KUALA LUMPUR (June 3): Shares in Choo Bee Metal Industries Bhd soared to an all-time high in the morning, after rising as much as 15.45% or 34 sen to RM2.54, as the rally in iron ore price bolstered investors' expectations that the company’s margins will remain elevated to support its earnings.

At noon break, the flat steelmaker pared some gains at RM2.42, still up 22 sen or 10%, for a market capitalisation of RM319 million. There were 3.81 million shares traded. 

Year to date, the stock has rallied 55% from RM1.56 on Jan 4.

For the first quarter ended March 31, 2021 (1QFY21), its net profit jumped more than seven times to RM27.36 million or 20.93 sen per share, from RM3.62 million or 2.77 sen a year ago, buoyed by heightened average selling prices for steel products which boosting its margin.

Revenue for the quarter also jumped 80.28% to RM135.87 million from RM75.37 million, the group’s filing with Bursa Malaysia showed.

Earlier, Reuters reported that China’s benchmark iron ore futures on Dalian bourse jumped more than 7% to 1,170 yuan (US$183.53) a tonne on Tuesday, rallying for a third straight session, boosted by reports that steel hub Tangshan plans to ease requirement for production cuts at its mills.

Spot prices of iron ore with 62% iron content for delivery to China gained US$6 to US$206.50 a tonne on Tuesday, the newswire quoted from SteelHome consultancy.

The locally listed companies involved in flat steel and related sectors include Mycron Steel Bhd, CSC Steel Holdings Bhd, Leon Fuat Bhd, Astino Bhd, Hiap Teck Venture Bhd, United U-Li Corp Bhd, Prestar Resources Bhd, Eonmetall Group Bhd, Leader Steel Holdings Bhd and Tashin Holdings Bhd.

All these counters went up at noon break except Eonmetall, which was unchanged at 64.5 sen.

Leon Fuat and Astino led the pack after jumping to RM1.15 and RM1.44 respectively. Leader Steel added five sen or 7.19% to 74.5 sen and Tashin climbed 3.5 sen or 6.09% to 61 sen.

Mycron Steel shares rose four sen or 5.33% to 79 sen, Prestar Resources advanced six sen or 5.31%, CSC Steel gained five sen or 3.03% to RM1.70, Hiap Teck Venture added 1.5 sen or 3% to 51.5 sen and United U-Li went up two sen or 1.5% to RM1.35.