Press Metal Aluminium Holdings Berhad

Titan Trading Notes For Tuesday [18/2/2025]:

KLCI retraced back towards the 1582 points region with an overall negative market sentiment as we saw over 700 counters closing red for the day. Daily trading volume maintained around the 2.98 billion mark, which is still alright.

Main stocks that showed strong buying momentum today would be the likes if GENM, ASIAPLY, LHI, PERDANA, TANCO, NOTION, GENETEC, and PMETAL. All of which were able to sustain their rallies throughout the day despite the weak market sentiment on the top volumes list.

$GENM / 4715 (GENTING MALAYSIA BERHAD) definitely having a pretty interesting recovery here since breaking out from its RM 2.30+ major resistance from the day before, breaking out towards the RM 2.45+ regions today with good volume and buying momentum.

So far looking quite strong here and as long as able to hold above its RM 2.35+ immediate support levels, could continue on towards and beyond its RM 2.55 major resistance levels soon for a further recovery rally.

Will be monitoring GENM closely here.

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD) on the other hand seems to be recovering quite well too since it retested its RM 4.80+ major support levels just a few weeks ago on the daily chart. Today, it was able to breakout strong towards the RM 5.20 regions with good volume.

So far looking quite well off here and as long as able to hold above its RM 5 immediate support level on the daily chart, could breakout towards and beyond its RM 5.20++ major resistance levels for a further breakout.

Will be monitoring PMETAL closely.

$NATGATE / 0270 (NATIONGATE HOLDINGS BERHAD) on the other hand been consolidating over the past week here with RM 1.94+ as the main support levels, but was able to rebound strong back towards the RM 2 regions towards closing today with good volume.

This could be a sign that it will be ripe for an incoming breakout towards its RM 2.10 - RM 2.20+ major resistance levels soon in the coming week here. Overall still looking quite strong.

Will be monitoring NATGATE closely.

UOBKH TOP PICKS 2025

Adequately Charged Up.

While likely to kick off the year with caution, the FBMKLCI is still adequately electrified to deliver good positive gains, charged up by robust domestic liquidity. We introduce our end-25 FBMKLCI target of 1,800, and we anticipate the market to steadily adopt a progressively risk-on mode as we expect US president-elect Donald Trump to be pragmatic in executing trade policies. Key investment themes include Iskandar 2.0, data centre rollout and China’s economic recovery.

Compelling investment themes include: a) Iskandar 2.0; b) data centre project rollouts; c) China’s improving economic momentum; d) domestic consumption acceleration (tied to wage hikes); e) E&E sector: trade diversion and global semiconductor cycle recovery; f) Green Agenda and National Energy Transition Roadmap (NETR) opportunities; and g) blockchain. We also foresee trading opportunities in glove stocks (riding on the US’ scheduled steep tariff hikes on China glove products), selected consumer stocks (discretionary domestic consumption boosted by wage hikes), M&A activities and quality dividend yielders.

$RGB / 0037 (RGB INTERNATIONAL BHD)
$HLBANK / 5819 (HONG LEONG BANK BERHAD)
$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by RHB

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by Maybank

KUALA LUMPUR: Press Metal Aluminium Holdings Bhd is expected to record double-digit earnings growth in the financial year 2025 (FY25), said Hong Leong Investment Bank Bhd. 

© New Straits Times Press (M) Bhd

Press Metal Aluminium Holdings Bhd is expected to face challenges in the second half of the year (2H24) before charting commendable earnings growth in the financial year 2025 (FY25).

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by HLIB

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by RHB

帝亿置地与齐力工业签订协议，成为“HALO”集中劳工宿舍项目的首位客户
“HALO”项目将提供可持续的、舒适的员工住宿，体现集团通过具有影响力的房地产开发推动ESG
$TITIJYA / 5239 (TITIJAYA LAND BERHAD) $PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD) #CLQ #HALO

TITIJAYA MEMETERAI PERJANJIAN DENGAN PRESS METAL SEBAGAI PELANGGAN PERTAMA PROJEK KUARTERS PEKERJA BERPUSAT (CLQ) “HALO”
HALO menyediakan penginapan pekerja yang lestari dan selesa, mencerminkan komitmen Kumpulan dalam memajukan ESG melalui pembangunan hartanah yang berimpak tinggi.
$TITIJYA / 5239 (TITIJAYA LAND BERHAD) $PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD) #CLQ #HALO

