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HIAP HUAT HOLDINGS BHD (HHHCORP, 0160) – The leading in oil recycling service industry in malaysia

HHHCORP is the primary player in producing recycled products from waste oil, waste solvents and used drums/containers collected.
Hiap Huat is licenced by the Department of Environment (DoE) to collect, treat, and process waste oil, waste solvents, used drums and containers. As a scheduled waste recycler, the company is involved in collecting, recycling, re-refining, and producing recycled products. HHHCORP is the ONLY company which accredited with full wide range under DOE and recognized International Sustainability Carbon Certificate

  1. HHHCORP’s business partner is PETRONAS CHEMICAL
To note, Hiap Huat sources waste oil from more than 2,000 points of collection, ranging from small car workshops to multinational corporations such as BASF Petronas Chemical Sdn Bhd that supplies approximately 16 per cent of its total input.
In other words, PETRONAS CHEMICAL is the business partner for HHHCORP.
Refer to the interview’s link above, HHHCORP’s director clearly mentioned that one of the company's clients is Petronas. Petronas has a high demand for oil waste recycle management and industrial waste. Since HHHCORP can obtain Petronas’s trust, it means that the company has a certain operating capacity with Oil and gas companies and have a certain advantage in the disposal of waste materials.
  1. The leading player in oil waste management
HHHCORP has established track record and reputation and the leading player in oil waste management
At this point of time, there are approximately 40 players in the industry, and the top player in the oil waste management is HHHCORP.
Because there is so much competition, HHHCORP manage to distinguish from the rest and at the optimum position to further boost their position.
3. Aiming for bigger market
On last 30 December 2019, HHHCORP bought 4.10 acres of leasehold land in Pulau Indah Industrial Park for RM11.97 million to build a new waste treatment plant.
The treatment plant, expected to produce about 30,000 tonnes of recycled base oil per annum, is to be operated by Hiap Huat unit Topmark Petroleum Sdn Bhd. Its two other plants are in Bentong, Pahang and Gopeng, Perak. All three have a total handling capacity of 61 million litres of waste oil.
With this new treatment plant, it will increase HHHCORP’s exports to 30% to 40%. And it will be distributing the products to the buyers directly.
With this new plant also, the company will increase its market share of the recycled oil market in Malaysia in the near future. Which means HHHCORP will strengthen their position as a leading player in oil waste management.
4. Technical ‘s view

Based on  the technical’s view, HHHCORP make a strong breakout at .105
This breakout accompanied by higher volume which shows the greater buying interest to push the price higher.

Considering all the above, I opine that current price for HHHCORP is attractive due to below:
1) HHHCORP’s business partner is PETRONAS CHEMICAL
2) The leading player in oil waste management
3) Aiming for bigger market

Disclaimer : The above opinion is never intended to be a BUY CALL whatsoever. I am sharing my observations ONLY based on fundamental; past history; current trading pattern; charts etc. Please make your own informed decision before buying this share or whatever share for that matter.

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