MYCRON STEEL BERHAD A MELEWAR STEEL COMPANY

1. Corporate Information

2. Operations

3. Financials

4. Business Outlook

PRESENTATION CONTENTS

N o . S h a r e s S h a r eS h a r e h o l d e r s ( M i l l i o n ) h o l d i n g

M e l e w a r I n d u s t r i a l G r o u p B h d 9 7 . 5 0 5 4 . 5 %

M e l e w a r E q u i t i e s ( B V I ) L t d 9 . 3 4 5 . 2 %

M a l a y s i a n A s s u r a n c e A l l i a n c e B h d 5 . 5 0 3 . 1 %

P e r m o d a l a n N a s i o n a l B h d 5 . 4 5 3 . 0 %

E m p l o y e e s P r o v i d e n t F u n d B o a r d 5 . 4 5 3 . 0 %

T o t a l B u m i p u t r a & G o v e r n m e n t 1 2 3 . 2 4 6 8 . 8 %

F r e e F l o a t 5 5 . 7 6 3 1 . 2 %

T o t a l P a i d U p C a p i t a l 1 7 9 . 0 0 1 0 0 . 0 %

2 5 J u l y 2 0 0 6

MAJOR SHAREHOLDERS

BOARD OF DIRECTORS

Seated from left to rightTunku Dato’ Ya’acob bin Tunku Abdullah(Non-Independent Non-Executive Director)

Tunku Dato’ Seri Iskandar bin Tunku Abdullah(Non-Independent Non-Executive Chairman)

Azlan bin Abdullah(Executive Director / Chief Executive Officer)

Lim Kim Chuan(Non-Independent Non-Executive Director)

Standing from left to rightChan Sang Whye(Executive Director / Chief Operating Officer)

Dato’ Zulkifly @ Sofi bin Haji Mustapha(Non-Independent Non-Executive Director)

Dato’ Abu Talib bin Mohamed(Independent Non-Executive Director)

Dato’ Narendrakumar Jasani a/l Chunilai Rugnath(Independent Non-Executive Director)

Paul Chan Wan Siew(Independent Non-Executive Director)

Azlan bin AbdullahChief Executive Officer

Education : • BSc (Buss Admin) -Trinity Univ, USA• MBA – Morehead State Univ, USAExperience : • 13 years in senior banking positions with

Citibank, UAB & BOC• 7 years as MD of Precision equipment manufacturer• 4 years in steel industry

Chan Sang WhyeChief Operating Officer

Education :• Fellow – ACCA, UK• Fellow – ICSA, UKExperience : • 10 years Public & Internal Auditing• 20 years Steel Industry Operations

Wong Yeap MinChief Financial Officer

Education :• Fellow - CIMA, UK• Fellow - ACCA,UKExperience : • 8 years KPMG, 10 years Financial Mgt• 12 years Corporate Planning & General Mgt

MANAGEMENT STAFF

OPERATIONS

• Mycron Steel Berhad was listed on Bursa Malaysia in June 2004.

• Core activity is the production of Cold Rolled Coil (CRC) steel sheets (through 100% owned Mycron Steel CRC Sdn Bhd).

• Mycron Steel CRC Sdn Bhdstarted production in June 1990.

• First CRC manufacturer in Malaysia.

• Attained SIRIM ISO 9001 in 1996.

COMPANY BACKGROUND

• Manufacturer of highest quality Malaysian CRC.

Production Facilities Location : Lot 717, Jalan Sungai Rasau, Section 16, 40200 Shah Alam, Selangor

Continuous Pickling LineHitachi 6-High Cold Reduction MillElectrolytic Cleaning LineBatch Annealing FurnaceRecoiling Line

Land : 781,423 sq.ft. (17.94 acres)Built-up area : 307,507 sq.ft.Production Capacity : 15,000 mt per month

180,000 mt per annum

Cold Rolled Coil Factory, Shah Alam

HOT ROLLED COILS

Thick Steel Sheet (1.7 to 3.5mm)

COLD ROLLED COILS

Thin Steel Sheet (0.3 to 2.5mm)

WHAT DOES MYCRON DO?

