· RHT received written approval from JMG Perak to resume mining operations effective 11 September 2026, marking the end of a c.4.3-week suspension that began on 12 August 2026.
· The resumption announcement did not disclose any operating conditions or ramp-up requirements; we are following up with management for further clarity.
· Based on our sensitivity framework, we estimate the c.4.3-week suspension could reduce 3QFY26 Group PATMI by approximately RM11-12m, though this remains an indicative, unconfirmed estimate.
· We make no changes to our FY26F-FY28F earnings forecasts at this juncture, pending further clarity on the actual impact and post-resumption ramp-up pace.
· Following a review of our dividend payout ratio assumption, our TP is adjusted marginally higher to RM3.07 (from RM3.06), based on 13x FY27F EPS of 23.6sen (from 23.5sen). We maintain our BUY call.
Suspension lifted at RHT. We refer to our earlier update on 19 August 2026 regarding the temporary suspension of mining operations at Rahman Hydraulic Tin (RHT), MSC's 80%-owned mining subsidiary. RHT has now received written approval from the Perak Department of Minerals and Geosciences (JMG Perak) to resume mining operations, effective 11 September 2026. This follows the suspension that took effect on 12 August 2026, implying a total suspension period of approximately 4.3 weeks, moderately longer than the 3-week suspension RHT previously experienced between 13 November and 3 December 2025.
Management stated that RHT remains committed to safe and responsible mining practices, and will continue to work with the authorities on environmental matters, including closer monitoring of weather and site conditions to manage extreme weather-related risks going forward. The announcement did not specify whether the resumption comes with any operating conditions, such as a capacity ramp-up period or interim monitoring requirements, nor whether any permanent upgrades to drainage infrastructure are planned. We are following up with management for further clarity on these points.
Estimated impact. In the absence of updated guidance from management on the precise financial impact, we apply our previously established sensitivity framework. Based on 2QFY26 mining segment PAT of RM44.1m before NCI, we estimate a run-rate impact of c.RM3.4m per week. After accounting for MSC’s 80% equity interest in RHT, this translates into an estimated c.RM2.7m reduction in Group attributable earnings per week of suspension. Applying this to the c.4.3-week disruption implies a c.RM11-12m reduction in 3QFY26 Group PATMI, all else equal.
We highlight several caveats to this estimate. First, the calculation assumes a linear relationship between downtime and lost earnings and does not account for a potential ramp-up period before RHT returns to full production capacity. Second, it remains unclear whether the Group took any mitigating measures during the suspension, such as drawing down existing tin inventories or increasing third-party ore purchases, which could partially offset the earnings impact. Third, our estimate is based on the 2QFY26 run-rate, which may not fully reflect prevailing tin prices or operating conditions in 3QFY26. As such, we view the c.RM11-12m impact as indicative only, pending further clarification from management.
Earnings revision. We make no changes to our FY26F-FY28F earnings forecasts at this juncture. While the suspension has now formally ended, we do not yet have sufficient clarity from management on the actual production loss, any mitigating factors, or the pace of the post-resumption ramp-up to make a reliable adjustment. We will revisit our estimates once this information becomes available.
Valuation. We maintain our BUY call and revised TP of RM3.07 (from RM3.06), based on 13x FY27F and revised EPS of 23.6sen (from 23.5sen). Following a housekeeping review of our
We highlight several caveats to this estimate. First, the calculation assumes a linear relationship between downtime and lost earnings and does not account for a potential ramp-up period before RHT returns to full production capacity. Second, it remains unclear whether the Group took any mitigating measures during the suspension, such as drawing down existing tin inventories or increasing third-party ore purchases, which could partially offset the earnings impact. Third, our estimate is based on the 2QFY26 run-rate, which may not fully reflect prevailing tin prices or operating conditions in 3QFY26. As such, we view the c.RM11-12m impact as indicative only, pending further clarification from management.
Earnings revision. We make no changes to our FY26F-FY28F earnings forecasts at this juncture. While the suspension has now formally ended, we do not yet have sufficient clarity from management on the actual production loss, any mitigating factors, or the pace of the post-resumption ramp-up to make a reliable adjustment. We will revisit our estimates once this information becomes available.
Valuation. We maintain our BUY call and revised TP of RM3.07 (from RM3.06), based on 13x FY27F and revised EPS of 23.6sen (from 23.5sen). Following a housekeeping review of our dividend payout ratio assumption, our forward DPS and dividend yield estimates have been revised down, though the impact on our earnings forecasts and TP remains immaterial. We continue to favour MSC given its positioning as the world's largest independent tin smelter, improving earnings profile and the removal of the immediate operational overhang following RHT's resumption. At RM1.80, the stock trades at 7.6x FY27F EPS, offering an attractive risk-reward against our RM3.07 TP.
Risks. Key risks include RHT ramp-up delays, recurring water-related disruptions, tin price volatility, feedstock and FX risks, and further project delays.
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| Currency | Buy Rates (RM) | Sell Rates (RM) |
|---|---|---|
| USD | 4.056929 | 4.087356 |
| EUR | 4.720659 | 4.723124 |
| CNY | 0.606802 | 0.607109 |
| HKD | 0.517563 | 0.520940 |
| SGD | 3.201349 | 3.222362 |