China Steel Makers Down On Tax Rebate Concerns2007-6-14 11:17:00
China steel makers down after State Council says it will adjust some export tax rebates; "such comments intensified concerns that the government will cut tax rebates on steel exports soon," says analyst at Hengtai Securities; notes there have been rumors for a while that China will cut or revoke tax rebates on some metal exports. Baoshan Iron & Steel (600019.SH) last down 3.0% at CNY11.54, Wuhan Iron & Steel (600005.SH) down 2.9% at CNY11.47, Laiwu Steel (600102.SH) off 2.9% at CNY18.90; trading moderate. Analysts remain positive on outlook for steel shares, which may benefit from urbanization process of China; also steel shares look cheap at 15-20X earnings, vs around 40X for overall market. "There may be a good chance to pick up some good names if steel shares fall sharply.
Malaysia's steel counters are trading below 10X 07PE. I prefor OrnaSteel, Hiaptek and Masteel.
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