APPLICATIONS OF COLD ROLLED COIL SHEETS

Electrical components

Pipes/Tubes

Steel Drums for Palm Oil & Petroleum

Home Furniture

Vehicle bodies

Office Furniture

Consumer Goods

COLD ROLLED COIL DIVISION - CUSTOMERSS t e e l S t r a p p i n g s

1 , 7 4 8 M T 6 %S t e e l G a l v a n i s i n g

4 7 M T 0 . 0 2 %F u r n i t u r e M a n u f a c t u r e r s

1 , 1 7 9 M T 4 %

P i p e M a n u f a c t u r e r s

M Y C R O N S T E E L 3 , 9 0 3 M T 1 3 %

C a p a c i t y : 4 5 , 0 0 0 M T / Q 1 2 0 0 6 F u r n i t u r e & E l e c t r i c a lC u r r e n t P r o d u c t i o n :

2 9 , 5 0 2 M T / Q 1 2 0 0 6 M e l e w a r I n d u s t r i a l G r o u p B h dC a p a c i t y U t i l i s a t i o n : 6 6 % 5 , 3 9 3 M T 1 8 %

S t e e l C e n t e r s1 0 , 0 6 9 M T 3 4 %

A u t o & E l e c t r i c a lD r u m P a l m O i l , P e t r o l e u m

5 , 6 9 4 M T 1 9 %

O t h e r s1 , 4 6 9 M T 5 %

N.B. Unlike long-product steel manufacturers, Mycronhas ZERO exposure to the domestic construction sector.

Manufacturing Cost Structure % CostRaw Materials - Hot Rolled Coil (HRC) 87%Manufacturing & Overheads Cost 12%Transportation Cost (Domestic) 1%

Manufacturing & Delivery Cost 100%• HRC constitutes 87% of total production cost.

• 40% HRC purchased from MegaSteel because of import restrictions imposed by MITI. MegaSteel HRC is lower grade quality (i.e. made from scrap steel).

• 60% HRC imported from JFE, Japan. Imported HRC is higher quality (i.e. made directly from smelted iron ore).

• MegaSteel’s HRC prices (to CRC manufacturers) are now generally in line with international prices. Used to cost substantially more.

• Currently 100% of CRC output is sold in Malaysia.

RAW MATERIAL SUPPLIERS

Cold Roll Mill

HRCCRC

3. Steel HRC sheets are passed through the Cold Roll Mill (CRM) rollers that squeezes the steel into thinner sheets (CRC) under high pressure.

This process is repeated until the appropriate thickness is attained.

1. Steel sheet raw materials are delivered in the form of Hot Rolled Coils (HRC).

CRC MANUFACTURING PROCESS

2. Steel sheets are cleaned by passing through a Continuous Pickling Line (Acid Cleaning).

Cold Roll Mill (Skin Pass Process)

Rough CRC Smooth CRC

4. The CRC are cleaned in an ECL (Electrolytic Cleaning Line) depending on customer needs.

They are then stacked on top of one another in the Batch Annealing Furnace, and for several days, are heated to return the mechanical properties back to the stressed steel.

5.The CRC is then passed through the Cold Roll Mill (CRM) again, to even out any warps in the steel (SkinpassProcess).

