Steppe Cement Share Discussion Threads

[aleman] 05/9/2021 13:09

Spent a year below its previous rising channel due to Covid worries? Now good results have seen it regain the old trend? Support at 56p would indicate a shorter term trading range of 56-64p and rising. Given a broker forecast of 8 cents dividend (5.7p) for the next 3 years, one would imagine plenty of support at 56p? (Note - EPS forecast is also 8 cents for 3 years but free cashflow forecast is around 12 cents per share.)


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[mattjos] 05/9/2021 11:21

In most cases the breakout line is briefly revisited shortly after the event, to check what was resistance is now support. All quite normal

[lauders] 05/9/2021 10:26

STCM gets a very brief mention in this piece:

[wilo101] 04/9/2021 14:26

The FX conversion rate from KZT to the US$ has been a disaster was KZT150 to the US$ and is now KZT425 to the US$, so we certainly need a reversal of this trend as CAC and Karcement account and report in KZT and then gets converted into US$ at the Dutch, Malaysia and Labuan holding and then reporting levels, so there were and are also a lot of FX losses booked that would get reversed, should this happen, but remember it was KZT50 to the US$ in 1995 so the trend seems to go only one way, and local CPI is high.

[andydaf] 04/9/2021 12:33

Very good point about the exchange rate mattjos.As a investor i try to spread my risk across several currencies,Reserve currencies come and go,in recent history they have lasted for around one hundred years.Large asset bubbles,excessive debt to provide consumption are tell tale signs of the end.FWIW the kazakhstan economy is not in a bad place,debt is low,oil prices stable and lots of inward investment into industry.When the oil price crashed during covid the tenge lost 10 per cent of its value,oil is back at 70 dollars now the tenge could quite easily regain this 10 per cent.That will go strait to the bottom line.As allways GLA

[mattjos] 03/9/2021 20:35

the chap was quite open about his holding size and his actions. Well done for taking a profit over the 6 month hold.
It's a market. Folk will come and go all the time & no problem with that. The more 'churn' the better the spread is likely to be.

Personally, am quite happy to just sit tight.

I believe there is a longer term currency angle here worth bearing in mind, particularly if you share my opinion that the US$ is grossly overvalued & heading for a fall at some point.

Checking back on the Sept 2005 IPO Docs:

KZTUSD = 136
Ex-Factory Price / tonne cement = KZT9,950
Ex-Factory Price / tonne cement = US$73

Most recent update shows:

KZTUSD = 425
Ex-Factory Price / tonne cement = KZT16,571
Ex-Factory Price / tonne cement = US$39

We're selling cement today at still only 53.4% (in US$ terms) of the prices achieved 16 years ago!

For me, that suggests there is still plenty of room for cement prices to move upwards from here.

These comparisons also show how brutal the currency headwinds have been for Steppe over the last 16 years & also how well the management have managed costs in the business such that we are now in a position to pay a dividend.
16 years of hard graft and penny-pinching during which time they will have been constantly focussed on improving efficiencies in the business.
This is a mindset & behaviour I expect is now fully entrenched in the company.

Quite apart from the Kazakh economy, local cement demand and local pricing, it will not take much in terms of US$ weakness v the Tenge to also start amplifying the reporting figures here.

On current yield, a share price more like £1 - £1.50 is quite possible.
If local cement pricing increased back to 2005 levels (in US$ terms) and the US$ weakens against the KZT then, £2 - £3 is easily achievable, imo.

I am persuaded there is far more to come here in the years ahead & willing to continue adding to my SIPP shareholding each month.

[davr0s] 03/9/2021 19:22

Yes me too

[jeanesy] 03/9/2021 19:14

I continue to hold here and am very comfortable with my investment.

[davr0s] 03/9/2021 19:06

Yeah most of the stuff on BB these days is complete nonsense - I only take note if someone has some actual real information but sadly 99% of posts are people ramping, deramping, speculating or trying to predict the future. So most of it is noise as far as I'm concerned

[eggbaconandbubble] 03/9/2021 18:58

jeansey - don't you think sometimes the story is too good to be.......???

[fozzie] 03/9/2021 17:18

I’m with you Wilo, this is a sleep easy share for me, firmly in my bottom drawer.

[wilo101] 03/9/2021 17:06

Oh yea of little faith and short-termers, you will regret ever selling.

[jeanesy] 03/9/2021 14:41

Well done Gary. Profit is the name of the game for us all.