TITIJAYA SECURES PRESS METAL AS FIRST CUSTOMER FOR CENTRALISED LABOUR QUARTERS (CLQ) PROJECT, “HALO”
HALO to provide sustainable, hospitable worker accommodation, reflecting the Group’s commitment to advancing ESG through impactful real estate developments
$TITIJYA / 5239 (TITIJAYA LAND BERHAD) $PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD) #CLQ #HALO

Titan Trading Notes For Monday [30/9/2024]:

$KLCI retraced back towards the 1660 points region with an overall mixed market sentiment as we still saw over 640 counters closing red for the day. Daily trading volume also saw a dip back towards the 3 billion mark, which isn't exactly a pleasant sight.

Main stocks that showed strong buying momentum would be the likes of CAPITALA, VS, GAMUDA, PMETAL, and SIMEPROP. All of which were able to sustain their rallies throughout the day on the top volumes list despite the mixed market sentiment.

CAPITALA had a pretty strong breakout towards the RM 0.95 regions with huge volume and buying momentum during last Friday here despite being overbought recently.

So far still looking quite strong here and as long as able to hold above its RM 0.90 main support levels, could continue on towards and beyond the RM 0.95+ regions to test the RM 1 regions soon in the coming week.

Will be monitoring CAPITALA closely here.

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD) on the other hand since retracing over the past few months, was able to breakout strong from its RM 5 main downtrend resistance during last Friday and rallied all the way towards the RM 5.20+ regions with huge volume and buying momentum here.

So far still looking quite strong but seems to be facing some selling pressure around the RM 5.20 regions. For now as long as able to hold above its RM 5 immediate support, could start trending up back towards the RM 5.20 - RM 5.40+ regions soon in the coming week.

Will be monitoring PMETAL closely here.

$SIMEPROP / 5288 (SIME DARBY PROPERTY BERHAD) since retracing all the way back towards the RM 1.44 support levels last week, had been able to hold quite well and rebounded back towards the RM 1.50+ regions on Friday.

Although it still was met with some selling pressure, the buying momentum seems to be coming back already. As long as able to hold above the RM 1.44 support, could continue on towards and beyond the RM 1.60+ regions soon in the coming weeks.

Will be monitoring SIMEPROP closely here

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by Kenanga
OUTPERFORM – TP RM5.80

" Venturing 3rd Alumina Refinery”

PMETAL is investing RM1.04b for an 80% stake in a JV project for an alumina refinery in West Kalimantan, Indonesia. We are positive on this venture as the investment aims to secure alumina supply, with two other investments in alumina refinery, ensuring 75% of its alumina requirement is locked in. Given its balance sheet and cashflow generating ability, PMETAL can finance this without taking on debt. However, it has to equity account for this investment. We maintain our estimates, TP of RM5.80 and OUTPERFORM call.

Analyst:
Teh Kian Yeong
tehky@kenanga.com.my

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by Kenanga

OUTPERFORM– TP RM5.80

" OUTPERFORM”

PMETAL’s smelting plant in Samalaju caught fire which affected 100 pots or a-third of installed capacity in Plant 3. It expects to take c.4 months to restore operations which will reduce the group’s smelting capacity by 3% in FY24 while the damaged assets and loss of revenue are expected to be covered by insurance. Meanwhile, aluminium prices remain volatile which lead us to trim our assumptions. As such, we cut FY24/FY25 earnings forecasts by 18%/21% and TP by 9% to RM5.80, though OUTPERFORM rating is maintained.

Analyst:
Teh Kian Yeong
tehky@kenanga.com.my

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)

♨️ Fresh Ingot from Smelters ♨️

sharing from remiser $PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)

*PMETAL (Maintain BUY, TP at RM6.30 based on 28.0x 2025 PE)*

_Press Metal's share price has dropped by approximately 5% today following news_
https://cutt.ly/4eEB3rw3

*A factory fire occurred at the Samalaju Industrial Park in Bintulu, starting late last night.* The Malaysian Fire and Rescue Department (JBPM) Sarawak received an emergency call at around 11:50 PM and dispatched teams from Samalaju and Bintulu Fire and Rescue Stations.