CRC MANUFACTURING PROCESS

6. The CRC are oiled, recoiled and sealed for rust protection, for delivery to customers.

Batch Annealing Furnace

HOT ROLLED COILS (FROM SUPPLIERS) CONTINUOUS PICKLING LINE - ENTRY

CONTINUOUS PICKLING LINE - EXIT COLD REDUCTION MILL (Sheet compression)

ELECTROLYTIC CLEANING LINE H2 ANNEALING FURNACES (Loading)

H2 ANNEALING FURNACES (Heating) COLD REDUCTION MILL (Skinpass Process)

ELECTROSTATIC OIL COATER RECOILING LINE – Exit Tension Reel

PACKING CRC FINISHED GOODS STORE

FINANCIALS

CRC & HRC INTERNATIONAL PRICE

0

100

200

300

400

500

600

700

800

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

US$

/ M

T

CRC

HRC

Spread

STEEL PRICE CHART

Since 2002 prices increased sharply due to demand surge by China and weakening US$.

Since mid-2005 prices corrected substantially (-US$ 170/MT) as China became steel exporter.

Over this 10 yr period, the HRC and CRC Spread, remained stable at ≈US$ 100 /MT.

Asian financial

crisis

Whilst HRC manufacturers’ margins are affected by market price fluctuations, CRC manufacturers’ margins are very stable.

HRC price movements are always passed on to customers.

FINANCIAL CHARTS

MYCRON SALES, PBT & PAT

-50

0

50

100

150

200

250

300

350

400

RM

mil

Sales 203 192 204 160 197 182 160 201 270 357 325

PBT 15 12 15 4 37 30 19 34 33 36 -15.5

PAT 15 12 15 4 37 30 38 24 24 26 -12.2

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Sharp increase in sales caused by sharp rise in price of CRC.

Tax charge = Nil up to FY 2001

Profits are very stable (Avg PAT : RM 30mil)

Profits affected by inventory

loss (FY 2006)

2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6 Q 1 2 0 0 7R M '0 0 0 R M '0 0 0 R M '0 0 0 R M '0 0 0 R M '0 0 0

G r o s s R e v e n u e 2 0 1 , 0 8 5 2 6 9 , 5 7 7 3 5 7 , 2 8 4 3 2 5 , 4 6 1 4 3 , 3 8 2

C o s t o f S a l e s ( 1 6 2 , 7 4 3 ) ( 2 3 1 , 9 7 8 ) ( 3 0 9 , 8 7 7 ) ( 3 3 0 , 9 6 3 ) ( 3 8 , 7 6 0 )

G r o s s P r o f i t 3 8 , 3 4 2 3 7 , 5 9 9 4 7 , 4 0 7 ( 5 , 5 0 2 ) 4 , 6 2 2 O t h e r I n c o m e 1 , 2 2 6 7 9 6 6 7 2 3 4 9 1 6 0 D i s t r i b u t i o n C o s t ( 2 , 6 8 2 ) ( 1 , 8 9 3 ) ( 1 , 7 7 7 ) ( 1 , 3 4 8 ) ( 2 6 7 )

A d m i n C o s t ( 2 , 9 9 2 ) ( 1 , 9 5 0 ) ( 8 , 7 2 0 ) ( 5 , 9 1 7 ) ( 6 8 8 )

F i n a n c e C o s t - ( 1 , 8 9 5 ) ( 1 , 9 1 4 ) ( 3 , 1 4 1 ) ( 4 3 8 ) O t h e r E x p e n s e s - - - - ( 6 8 )

P r o f i t B e f o r e T a x 3 3 , 8 9 4 3 2 , 6 5 7 3 5 , 6 6 8 ( 1 5 , 5 5 9 ) 3 , 3 2 1 T a x ( 9 , 9 4 9 ) ( 9 , 0 7 9 ) ( 9 , 5 4 4 ) 3 , 3 5 9 9 4 0

P r o f i t A f t e r T a x 2 3 , 9 4 5 2 3 , 5 7 8 2 6 , 1 2 4 ( 1 2 , 2 0 0 ) 2 , 3 8 1

I N C O M E S T A T E M E N T

y / e 3 1 J a n u a r y

♥ Gross Revenue has grown strongly with the increase in HRC prices.Mycron has passed on the price increase of raw materials to customers.

