WZSATU worth to invest while waiting for Bauxite Mining SOP to be ready end of this year to restart mining

Alert to all investor, because I want to inform you that good things are turning up for WZSATU again after a long 3 year wait.

Now it is the time to make WZSATU great again in 2019.

If you are wondering, how can WZSATU be great again this year....

So these are some of the keys point that can make WZSATU great again in the radar of investor/trader/punter.

1. Bauxite Mining ban already uplifted, and pending official SOP to have a go ahead green light, then the bauxite mining industry can be restarted.

https://www.thestar.com.my/news/nation/2019/03/31/sop-on-bauxite-mining-unveiled-stop-work-order-still-in-force/

Earlier this year on March, the minister unveiled the SOP for the industry in order to regulate the mining activities.

One of the rules is

"Under these strict regulations, the minimum conditions for mining lease or proprietary mining lease application must be at least 20ha, whether it be an individual lot or a combination of neighbouring lots."

Now those small ah kao ahmad mutu kind of mining cannot go on already, hence it will be good for a regulated player like WZSATU.

The draft SOP is 174 pages long, and it encompasses the procedures in the five major networks in bauxite handling activities. They are application planning for mining rights, site management of bauxite mining and involves stockpile and port storage management.

Apart from that, it also involves transportation, enforcement and export procedures and all improvements made with various ministries, departments, and agencies.

News link on Draft SOP is here

Given the demand of bauxite from China to manufacture aluminium is so great, this will be a good news for WZSATU when the mining activities can start back 4Q of this year 2019. However, under the regulation, there will be a monthly total output of 600,000 tonnes of bauxite that can be exported.

The bauxite mining is one of the reason WZSATU share price went soaring high during 2015/2016 period towards a peak of RM 1.5 region. And the ban that lasted for 3 years sent WZSATU share price towards the lowly 24 cents region as of now.

When the mining activities resume, WZSATU will draw a good revenue from this operation, and the share price will definitely head up again.


2. ECRL work to restart on 25th July 2019. Local contractor participation up from 30% to 40%.

Beside the bauxite mining going to restart end of this year, the ECRL is also going to restart coming 25th July 2019. Source news ECRL to be relaunched 25 July 2019.

According to analyst, the ECRL work will benefit local player such as GBGAQRS, IJM, WCT, WZSATU, ECONPILE, ADVCON and SUNCON.
Source from The Star https://www.thestar.com.my/business/business-news/2019/04/15/ecrl-revival-bodes-well-for-local-construction-sector/

WZSATU have some experience in building rail project, hence got upper hand in getting ECRL related contract work.

3. Share price already bottom up, and showing sign of coming up back again

The share price dropped a lot from no income from mining activities and other cost overrun due to Variation Order from work in Pengerang and other contract work from IJM WEST COST EXPRESSWAY.

But the Variation Order will be billed back.

Now share price is almost at the bottom stage, and is looking for a come back.


Conclusion
Hence, you can study and look at WZSATU prospectus. Weight your option on short term lookout and long term look out. When Bauxite mining restart in 4Q 2019 this year, WZSATU will definitely be in the investor radar again. If invest now, then invest near base price. When good thing come in line, then price will be higher as usual.