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23-07-2012, 09:17 PM
Actually, China vtm is a very well managed company....it had increased it output from 133mt to 400++mt at current date and will reach 600mt soon (please do your own research as I just recall from my memory regarding the number)
The current drop is the overall sentiment in the steel and iron ore industry. But it does not really affect china vtm as it operates in sichuan where it is tough to import iron ore from overseas and hence the supply and demand is pretty stable....the current sentiment just cause it to drop until like that....in fact, most analyst reports are very positive on the stock....
It eps is around HK$0.30 and pe around 3 at current price.....it profit marigin is near 50%.......
This is why I keep on buying.....but then I think I have make a mistake......when the sentiment in the industry is bad, then better avoid as most people just sold it down....
And the current drop is also due to power disruption on its mine which should not happen again.......
The current drop is the overall sentiment in the steel and iron ore industry. But it does not really affect china vtm as it operates in sichuan where it is tough to import iron ore from overseas and hence the supply and demand is pretty stable....the current sentiment just cause it to drop until like that....in fact, most analyst reports are very positive on the stock....
It eps is around HK$0.30 and pe around 3 at current price.....it profit marigin is near 50%.......
This is why I keep on buying.....but then I think I have make a mistake......when the sentiment in the industry is bad, then better avoid as most people just sold it down....
And the current drop is also due to power disruption on its mine which should not happen again.......
(22-07-2012, 11:14 PM)dzwm87 Wrote: The thing about mining is you can do a conservative forecast regarding their production.. you could add a conservative iron ore price to smooth out any commodity price volatility. Thereafter, apply discount to all future earnings to arrive at a fair value of the mining stock.
I didn't look much at China VTM. I do know the commodity market is looking quite bad now but my info might be out-of-date.
One thing that interest me is their claim of being the most cost competitive mining company... so if they are cost competitive to survive through this downturn.. it might help in the long term..
Interestingly, iron ore prices seem to be bullish.. so what's causing the price plunge?