Remember the LORD for it is he who gives you the ability to produce wealth and so confirms his covenant... Deut. 8:18

Friday, August 8, 2008

Steel Counter Potential

With the listing of Perwaja on Weds 20th Aug., there is a potential steel related counters may stage a rally. So be prepared..

Ann Joo RM3.68
4 Q nett profit RM267 million. Shares 522 million. Earnings per share = RM267/522= 51 sen.
Therefore the PER is 368/51= 7.
Nett asset = 159. Price/book= 368/159= 2.3
Earnings/nett asset= 51/159= 34%

Perwaja IPO RM2.90
4 Q profit RM215M. Shares 560M. EPS = 38.5 sen
If IPO is RM2.90, then PER is 290/38.5 = 7.5 which is similar to Ann Joo
If Perwaja moves beyond Rm2.90, expect other steel counter to rally,,?

Southern Steel RM2.90
4Q profit RM180M. Shares 419M. EPS = 43 sen
PER is 6.7 Price/book is 1.66 Earning/asset is 24%

Huaan RM0.59
4Q profit RM125M. Shares 1100 M. EPS = 11 sen
PER is 5.2 Price/book is 0.9 Earning/asset is 19%

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