Daily Brief Energy/Materials: Asian Paints, Crude Oil, Exxon Mobil, Algoma Steel Group, Petroleo Brasileiro , Geo Energy Resources, SGX Rubber Future TSR20, Sable Offshore, Iron Ore and more

• The paint industry experienced significant challenges in Q2FY24, with most companies reporting subdued performance.
• Asian Paints reported typical fluctuations in market share of 1-1.5%, while Berger Paints and AkzoNobel both reported gains in their respective market positions.
• Asian Paints’ current market share reduction and increased competitive pressure stem from its size and the slowing macro environment.

• The US oil and gas rig count remained unchanged at 589 for the week ending on 13/Dec, after rising by seven the previous week.
• For the week ending 06/Dec, US oil production rose to a new high of 13.63m bpd from 13.50m bpd the week prior.
• The number of active US oil rigs was steady at 482, while the US gas rig count rose by one to 103.

• In a recent special call arranged by the management, Exxon Mobil has unveiled an ambitious strategy that could reshape its future and redefine its standing in the energy sector.
• Despite concerns about falling oil prices and industry-wide cautious spending, Exxon is doubling down on capital-intensive projects while expanding into emerging markets like carbon capture, hydrogen production, and advanced battery materials.
• The company’s bold moves include acquiring Pioneer Natural Resources for $60 billion, ramping up investments in the Permian Basin, and launching data-center-specific natural gas projects equipped with carbon capture technology.

• Algoma Central Corporation operates in three main segments: Inland Shipping, Ocean Shipping, and Product Tankers
• Inland Shipping serves customers in industries such as steel, cement, agriculture, and construction
• Algoma’s diversified operations in shipping make it an attractive investment opportunity for smaller accounts looking for undervalued stocks with growth potential

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• WTI futures rose 6.1% for the week ending 13/Dec, driven by China’s policy easing plans and supply concerns from sanctions on Russia and Iran.
• WTI options Put/Call volume ratio fell 1.15 from 1.24 (06/Dec) last week, as call volume rose by 21.7% WoW while put volume increased by 12.6%.  
• WTI OI PCR fell to 0.85 from 0.88 last week. Call OI rose by 7.0% WoW, while put OI increased by 3.3%.

• Petrobras ADR (PBR) is a long-term investment opportunity for patient income-driven investors
• Petrobras is one of the world’s largest oil companies with a market capitalization of $89 billion and total hydrocarbon production of 2.8MMbpd
• Despite facing challenges over the past 20 years, including the Car Wash scandal, Petrobras has implemented changes and reforms, making it a potentially attractive investment for the future

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• We examine Geo Energy Resources (GERL SP), an Indonesian coal producer listed in Singapore, which has an opportunity to grow production/profitability by 150%/500% in two years. 
• For FY25, based on our assumptions (50 USD/ton coal price, ten million ton sales), the stock trades at 5x PE,3.7x EV-EBITDA, and a 6% dividend yield (30% payout ratio). 
• Subject to execution on the new TRA mine, we will see 25 mnt sales in FY27/28, resulting in 1.3x PE and >30% dividend yield (assuming a higher payout of 40%). 

• January-October 2024 exports yield US$2.54 billion, up 17% YoY
• 405% rise in value YoY in exports to Malaysia during Jan-Oct 2024
• Michelin plans to source rice husks from Vietnam for tire-making

• SOC lacks the necessary permits to begin production by the end of 2024 after the California Coastal Commission held its final meeting of the year.  
• SOC has been guiding for Q4 2024 as the start date of its operations. We do not believe this possibility exists with approximately two weeks left in the year. 
• SOC has experienced meaningful setbacks that are likely to lead to a long process of nothing occurring.

• Price Movements: SGX Iron Ore Futures rose $1.95/ton last week, peaking at $107.30/ton but faced increased resistance and waning momentum in the later part of the week. 
• Economic Influence: Expanded Chinese stimulus initially boosted prices, but weak CPI and loan data revealed sustained economic headwinds, dampening a lasting rally.
• Technical Indicators: A flat-top pattern, narrowing MACD, and declining RSI point to bearish potential.