4324:TSEDentsu Group Inc. Analysis

Hengyuan Refining Company Berhad is trading at a **trailing P/E of 2.9**, dramatically below the industry average of ~22, and a **price‑to‑book of 0.52**, indicating a deep valuation gap. The DCF model suggests a fair value around **RM 17.1**, more than 13× the current price of RM 1.25, while revenue has surged **92.6% YoY** and the company posted a **record Q1 net profit of RM 525.6 million**, reversing a loss a year earlier. Despite thin margins (gross margin ~4% and profit margin ~2.8%), the earnings turnaround and ultra‑low multiples point to a potentially **undervalued** position with strong growth upside.
On the technical side, the stock sits above its 20‑day (RM 1.238) and 50‑day (RM 1.225) SMAs and is trending bullish, with a **MACD histogram turning positive** and a **neutral RSI around 50**, suggesting room for upside without immediate overbought pressure. Volume is rising, support sits at RM 1.14 and resistance at RM 1.39, while volatility is high at **63% over 30 days** and beta is slightly negative, indicating sensitivity to market swings but also a potential hedge. The combination of a strong earnings rebound, extreme‑greed market sentiment, and a massive valuation discount supports a **buy** stance, tempered by sector cyclicality and operational risk.