BWFN 3013: INVESTMENT ANALYSIS

PREPARE TO: MR. AFIRUDDIN BIN TAPA

GROUP C

INDIVIDUAL ASSIGNMENT:
COMPARE AND CONTRAST THE POTENTIAL OUTLOOK OF
PUBLIC-LISTED COMPANIES

PREPARED BY: ABDUL WASIM BIN MUHAMAD SABRI (242842)

SUBMISSION DATE: 24th OCTOBER 2017

Introduction

Metal Production Company

Malaysia Steel Works (KL) Bhd and The Malaysia Smelting Corporation Berhad.

Malaysia Steel Works (KL) Bhd factories

As a steel manufacturer, Malaysia Steel Works (KL) Bhd began its operations in 1971,
producing commercial grade mild steel round bars, steel billets at its rolling mill in Petaling Jaya,
Selangor. Located strategically at Petaling Jaya and Bukit Raja, Klang in the state of Selangor.
The Bukit Raja factory produces steel bars, steel billets which are the feed stock for the rolling
mill in Petaling Jaya. Both the manufacturing plants are equipped with modern equipment and
are fully computerised to produce precision quality products from both the mills. The principal
activities of Masteel is in the manufacturing and marketing of high tensile steel bars, mild steel
bars and prime steel billets. Masteel has a wide network of customers domestically as well as
internationally. The finished products manufactured by Masteel conforms to those required by
SIRIM (MS 146:2000) as well as the ISO 9001 standards.

MSC – a global integrated tin mining and smelting group

The Malaysia Smelting Corporation Berhad ("MSC" or "the Company") and its subsidiaries
("MSC Group" or "the Group") is currently one of the world’s leading integrated producers of tin
metal and tin based products and a global leader in custom tin smelting since 1887. In 2016, the
Group produced 26,802 tonnes of tin metal thus maintaining its position as the second largest
supplier of tin metal in the world. MSC is listed both on the Main Market of Bursa Malaysia
since 15 December 1994 and the Main Board of Singapore Exchange ("SGX-ST") since 27
January 2011. MSC is a subsidiary of The Straits Trading Company Limited ("STC") of
Singapore.
 For Masteel as at 30th June 2017, a total of 1,213,800 shares were held as treasury shares
out of its total issued share capital of 244,508,003 shares at an average price of RM0.74 per
share. The share buyback transactions were financed by internally generated funds. For
Malaysian smelting corporation The Group’s 30th June 2017 share of results of associates and
joint ventures recorded a net share of profit of RM0.25 million in 1Q 2017 compared with
RM0.35 million in 1Q 2016. For Masteel the income is RM575,639,000 and MSC income is
RM14,467,000.

For Masteel company the group reported a profit before tax of RM12.50 million on the
revenue of RM290.76 million for the current quarter as compared to a profit before tax of
RM12.15 million on the revenue of RM268.35 million for the previous year corresponding
quarter. The increase in revenue in the current quarter were mainly attributed to higher selling
price due to recovery of steel price in China and stronger domestic demand. The current quarter
recorded a higher profit before tax mainly due to higher forex gain from the strengthening of
Malaysia Ringgit.

For MSC Group revenue was RM406.61 million in 1Q 2017, slightly lower compared
with RM408.40 million in 1Q 2016. Group profit before tax was RM17.7 million in 1Q 2017
compared with RM32.83 million in 1Q 2016. This was mainly due to the absence of a favourable
inventory valuation adjustment and a higher net foreign exchange loss. The international tin
smelting segment recorded a profit before tax of RM5.41 million in 1Q 2017 compared with
RM26.38 million in 1Q 2016. This was mainly due to lower production, a higher net foreign
exchange loss and the absence of a favourable inventory valuation adjustment. The tin mining
segment recorded a higher profit before tax of RM14.72 million in 1Q 2017 compared with
RM6.22 million in 1Q 2016. This was mainly due to higher tin prices in 1Q 2017. The Group’s
share of results of associates and joint ventures recorded a net share of profit of RM0.25 million
in 1Q 2017 compared with RM0.35 million in 1Q 2016.
Conclusion

In the nutshell, the company of Masteel is more higher income compare to MSC group but both
have advantage in term of customer need because the market for metal is high and therefore it
can generate large amount of profit from all kind of market. The demand is keep on increasing in
all type of sector. Thus any amount of loss can be recovered in a blink for company to survive
need the best management to keep rolling on long term.
References

http://www.msmelt.com/

http://www.masteel.com.my/

http://www.bursamalaysia.com/market/listed-companies/list-of-companies/plc-
profile.html?stock_code=5916

http://www.bursamalaysia.com/market/listed-companies/list-of-companies/plc-
profile.html?stock_code=5098

http://www.bursamalaysia.com/market/listed-companies/company-announcements/5524497

http://www.bursamalaysia.com/market/listed-companies/company-announcements/5505509

http://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?id=197096&name=EA_
FR_ATTACHMENTS

http://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?id=196752&name=EA_
FR_ATTACHMENTS