not vested
Trading Buy: MASTEEL-5098
(Last price: RM1.22, Potential upside +14.8%)
Company Profile
MASTEEL is one of the biggest manufacturers of steel billets and steel bars.in Malaysia. Besides, it has an associate company which manufactures radioisotopes for the imaging of cancer cells.
Trading Catalyst
Positive earnings outlook as steel prices are likely to remain strong, buoyed by strengthening RM/US$, Malaysia’s government safeguard duties coupled with the higher China steel prices following a confluence of factors including stable demand, capacity cuts and policies to reduce pollution.
MASTEEL is only trading at 0.54x P/BV and 6.1x FY17 P/E (refer FIG2), 62% and 33% below its peers, respectively.
Positive triangle breakout to test RM1.28-1.40 levels.
Technical View
Resistance: RM1.28 / RM1.35 / RM1.40
Support: RM1.18 / RM1.15
Cut loss: RM1.14
Key Financial Stats
Trading at 6.1x FY17 P/E (est), 33% below peers
Undemanding P/B of 0.54x, a 62% discount vs peers
Source: Bloomberg, HLIB