Steppe Cement Share Discussion Threads

[azalea] 20/11/2014 10:44

davydoo
Up to a point, the above is a come on. The Ptx for both 2014 & 2015 are lower than Westhouse Securities forecasts made last May; that said, the latter did not foresee the 1p div. In short, we will have to wait and see what the Prelims tell us(announced circa Mar). IF it show that the company's forecast of 1.5m tonnes for full year Jan -Dec, have been met, then there is every reason to expect the forecast of 2.5m tonnes to be met in FY 2015. Given that most of the increased production is due to the super efficient low cost Line 5, there should be a significant increase in dividends too. Which together, should almost certainly lift the share price as well, from this current low point. So whilst its a game of patience, in the meantime, we might get news of further buying by Mr Hamzah; which in turn could give us an early pointer as to what we might expect.

[davydoo] 19/11/2014 19:17

It was just the summary of broker opinion provided through info on Barclays stockbrokers website, but I will try and find out who

[azalea] 19/11/2014 17:47

Would you like to share the name/s of the broker/s?

[davydoo] 19/11/2014 15:54

blimey! I've just seen broker forecasts of a 3.41p dividend in 2015, down from 5p just 6 months ago. A suggested yield of virtually 10%!

[azalea] 18/11/2014 15:46

Your welcome.

[davydoo] 18/11/2014 15:07

azalea, thank you for your regular commentary, it's very helpful.

[azalea] 18/11/2014 11:51

The story so far.
Shareholders
If you look back at my posts in December 2012, you can pick up on the millions of shares current holders added to their holdings. On 21/2/2013, chairman Brown held 422,120 shares, by the 24/5/2013 he held 1m. Most notably was Azmi Wan Hamzah whom during Dec 2012 added to hold 46,409,616(21.9%). Since then, he has continued to add, most recently -24/10/2014, he bought 1.8m and now holds 59,185,906(27.03%).

Market update 9/10/2014.Q3 Y-O-Y.(+ Interim data)

Revenues KZT 16.778M(15.399M)+9%
Sales 1.291888m tonnes(1,065,852(+21%)

KAZ market capacity +5%
Imports -6% down to 14% of total consumption
STCM market share Sept 2014 19%(H1 2013 15%)

KAZ ECONOMY 2014 forecast +4%

Production
Proportion from Dry lines 5 & 6 H1 2014 at 66%( 2013 55%)
Wet lines halted Q4 2014.
Capacity H1 2014 0.7m tonnes, H2 forecast 1.5m tonnes. 2015 forecast 2.5m tonnes, with most of growth coming from Dry Line 5.

Brokers consensus forecasts
2014 Ptx £8m Eps 2.55p,P/E 13.93, PEG -.037%
2015 Ptx £10.2M Eps 3.26p. P/E 10.89 PEG 0.39

COSTS to be reduced in H2 and SIGNIFICANTLY lower in 2015 once wet line kilns are stopped and Line 5 reaches capacity. Cash cost from Dry line 5 is estimated to be 35% lower than wet lines and 13% lower than Dry line 6.
All project costs to bring Dry line 5 to completion have been substantially settled.

Transport
purchase of 330 railway wagons completed and paid for. Return on outlay expected to commence 2017.

Clearly a lot of monies have been invested in the last 2 years by shareholders and the company in bringing the all important Dry Line 5 into production, the benefits of which will be maximised in 2015. Considerable savings will also be made by the use of the new 330 railway wagons. Foreign imports of cement have been driven down partly as the result of the Tenge's devaluation against the dollar and the deliberate policy of STCM to stack em high and sell em low. However, having achieved a much larger percentage of the KAZ market and becoming the lowest cost producer in the country, I expect STCM to put its prices up in 2015. With a useful 1p Interim div paid this month, I expect more in 2015. With Hamzah continuing to up his stake, the share price trawling along the bottom of its wide 52 week range, I suspect he could make a bid to capture the full benefits to come in 20i5 and beyond. I have bought in anticipation of seeing a significant rise in 2015.

[azalea] 14/11/2014 15:59

Interesting - 1m shares traded, could be 500k MM - MM transaction, but possibly to meet an order.

[azalea] 13/11/2014 15:39

Several large trades above the bid, these past few days. This pm, cannot get a online quote to buy a mere 5k. I suspect someone, quite possibly Mr Hamzah, is adding again in quick succession, to his now 27.03% stake. If so, it at least adds to the view that the shares are cheap, if not further advancing his plan to make a bid.

[azalea] 29/10/2014 14:28

Someone has bought 0.639m today.