PBT has been strong for the past 3 years (avg. RM 34 mil /year).♣ PBT loss of RM 15.6 mil was due to the write down in inventory values following

the fall in international HRC prices. Mycron has reduce HRC cost to US$ 445 /MT. This loss is a one-time loss if HRC prices stabilise at this level.

♣

♥

Ω Since mid-2005 (FY 2006), HRC & CRC prices have fallen.

Ω

2003 2004 2005 2006RM'000 RM'000 RM'000 RM'000

Fixed Assets 128,304 126,879 127,491 185,334

Deferred Tax Asset 7,874 0 0 4,700

Deferred Tax Liabilities 0 (1,007) (8,802) (20,010)

Current Assets 108,261 90,247 152,191 139,814

Current Liabilities (9,889) (79,917) (48,704) (81,817)

Net Current Assets 98,372 10,330 103,487 57,997

NET ASSETS 234,550 136,202 222,176 228,021

Share capital 60,000 60,000 179,000 179,000 Share Premium Account 14,919 14,919 Revaluation Reserve 30,575 Retained Profits 174,550 76,202 28,257 3,527

SHAREHOLDER FUNDS 234,550 136,202 222,176 228,021

BALANCE SHEET 31 January

♥ Mycron has adopted international Financial Reporting Standards (FRS) for FY 2006, and this has resulted in an fixed asset revaluation surplus of RM 30.6mil.

♥

Drop in Current Assets due to write-down in value of inventories.

OPERATING MARGINS

2002 2003 2004 2005 2006 Avg.2002-05RM mil RM mil RM mil RM mil RM mil RM mil

Sales 160.2 201.1 269.6 357.3 325.4 247.0Operating Cost 131.2 158.0 226.0 308.2 311.7 205.8

EBITDA 29.0 43.1 43.6 49.2 13.7 41.2

TONNAGE ('000 MT) 121.4 142.2 154.1 154.5 118.2 143.1

Capacity Utilisation 67% 79% 86% 86% 66% 79%

Op.Cost (RM /MT) 1,081 1,111 1,466 1,994 2,637 1,413

EBITDA (RM /MT) 239 303 283 318 116 286EBITDA / Sales 18.1% 21.4% 16.2% 13.8% 4.2% 17.4%

y/e 31 January

♥

♣

♦

♥ Lower margin per tonne (RM 116 /MT) due to Cost of Sales at historic price. With write-down in values of inventories at year-end, FY 2007 margins will better reflect operating profitability (should be similar to pre-2006 margins).

♣ Drop in sales tonnage due to customers with-holding orders to reduce inventories, in anticipation of further CRC price falls in 2005. Customers inventory levels are at minimum levels, and orders have picked-up since Q1 2006.

♦ If no major HRC price movements, profits for FY 2007 will return to pre-2006 levels. Average EBITDA = 286 RM /MT.

DIVIDEND POLICY

20% 20% 20% 20%

180%

7%0%

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

2000 2001 2002 2003 2004 2005 2006

(%) DIVIDEND PAID

Dividend Policy

Payout Ratio =

25% PAT

Pre-IPO payout

BUSINESS OUTLOOK

STEEL CONSUMPTION (Long & Flat Products)

• Malaysia consumes 329 kg of steel per capita annually.• As Malaysia’s development continues, demand for steel will grow.• MISIF forecasts long-term demand growth of 6.0% per year.

25 38 70

197

329

773

965 974

0100200300400500600700800900

1000

kg

Per Capita Steel Consumption - kg/per annum

INDONESIA

PHILIPPINES

VIETNAM

THAILAND

MALAYSIA

SINGAPORE

TAIWAN

KOREA

Source : MISIF 2004

Mal

aysi

a

Sing

apor

e

Taiw

an

Kor

ea

ThaiVietPhilIndo

The Future for Malaysian Steel is Bright.