*The fire destroyed around 10% of the factory structure.* Preliminary investigations suggest the fire was caused by *a leak during the aluminum smelting process. All workers were safely evacuated by the Emergency Action Team (ERT). Firefighters took seven hours to extinguish the fire, which ended at 6:20 AM after ensuring the area was safe and the smelting area had cooled down.

*Quick comment:*

After a quick chat with management, we confirmed that this is real. *The fire incident was main due to pot leakage due to heavy rain season.*

This fire incident has affected about *9% of their production, and it will take approximately 3-4 months to restore operations.* As a result, it is expected to impact about *3-4% of the 2024 annual output.* Management is confident that this issue *will be resolved within 2024* and will not carry over into 2025.

*Financial impact.* Management mentioned that this will *reduce the 2024 profit before tax (PBT) by about 3%. However, most of the loss will be covered by insurance.* That said, the *3% PBT loss does not yet include compensation from insurance.* Further details are pending management guidance.

At this juncture, we still *Maintain BUY with an unchanged target price of RM6.30, still based on 28.0x 2025F PE (which is at -0.5SD below its five-year forward PE mean)*, as we believe this is a temporary impact that will not extend into 2025.

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by RHB
Buy – TP RM 6.53

" Journey To The East; Reiterate BUY ”

We visited Press Metal’s Samalaju manufacturing facility and came away encouraged on the sector’s mid- to long-term earnings prospects. Our positive outlook on aluminium is primarily driven by the ongoing rise in ASPs, and "green push" towards EVs and solar panels. PMAH’s valuation is undemanding, 21x 2025F P/E or 0.9SD below the 5-year mean of 25x

Analyst:
Cindy Lee
cindy.chin.hui@rhbgroup.com

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by Maybank
BUY – TP RM 5.70

" 2Q24: Below expectations”

2Q24 results missed our expectations. Hence, we adjust our FY24-26E earnings by -18%/-6%/+12% respectively after: i) revising our aluminium spot prices assumptions to USD2,450/2,500,2,550/t (from USD2,500/2,500/2,440/t); ii) updating PMETAL’s hedging ratios of 40% @ USD2,600 for FY24E, 35% @ USD2,650 for FY25E and 30% @ USD2,700 for FY26E; and iii) an increase in logistics cost assumptions. Our TP is reduced to MYR5.70 (from MYR6.10), pegged to a -1SD to its 5-year mean PER of 25x. Maintain BUY.

Analyst:
Jeremie Yap
jeremie.yap@maybank-ib.com

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by RHB
Buy - TP RM6.53

"Unlocking Potential Amidst Evolving Market Dynamics"

ReiterateBUY,newMYR6.53TP(fromMYR6.67),27%upside,c.1%yield. 1H24 core earnings of MYR931.5m were below our and Street’s expectations, as we anticipate a softer quarter ahead. Despite this, we remain optimistic on aluminium, primarily due to the recovery of aluminium ASPs and the "green push" for EVs. Press Metal’s valuation appears undemanding, trading at 22x 2025F P/E (0.7SD below the 5-year mean of 25x).

Analyst:
Cindy Lee
cindy.chin.hui@rhbgroup.com

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by Kenanga
Outperform - TP RM6.35

"Firmer ASP to Support Earnings Growth"

PMETAL’s 1HFY24 results met expectations. Its 1HFY24 core profit jumped 54% YoY on strong ASP and better contribution from associate PT Bintan. Aluminium prices are expected to stay firm on the back of the demand recovery in China while supply will be capped by geopolitical tensions. We keep our earnings and TP of RM6.35 unchanged. It remains an OUTPERFORM.

Analyst:
Teh Kian Yeong
tehky@kenanga.com.my

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by HLIB
Buy - TP RM6.51

"Numbers inline"

PMETAL posted 2Q24 core earnings of RM516.7m (+24% QoQ, +65% YoY), lifting 1H24 core net profit to RM932.9m, inline with our and street estimates. Core net profit rose 65% YoY/ 54% YTD as average LME aluminium spot prices were up 11% YoY and 12% YTD. Also, contribution from its associate PT Bintan surged (2x YoY, 3x YTD) as its 2m annual alumina refinery capacity was fully commissioned in 2Q23, coupled with stronger realised alumina prices. Maintain our forecasts and BUY call with unchanged TP of RM6.51 – based on a PE multiple of 28x on FY25f profits.