[azalea] 24/10/2014 09:51

News that Mr Azmi Wan Hamzah has again upped his stake(XD)by 1.8m to a new high of 27.03% is very good news, as it further strengthens my case that he will make a bid. If not, at the very least it confirms that he thinks the share price is cheap and that the company will achieve its full production target in 2015 using Dry Lines 5 &,6, whilst closing the expensive wet lines this year. Its strategy of lowering its prices has not only increased its market share from 15% to 19% but also choked off foreign from 14% to 8%. In 2015, I expect this to continue, however this time reaping a double financial bonanza - lowest production costs and raising its prices.

[azalea] 11/10/2014 11:22

There was some notable buying yesterday pm, despite going XD(1p) on 9/11. STCM business is probably the most insulated in the country.

Edit: 16/10. A not inconsiderable buy today, 75k @ 39p

[azalea] 09/10/2014 08:48

Y-O-Y all but one of the economic factors for STCM are positive.Q3 revenues and sales volumes are up 9% and 16% respectively.

Kaz cement market up 5% Q1-Q3 2014. Imports are down 6%. STCM market share was 19% in September.

We know wet line production will be phased out by October 2014. the newest Dry line 5(15% more cost efficient than Dry line 6), will continue to cut overall costs as output reaches maximum in 2015. All the money has been paid for the purchase of 300 new wagons, which will be cash positive in 2017.

I believe the massive investment in Dry line production and new equipment together with strategic pricing decisions will start to pay off increasingly in 2015 and beyond. To that end I put a share price of 60p post FY 2015.

[azalea] 02/10/2014 07:58

News this morning of a 1p dividend payable 31 Oct, is a most welcome surprise for investors,it will be interesting to see how the city's reacts I do not know when its history it last paid a div, so I am treating it as a maiden div. Given the statement it should reinforce the growing potential for STCM in 2015.

[azalea] 22/9/2014 17:45

Notably large trades today. Dry line 5 will reach 100% capacity in 2015 with costs 35% lower than wet lines and 13% below dry Line 6. Wet line klinker production lines will close at end of 2014. The purchase of 330 cement wagons has been completed with a further US$15m available to purchase further wagons.

[azalea] 15/9/2014 10:08

A very solid and detailed Interim report with the company clearly heading to achieve its full potential across the board in 2015. I am definitely sitting tight.

[azalea] 11/9/2014 14:28

From the Interims next week, we will get news on how well the recently commissioned Dry Line 5 has been running for the past 6 months, overall cost savings, sales and increased production will also be a feature. The share price has recover circa 20% from it low this year, but an even greater rise is needed to get back to the year's modest high.

[azalea] 05/9/2014 17:48

Today for (60k)-the first 38p buy since 27/8.

[azalea] 29/8/2014 15:05

With Interims two weeks away, I believe that today's 2m trade @ 37.5p is a 'buy' and a major holder has upped it's holding, without waiting for the results.

[azalea] 26/8/2014 12:08

STCM share price has picked up off its floor, with buyers showing interest. Interims circa 3 weeks away will be interesting.

[azalea] 19/8/2014 12:48

Mach 100.
Given the last rns, unless there is evidence to the contrary, I would have to conclude the fall in the share price is Ukraine related. The spat might go on for some time, but eventually economics will be the deciding factor. Interims are circa mid September. Yes there was an official devaluation of the K. however, the strategy of lowering the price and increasing mkt share paid off. With the enormity of its geography, under development and richness in resources, I'm staying with STCM, regardless.

IF I were you and had a 'few' quid spare, I would take a hard look(DYOR) at OPG(I hold). The consensus forecasts for Eps this year is circa up 45% over last year,and a mouth watering 100% increase on top, the year after; with a maiden dividen promised. By this October it is expected to increase its generating capacity from 275MW to 750MW.

[mach100] 19/8/2014 12:11

Hope so Azalea. I wonder is it a backlash against anything remotely Russian related? The fall makes no sense to me as it is a dominant player. Has the depreciation of the Tenge made any difference to the share price It will of course hit the profit figure if t is denominated in dollars. Tenge is down 20% since January against the dollar though if memory serves it did undergo a devaluation in February. This is a good entry point for any fresh money imy. Not many better shares around at this price. When are the interims?

[azalea] 15/8/2014 11:58

The share price has fallen significantly and for no apparent reason. with Azmi Wan Hamzah holding 26.2%, for less than £3m he could launch a bid at a price below what he and institutional investors paid when they bought millions in late 2013 and 2014. I expect to see the Interims figures notably improve the picture.

[azalea] 27/7/2014 19:03

I am very optimistic on STCM going forward. Increased production, efficiencies and market share, rising sales, new trucks on order at no overall increase in costs and paid for by 2017. Even has the serious potential for a bid from Mr Hamzah.