a reasonable management team and skilled workers (coal and coking coal are core Chinese industries);

9) Hua-An's major shareholder is Tunku Naquiyuddin (Antah) via Rock Point Alliance Pte Ltd., and not a Chinese who might dump Hua-An shares.


-------------------

1) The shortage of coal may extend and cause severity (the current problem is not expected to extend beyond the cold winter; furthermore, Hua-An's factory is strategically located near coal mines);

2) Corporate mismanagement and fraud (distrust of Chinese counters);

3) Bank of China's monetary policies of tightening money supply and raising interest rates may pressurize regional stock markets;

4) Global and local stock markets collapse in 2011 (unlikely, we are only going into the 3rd year of the up-cycle since the 2007 sub-prime mortgage crisis, so consolidation at most).


Analysis

Since there is no direct play on coal on the local scene at the time of writing, Hua-An is the closest alternative in terms of coking coal. China, in the past a huge net exporter of coking coal, has streamlined coking coal export...previously due to environmental issues, now due to extreme global shortage. Will not be surprised if a Chinese steel conglomerate bids for Hua-an, seemingly the current trend in Asia, namely ICVL (India) and Rio Tinto (Australia).

MORE ON HUAAN..


Costlier coal unlikely to hit Sino Hua-An


UPDATE (@ 10/01/11)

Rising coal prices around the world has minimal effect on Hua-An's raw material costs as expected. It may even be a plus.

http://www.btimes.com.my/Current_News/BTIM.../6SINO/Article/



LATEST REPORT: Published: 2011/01/10


Cash Cash Costlier coal unlikely to hit Sino Hua-An


By Hamisah Hamid
Published: 2011/01/10


RISING international coal prices due to the floods in Australia's coal-rich state of Queensland are not likely to have a significant impact on metallurgical coke manufacturer Sino Hua-An International Bhd's (2739) plant in China.


RISING international coal prices due to the floods in Australia's coal-rich state of Queensland are not likely to have a significant impact on metallurgical coke manufacturer Sino Hua-An International Bhd's (2739) plant in China.

Besides getting its supply of coking coal from China domestic mines, Sino Hua-An also buys cheaper coking coal in bulk for the winter season.

Vice president corporate communication and investors relations Bernard Tan said the company's metallurgical coke plant in Shandong province buys and uses most of its coking coal from mines located in Shandong, Henan and Shanxi provinces.

"Every year during winter season in North Eastern China, the normal domestic coking coal pricing trend tends to increase a little as the extraction rate from the mines is usually slower than expected.
"As part of Sino Hua-An's contingency plan, we usually increase our coking coal inventory during winter season by negotiating and purchasing cheaper coking coal in bulk from our raw material suppliers," he said in a statement.

Sino Hua-An, the first China-based company to be listed on Bursa Malaysia, produces metallurgical coke from coal. Coke is a critical raw material in steel-making.

Tan said the company's usual coking coal inventory is about 50,000 tonnes but currently, it is more than triple to 170,000 tonnes. This inventory level is enough for more than a month's use.

Coal prices for delivery in March have already risen to some US$130 (RM398) a tonne, from around US$100 (RM306) a tonne at the start of December last year.

The floods in Queensland, the worst in decades that has displaced hundreds of thousand people, may temporarily halt production and export of high-grade coking coal and force the international coking coal price to skyrocket to over US$300 (RM921) per tonne in the near future.

At the same time, the rising crude oil price exceeding US$90 (RM276) per barrel is working in favour of Sino Hua-An.

Tan said the company's two main by-products, which are crude benzene and tar oil, are oil-based.

"Therefore, the rising crude oil prices also 'push' up the selling prices of our by-products accordingly," he said.

Read more: Costlier coal unlikely to hit Sino Hua-An http://www.btimes.com.my/Current_News/BTIM.../#ixzz1DSQwFj00



CHEEERS......THE FACTS ARE HERE, YOU MAKE YOUR OWN DECISION BUT AS IT'S NOW BEING GORENG, IT'S WORTHWHILE TO PICK IT UP.

Already started goreng........more upswing today!!




Cheers.

Time to necroooooooo.

It's been a while now.

The stars are alligned for another goreng round, albeit at a smaller scale.any technical traders around dipping into this?

Necro now.....

This post has been edited by arcadicus: Dec 14 2020, 12:25 PM

Hmmm... Out of nowhere.