The Johor Sand and Granite Lorry Operators' Association, which represents more than 100 operators, said it had no choice but to raise prices to avoid losses due to the high cost of diesel, which rose from RM2.15 to a record RM3.35 on Monday.

Even the tipper lorries have increased their prices. Will be a surprise if readymix concrete trucks did not follow suit. Lets keep an eye on q1'25 net profit :) May see some of the positive impact in q4'24 if Esceram increase the readymix concrete price within this month itself.

KUALA LUMPUR, June 14 — The price of goods in the construction sector has surged by nearly 30 per cent following the recent increase in diesel prices, said Datuk Azman Yusoff, president of the Bumiputera Contractors Association of Malaysia (PKBM). Speaking to Sinar Harian, Azman described the price hike as the highest in the country’s history, with suppliers setting new rates for construction materials since Monday.“The suppliers have also threatened to halt deliveries if the new price proposals are not adhered to,” he said. “We appeal to the Malaysian Construction Industry Development Board (CIDB) and the Ministry of Domestic Trade and Cost of Living (KPDN) to immediately monitor suppliers exploiting the diesel price change.”
Azman added that G1 to G7 contractors were among those most affected by the price increases. In Malaysia, contractors are classified into seven categories (G1 to G7) based on their financial capacity and ability to undertake projects of varying sizes and complexities. These categories are defined by the Construction Industry Development Board (CIDB) Malaysia.
He warned that construction costs will inevitably rise, potentially delaying project completions and causing substantial financial losses for contractors. “In addition, there has been an increase in the rental costs of machinery, such as heavy machinery, excavators, and pavers for infrastructure projects. “The price of raw materials, including ready-mixed concrete and other construction materials for building and road work, has also risen by 30%,” he added.
On Wednesday, Communications Minister Fahmi Fadzil cautioned businesses against raising prices just two days after the government floated retail diesel prices. He assured that authorities are closely monitoring the situation and promised swift action against companies attempting to profit from the subsidy rationalisation drive. Fahmi also mentioned public complaints that firms in the construction sector were among those exploiting the diesel subsidy rollback to increase prices.“After a check, we found that the construction sector never received any subsidies before, so there is no reason for them to hike up prices,” he stated.

Building material segment for Esceram is big :) As Is - 95% of the revenue from Esceram is derived from Evermix readymixed concrete. We will know whether higher ASP will improve the net profit of Esceram come Q1'25. On top of that, construction activities continued to be strong - civil structure works, residential and non-residential.

The glove makers ASP are very sensitive to natural gas and electricity tariffs impacting their margins. Nitrile gloves inventories manufactured in 2020/2021 will start to expire next year; 5 years shelf life. We should see production to pick up gradually for the big 4 four glove makers. Demand and ASP will determine the pace of ramp up for the big 4 glove makers.

10M is a big ask leh. But it is possible now with the ready mixed concrete price increase + increased construction activities. No idea what is driving the recent market force churning. Could be the anticipation of post diesel hike or the new shareholders on board with the consideration shares? Its beyond our circle of influence and we can only manage our own positions.

yup. existing esceram mgmt believes that esceram share price is undervalued and allocated payment of a portion of the acquisition price with the consideration shares at 0.32 cents. And Evermix agreed with the deal. We will know in the future whether 0.32 is indeed the fair value of Esceram :)

KUALA LUMPUR (June 19): Top Glove Corp Bhd (KL:TOPGLOV) has returned to the black in its third financial quarter ended May 31, 2024 (3QFY2024), after posting losses for the last seven consecutive quarters, primarily driven by stronger glove demand as customers replenished their glove inventories having cleared excess stocks.

Customers will continue to replenish their inventories as we marches towards next year where the nitrile gloves manufactured in 2020 will be expired followed by those manufactured in 2021. These two manufacturing years are probably the ones causing the excess stocks in the market :) latex has expired and being replenished accordingly as it has shorter shelf life.

Above link is showing the construction statistics. Evermix ready mix concrete is supplied to 3 major groups - residential (>60%), commercial (>20%) and civil / infrastructure (10%). Looking at the statistics, demand for its concrete should be good. The key point here is still the ASP that will help to increase its margins.

[Extracted from AR2023 page 11; Operation Review for Building Material]: We continued to shift our sales mix from infrastructure and high-rise residential projects to industrial development and landed residential projects to better manage our business risk portfolio and also realignment of customers mix to reduce credit risk. The cement price hikes during the period under review had greatly impacted our margins, however we managed to pass down the cost increase to the end users, amidst strong protests.

Depends when and how much is the adjustment of selling price for their ready mixed concrete. OPC is going up, sand and aggregates too. Coupled with diesel hike. If adjustment has been done in June, we should see improved margin for building materials.

Agree with sws lss. This year probably nothing, no movement. QR has to be really good first and consistent and must have catalyst. As you can see from many QR result, it is fantastic but no movement on price. It need to have major catalyst or free warrant to go to 0.30.

Market force are done with churning at the moment. Construction activities continues to pick up (both public and private sectors). Current quarter performance is the final qr to wrap up the profit guarantee terms for acquisition of Evermix; met the requirements if you will.

From 0.325 to 0.175 only happened last year. So just patient wait for 0.300. Agree with cheng, if next two quarter cannot earn much profit that means this counter is shit. Glove counter recovering and cement sector should be very good. If this company still not make more than 10M per quarter then can say bye bye shitty counter. :)

if big companies like mcement and humeind supply to hsr and others big infrastructure projects. Then who is going to supply those private and residential projects? Which means it will benefit the small cap of cement companies like ice cream.

not exactly cement but uses cement (OPC), sand and aggregates to produce concrete, sam. And yes, they are supplying ready mixed concrete to residential, non residential and civil structure projects. Adjustment to ASP will increase the margins as building material is Esceram's major revenue now ~95%.