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Still More Legs For Upside; Yet To See Full Positive Operating Leverage

PMetal could have achieved a much better earnings performance in 2Q21, if not for the uneventful incidents. Even so, 2Q21 recorded the highest earnings quantum ever and we expect much better quarters ahead. Besides systemic catalysts which are leading to favourable price and cost dynamics, the 42% additional smelting capacity would supercharge a 2-year net profit CAGR of +101% from 2020. A clearer roadmap of ESG sustainability is a boon. Maintain BUY. Target price: RM6.90.