[gary1966] 03/9/2021 12:40

EBB,

Not sure that is really a fair description of events, as I didn't say the rally had a lot more to go and not sure I was a new contributor. As I said at the time the price was up 2.5% and volume was still good. I sold 35k latter part of Wednesday at 61p and then two tranches yesterday at 59.58p and 59.33p. It isn't a case of what goes up must come down at all. The reason I stated was the elevated RSI. That can come down over time with the share price increasing. I personally will just feel happier when the RSI drops out of overbought territory. If I have to pay a little more then so be it, I like STCM and championed it elsewhere when it was around 30p as I thought it was a gift.

Anyway I have wished nothing but good luck on my departure and haven't bad mouthed the company now I have sold as I like STCM and do not think I have owned it for the last time. But I have banked a nearly £29K profit in 8 months which means a lot to me and my family.

[eggbaconandbubble] 03/9/2021 11:03

"What goes up sir, must come down"

I love the psychology of these bb's.

The share price suddendly has a sizeable uptick and on come a bunch of new contributors telling everyone how they bought at the 'right time' and how brillant they are and that they are quids in.

The price drops back a bit and of course they have top sliced! Again just at the right time despite previous assertions that the rally hasn't fizzled out but has got a lot more to go!!!

New Money shouts, Old Money whispers!

[gary1966] 02/9/2021 16:41

Good luck Wind Dancer. For those that look at the split between buys and sells my two 25K sells have been reported as buys as they were delayed by 1hr. I am grateful to the person that brought them to my attention on one of the RAVP threads and thrilled with a very good profit.

[wind dancer] 02/9/2021 16:34

Well I contrast I’ve just added £20k worth at 59.5p!!

[gary1966] 02/9/2021 15:58

I top sliced late yesterday to take my stake money out but decided to sell the rest today. RSI quite elevated and this has served me well in the past in general and specifically with STCM. Doesn't always pan out and so I am going to keep a very close eye on this one. For the same reasons I have built back up my position in M&G as the RSI has cooled significantly since I sold at 238.5p.

GLA

[gary1966] 01/9/2021 12:29

eggbaconandbubble,

Not sure I would agree it has fizzled out. Up another 2.5% as I type which on the back of yesterday is good. Getting through the next psychological barrier at 60p.

[wilo101] 01/9/2021 12:25

The long-awaited and overdue re-rating is finally underway, it is just a question of time as the basics and value are all in place.

[eggbaconandbubble] 01/9/2021 12:08

Despite doing as much research as possible I still can't get to the reasoning on why STCM's share price was way up in 2006-8 period just before the crash and why the price didnt recover afterwards!

Still yesterday's shift up was better than a slap in the belly with a wet fish, but appears to have fizzled out today - no mention in the press etc. I guess.

[mattjos] 31/8/2021 22:16

Any new recent shareholders, i suggest read the IPO Docs paying particular attention to Pages 14,15 & 16.
As confirmed, on more than one recent occasion by the covering Broker, nothing has changed over the intervening 16 years with regards the Dividend Policy:

"Subject to the availability of distributable profits, the Board’s present intention is to return to shareholders, as dividends, all free cash flow from operations after allowing for ongoing capital expenditure demands, any debt
servicing obligations and any recurring increase to working capital requirements."

Very often, the way to a handsome long-term return on ones investments is simply to Buy & Hold and absolutely nothing else. I'd suggest STCM is just such one of those investments.
STCM is much too boring & (now) too expensive for the trader-chimp brigade & the thread mercifully remains quiet & free of 'rockets'.
Get it in your ISA/SIPP and make sure you deprive the taxman of his cut on the dividends and capital growth.
Tick the divi reinvestment option and simply let time and compounding do their thing until such time as the inevitable £2+ Bid arrives.

I'll leave it at that now as the sensible money has spotted it and this will re-rate to far, far higher in the coming months.

[mattjos] 31/8/2021 20:46

good post Andyaf. I agree.
Quite common place for shares to trade on 20-25 x Divi Value (4%-5% Yield, which nowadays is a terrific yield as compared to most other investments).

20 x Forecast FY Divi of 5.67p is £1.13

Mkt Cap would then be circa £250m / $340m.

Given the plant, the limestone reserves, the customers and the rail wagons .. that would be more like sensible open-market valuation.

[andydaf] 31/8/2021 20:22

I have been predicting a record year for steppe.totally agree with mattjos i think people are going to be suprised by how much cash steppe in a supportive marketplace can generate.Remenber for all intents and purposes we are debt free.I am not a trader so wont be selling any of mine as i feel we are still well undervalued.To build a plant would be closer to 200 million in my opinion.Middle of september are the interims and we will see how good things are.GLA

[jeanesy] 31/8/2021 19:57

Breakout complete today.