Press Metal Aluminium elevates score in ESG metrics; Maybank IB retains Buy call

Press Metal Aluminium Holdings Bhd has been recognised with an above-average score in the Environmental, Social and Governance (ESG) metrics on lower greenhouse gas emissions.

The report states, "Press Metal recorded lower Scope 1, 2 and 3 emissions in FY23 from FY22. With that, greenhouse gas emissions in FisFY23 totalled 11.8 million tCO2e. Greenhouse gas intensity (Scope 1 and 2) also improved to 3.3 tCO2e per tonne of aluminium production in Fiscal year 2023-2024 (FY23). Water withdrawal intensity improved to 2.2 cubic metres per tonne of aluminium."

As a consequent result, Maybank Investment Bank Bhd (Maybank IB) retained a Buy call on Press Metal Aluminium Holdings Bhd with a target price (TP) of RM 5.70, based on a 25 times price-to-earnings ratio on estimated Fiscal Year 2024 -2025 (FY25) earnings.

However, the report also denotes an increase in both nitric oxide and sulphur oxide emissions in FY23, ultimately remitting a score of 63 (out of 100), as mentioned in Maybank Investment Bank's Annual and Corporate Governance Reports.

The ESG scoring has elevated to above average, improving from last year's (Fiscal Year 2022) score of 55.

In addition, the analysts state, "We applaud the declining trend in Press Metal s lost time injury frequency (LTIF) rate to 2.7 per million hours in FY23 from 3.3 per million hours in FY22 and 4.3 per million hours in FY21."

Maybank IB is optimistic about the company's adherence to enhancing its ESG enactment, significantly towards achieving carbon neutrality by 2050 and reducing Scope 1 and 2 emissions by 15% by 2025 and 30% by 2030.