OMH to benefit from continued China's growth

China industrial profits continued to grow robustly in November for a seven month of gains, as manufacturer continue their recovery from COVID downturn. Industrial profits are expected to
maintain double digit growth over the next few months, driven by Low base effects, domestic economic recovery, improvements in overseas demand and rebound in commodity prices benefiting the upstream sector.

FeSi Alloy prices has seen its recovery US$1,000 to US$1,350 +++ and expected to be sustained due to the following factors:
- China and global economic recovery to drive demand going into 2021/22
- China restriction on supply due to environmental concern and enforcement. the environmental policy will be tightened going forward.

The current share price and the increase in share price is reminiscent of the situation that OMH was in in mid 2017. As the FeSi recovered in mid2017-end2018, we also saw the OMH share price's staggering growth from $0.2 to a high of $1.70 in just slightly more than 1 year.
I believe this time is no different, and we would expect the share price to recover at a faster pace to hit $1.70 or higher.

Again OMH share price can be sustained at >$2-3 based on:
- At current alloy prices, it would not be difficult for OMH to attain net profit of A$100m or more
- current Low forward PE of only 3.6x, compared to its peers (PressMetal 72x). Even if trading at $2, OMH forward PE would only be ~15x
- Increase in shareholder base and new investors interest generated from the upcoming Bursa listing
- rotation play into commodity/industrial material sector currently underway as more fund managers allocate more investments into this sector. Goldman Sach bullish on commodity going into 2021 will help to drive more investments into this sector too.
- The recent approved US stimulus of US$900b should help to sustain the bullish sentiment for stock market, in particular the commodity sector.