DOMESTIC MARKETMT/year MT/month

Mycron 12% 116,658 9,722 OrnaSteel 27% 259,200 21,600 MegaSteel 1% 10,000 833

40% 385,858 32,155 Imports 60% 574,142 47,845

100% 960,000 80,000

Estimated TonnageMarket Share

♠MegaSteel Started production Q1 2006Announced Capacity : 1,300,000 MT/yearExpected Max. Production : 480,000 MT/yearOutput Quality : Low-end CRC. Focused on pipe / tube use.

Made from own HRC (scrap based steel)

♠Although AP’s are

restricted, Malaysia imports 60% of its CRC needs (mostly high-end quality steel).

MYCRON STRATEGYMycron already producer of high-end quality CRC (for drum, electrical, auto component quality). Will move further up-market (i.e. auto bodies, roofing, etc) using higher quality imported HRC, via upgraded facility (ready by end-2007).

♥Mycron supplies 1/3rd of Malaysia’s domestic CRC needs (OrnaSteel 2/3rd).

♥

MegaSteel (with support from OrnaSteel & Mycron) is lobbying MITI to protect the domestic CRC market, by further restricting CRC imports.

HRC is a protected market in Malaysia. CRC will be protected too.

• Capacity increases from 180,000 MT/yr to 260,000 MT/yr (+ 80,000 MT /yr) or +45%

• Embarking on plant upgrade and expansion. Capex: RM 120m.

• Installation of new facilities –Tension Leveller, Skinpass Mill and additional Annealing equipment. Completion: End 2007.

• Upgrade will raise quality of high-end CRC (=better margins).

2002 2003 2004 2005 2006TONNAGE ('000 MT) 121.4 142.2 154.1 154.5 118.2

EBITDA (RM mil) 29.0 43.1 43.6 49.2 13.7

EBITDA (RM /MT) 239 303 283 318 116

Average EBITDA 2002-2005 (RM /MT) 286Avg Op.Cost (RM /MT) 1,413 Savings 4.0% 57EBITDA Plant Upgrade (RM /MT) 342

Plant Upgrade Additional Tonnage (MT /year) 80,000

EBITDA Plant Upgrade (RM mil /year) 27.4 4.4

PAT after Depn. Interest & Tax (RM mil /year) 16.6 7.2

y/e 31 JanuaryUPGRADE P&L

Payback (yrs)

PLANT UPGRADE & EXPANSION

• Profit After Tax increase due to the plant upgrade & expansion is estimated to beRM 16.6 mil /yr

• Mycron purchased 20% in PMP Galvanizers Sdn Bhd.

• PMP is subsidiary of Multi Resources Holdings Sdn Bhd, (in Kuching, Sarawak) which manufactures roofing products like roofing truss, colour coating and roofing profiles, for export to Australia, New Zealand, Middle East and South East Asia.

• PMP is in the midst of installing a RM85 million CRC galvanising plant (Capacity = 150,000 MT/year).

• Expected to be commissioned by August 2006.

• PMP has signed an off-take agreement to buy up to 75,000 MT/year of CRC upon completion of Mycron’s plant upgrade and expansion (Expanded Plant capacity= 80,000 MT/yr).

• Win-win for both :

PMP has a regular supply of high quality CRC.

Mycron is guaranteed an off-take for the added capacity.

INVESTMENT IN PMP GALVANIZERS SDN BHD

• Signed in April 2006.

• JFE to provide technical assistance in producing thin-gauge CRC (<0.3mm).

• To enable Mycron to penetrate the roofing and auto industries.

• Involves secondment of JFE technical staff to Mycron and training of Mycron’s technical staff in Japan.

TECHNICAL SERVICE AGREEMENT WITH JFE JAPAN

SHARE VALUATION

• Mycron share price has performed poorly compared to the CI.

Fall in HRC prices.

Poor construction sector performance negative out-look for steel sector.

Post IPO stock over-hang after MIG 1:4 distribution in-specie of Mycron shares.