Analyst:
Brian Chin
brianchy@hlib.hongleong.com.my

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)

U Mobile's Corporate Ownership

U Mobile, Malaysia's third-largest telecommunications company, is expected to file for an IPO soon. However, given the current market volatility, it's uncertain whether the IPO will be postponed again. Regardless, now is an opportune time to examine the company's ownership structure. Due to varying information online, The Malaysianist has provided a useful summary.

Interestingly, despite the common association of U Mobile with Tan Sri Vincent Tan, he is not the largest shareholder. The primary shareholder is Straits Mobile Investments Pte Ltd from Singapore, which is owned by Temasek Holdings. The second-largest shareholder is the current Yang di-Pertuan Agong, Sultan Ibrahim. Tan Sri Vincent Tan follows, holding a 15.4% stake.

Surprisingly, $MAGNUM / 3859 (MAGNUM BERHAD) is also among the major shareholders of U Mobile, along with Tan Sri Paul Koon Poh Keong, the owner of $PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD), who holds a 2.4% stake in the company.

$PMBTECH / 7172 (PMB TECHNOLOGY BERHAD)
$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by RHB
BUY – TP RMR6.67

“Positive Momentum to Continue; Upgrade To BUY”

We believe the narrowing surplus and increasing demand for aluminium will further drive up LME aluminium Asps. Consequently, we expect strong growth momentum to continue into 2Q24, driven by higher ASPs. Our DCF-derived TP implies 27.5x2025F P/E vs the 5-year mean of 25.5x – predicated by increasing awareness towards lower carbon footprints smelters and the gradual recovery in global demand. This report marks the transfer of Press Metal coverage to Cindy Lee.

Analyst:
Cindy Lee
cindy.chin.hui@rhbgroup.com

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by HLIB
Buy – TP RM6.51

“To ride on stronger aluminium price"

We anticipate PMETAL’s 2Q24 core earnings to come in at the range of RM480-500m (+15% to 20% QoQ, +53% to 60% YoY), bringing 1HFY24 sum to RM897-917m (+48% to 51% YoY) – representing for 48-49% of our FY24 forecasts. Average LME aluminium price rose 15% QoQ to USD2,523/MT but alumina price continued its uptrend in 2Q24 (+14% QoQ) due to tightening supply induced by Alcoa’s suspension of 2.2m ton at its Kwinana site and Rio Tinto’s force majeure declaration on its alumina supplies. We view the imminent listing of PT Bintan positively as it paves way for capacity expansion from its current alumina output of 2mtpa. We maintain our forecasts and BUY call on PMETAL with TP of RM6.51, based on a PE multiple of 28x on FY25f profits.

Analyst:
Brian Chin
brianchy@hlib.hongleong.com.my

General Meetings: Outcome of Meeting

$PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD)
Research by Maybank
Buy – TP RM6.10

“A share swap agreement to enhance tax efficiency"

Overnight (20 Jun 2024), PMETAL proposed to undertake a share swap, where PMETAL will divest its entire direct 25% stake in PT Bintan to HK Prime Aluminium Investment (a 100%-subsidiary of Nanshan Aluminium) for a 25.59% stake in Nanshan Aluminium, worth about USD329.8m each. We are neutral on this development. No change to our earnings estimates. We maintain a BUY on PMETAL with an unchanged TP of MYR6.10, pegged to 25x FY25E PER.

Analyst:
Jeremie Yap
jeremie.yap@maybank-ib.com

OTHERSPRESS METAL ALUMINIUM HOLDINGS BERHAD ("PMAHB" OR "COMPANY")

PROPOSED SWAP OF DIRECT EQUITY INTEREST IN PT BINTAN ALUMINA INDONESIA ("PT BAI") FOR DIRECT EQUITY INTEREST IN NANSHAN ALUMINIUM INTERNATIONAL HOLDINGS LIMITED ("NAIHL") ("PROPOSED SHARE SWAP")