October 11, 2008

Masteel to gain from rising steel prices and growing demand

Malaysia Steel Works Bhd is expected to benefit from rising international steel prices and growing demand for its products from the Ninth Malaysia Plan and the Asean region.

Masteel in a release said that “It expects to benefit directly from the MYR 18 billion earmarked for construction and infrastructure in the Ninth Malaysia Plan.” It said demand from the Asean region would also grow due to the abolishment of value added tax rebates and the imposition of 15% export tax on semi finished products, imposed by the Chinese government since June 2007.

Masteel said it expects international steel prices would continue to climb by 30% with demand from China, India, Middle East and Commonwealth of Independent States.

Masteel said it had a superior track record in profit margins due to production efficiency as shown by its 17% average for earnings before interest, taxes, depreciation and amortisation over the last five years.