• Reason :

VALUATION OF LISTED STEEL COMPANIES

C o m p a n i e s S h a r e P E( a s a t 2 5 / 0 7 / 0 6 ) P r i c e R a t i o

R M p s

A n n J o o R e s o u r c e s 1 . 1 1 1 6 . 9

A IS B 0 . 6 0 1 4 . 3

C h o o B e e M e t a l 1 . 6 1 1 0 . 1

F A C B In d 0 . 4 9 5 3 . 0

H i a p T e c k 0 . 8 0 6 . 9

M a l a y a w a t a 1 . 2 4 -

S o u t h e r n S t e e l 1 . 0 5 -

M y c r o n S t e e l 0 . 7 2 5 -A V E R A G E 1 0 . 2

The PE ratio for listed steel companies is relatively low at 12x compared to the Industrial Sector PE of 14x or overall market (EMAS) PE of 17x.

Valuations are slightly down because of fall in HRC prices (one-time effect).

But main share price suppression caused by the slow down in the domestic construction sector.

Under 9th Malaysia Plan construction industry will eventually pick-up.

PE for steel sector should eventually go above 12x.

M Y C R O N E x p a n s i o nS T E E L 2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6 P r o f i tP R O F I T S R M m i l R M m i l R M m i l R M m i l R M m i l

P r o f i t A f t e r T a x 2 3 . 9 2 3 . 6 2 6 . 1 - 1 2 . 2 1 6 . 6

2 4 . 5A v e r a g e P A T ( m a i n t a i n a b l e ) 2 4 . 5 4 1 . 1

P a i d U p C a p i t a l ( m i l s h a r e s ) 1 7 9 1 7 9E P S ( m a i n t a i n a b l e ) 0 . 1 3 7 0 . 2 3 0

R M p s P E R R M p s R M p s4 . 4 0 . 6 0 1 . 0 1

M a r k e t p r i c e 0 . 7 1 5 . 2 0 . 7 1 1 . 1 95 . 8 0 . 8 0 1 . 3 47 . 3 1 . 0 0 1 . 6 88 . 0 1 . 1 0 1 . 8 4

N T A v a l u e 1 . 2 7 9 .3 1 .2 7 2 . 1 39 . 5 1 . 3 0 2 . 1 8

I P O p r i c e 1 .4 0 1 0 .2 1 .4 0 2 . 3 51 0 . 9 1 . 5 0 2 . 5 1

S t e e l I n d u s t r y ( P E 1 2 x ) 1 2 .0 1 .6 5 2 . 7 71 2 . 4 1 . 7 0 2 . 8 51 3 . 1 1 . 8 0 3 . 0 2

I n d u s t r i a l S e c t o r ( P E 1 4 x ) 1 3 .9 1 .9 0 3 .1 81 4 . 6 2 . 0 0 3 . 3 51 5 . 3 2 . 1 0 3 . 5 21 6 . 0 2 . 2 0 3 . 6 9

E M A S I n d e x V a l u a t i o n ( P E 1 7 x ) 1 6 .8 2 .3 0 3 . 8 61 7 . 5 2 . 4 0 4 . 0 2

y / e 3 1 J a n u a r y

+

=O n e - t i m e i n v e n t o r y

l o s s

M Y C R O NS T E E L 2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6P R O F I T S R M m i l R M m i l R M m i l R M m i l

P r o f i t A f t e r T a x 2 3 . 9 2 3 . 6 2 6 . 1 - 1 2 . 2

A v e r a g e P A T ( m a i n t a i n a b l e ) 2 4 . 5

P a i d U p C a p i t a l ( m i l s h a r e s ) 1 7 9E P S ( m a i n t a i n a b l e ) 0 . 1 3 7

R M p s P E R R M p s4 . 4 0 . 6 0

M a r k e t p r i c e 0 . 7 1 5 . 2 0 . 7 15 . 8 0 . 8 07 . 3 1 . 0 08 . 0 1 . 1 0

N T A v a l u e 1 . 2 7 9 .3 1 .2 79 . 5 1 . 3 0

I P O p r i c e 1 .4 0 1 0 .2 1 .4 01 0 . 9 1 . 5 0

S t e e l I n d u s t r y ( P E 1 2 x ) 1 2 .0 1 .6 51 2 . 4 1 . 7 01 3 . 1 1 . 8 0

I n d u s t r i a l S e c t o r ( P E 1 4 x ) 1 3 .9 1 .9 01 4 . 6 2 . 0 01 5 . 3 2 . 1 01 6 . 0 2 . 2 0

E M A S I n d e x V a l u a t i o n ( P E 1 7 x ) 1 6 .8 2 .3 01 7 . 5 2 . 4 0

y / e 3 1 J a n u a r y

O n e - t i m e i n v e n t o r y

l o s s

Value of Mycron SharesSteel companies are affected by the slow down in the domestic construction sector & have low PE ratios.

Mycron has a PE ratio lower than the steel industry.

But Mycron has ZERO exposure to the construction sector.

Apart from the one-time FY2006 loss, profits should remain stable (as pre-2006) for the flat steel sector.

Mycron supplies to the electronic, auto, palm oil, petroleum & furniture industries.

Mycron’s valuation should be similar to that of these industries.

Mycron’s PE should be at least 14x.

Mycron’s fair value : RM 1.90 ps to RM 3.18psMycron is worth much more than current market price.

E x p a n s i o nP r o f i t

R M m i l

1 6 . 6

2 4 . 54 1 . 1

1 7 90 . 2 3 0

R M p s1 . 0 11 . 1 91 . 3 41 . 6 81 . 8 42 . 1 32 . 1 82 . 3 52 . 5 12 . 7 72 . 8 53 . 0 2

3 .1 83 . 3 53 . 5 23 . 6 93 . 8 64 . 0 2

+

=

SUMMARY

• Mycron has been profitable since it started operations in 1990.

• Mycron is manufacturer of highest grade CRC in Malaysia.

• Malaysia imports 60% of its CRC needs.

• International market price for HRC has been volatile. But spreadbetween CRC & HRC has always been stable (≈ US$ 100 /MT).

• CRC manufacturers always pass through HRC price changes to its customers. The profit margin for CRC manufacturers is stable.

• In Malaysia, the spread between HRC and CRC is also very healthy (> US$ 100 /MT).

SUMMARY

• Mycron’s 15 year client relations (1st M’sian manufacturer).

• Mycron’s premium high-end CRC steel output.

• Mycron’s strong reputation for quality.

• Mycron enjoys good CRC:HRC spreads, because of:

• MegaSteel entering CRC market with low-end quality steel.

• Mycron is focused on high-end CRC steel.

• Mycron is upgrading facility to produce even higher-qualityCRC. Expansion completion : end-2007.

• Upgraded facility will also increase capacity by 45% (=80,000 MT /year).

• PMP Galvanisers Sdn Bhd has signed off-take agreement for 75,000 MT/year of the additional CRC.

• The additional 80,000 MT/year capacity, will contribute RM 27.4 mil EBITDA or RM 16.6 mil PAT.

• This represents a Substantial Increase in Profit After Tax, and should be a RE-RATING FACTOR for Mycron.

SUMMARY

• Mycron’s share price (at RM 0.71 per share) is trading below its book value (NTA=RM 1.27 per share).

• Wrongly classified with long-product Steel counters ( PE = 12x ) which were affected by the slow down in the domestic construction sector. Mycron has zero exposure to construction sector.

• Mycron’s PE ratio should be the same as its clients (electronics, auto, furniture, and drum for petroleum & palm oil industries) with PE=14x

• Mycron’s share price should be:

RM 1.90 ps (at PE=14x to match Mycron’s clients)

RM 3.18 ps (when new capacity is installed – End 2007)

Once reclassified, the up-side for Mycron’sshare price is tremendous…. + 340%

SUMMARY

STRONG BUY

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