Author: freetospeak   |   Latest post: Fri, 4 Sep 2020, 10:31 AM



Author:   |    Publish date:

From the extract below. 

SUPERMAX capitalisation is at 31 bil. Assuming PE 25. Supermax need to make Annual profit of 1.25 billion or an average QTRLY profit of 312 million. (extracted from THE EDGE. This is for FY2021)

For Q4 FY2020 Bloomberg consensus estimate is 382 m - 71-30-24 = 257 millions

With the upcoming QTR 4 result.My estimate is about 447 mi  > 257 m Bloomburg consensus 

(PAT 336 million - PAT 558 million (AVG 447 million)


For FY2021. My latest projection for SUPERMAX QTR 1 is about 800 m PAT to 1 billion PAT.

That is about 3.2 bill ANNUALLY (2.56x of Bloomber consensus)

or eps of RM2.46 x pe 20 = TP50.00 (ex-bonus tp 25)

I will provide a clearer calculation after the release of QTR 4 results to justify my projection.





This is not an advice to buy or sell. It is my own personal opinion for sharing. 

I do not take accountabiitly for any trading occuring from my information.

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  44 people like this.
probability wow..that means if Q4 earning is 450m, price will shoot up to 33..Fantastic!
06/08/2020 9:35 AM
vanness_lyh Support Master Freetospeak!
06/08/2020 9:36 AM
staypositive Thank you sir
06/08/2020 9:42 AM
freetospeak pls support ah..freetospeak told me his eye becom blurry after this post...becoz urgent mission received. Poor man..drink kopi also must do work.
06/08/2020 9:45 AM
06/08/2020 9:45 AM
troy88 Thanks Freetospeak. Nice one.
06/08/2020 9:47 AM
DJoker89 OMG ......
how about >500mil.....RM40? RM50?


Thanks freetospeak sifu....hahaha now i can HOLD with confident
Huattttt Ahhhhh
06/08/2020 9:50 AM
cbpenbrush Feel comfortable investing in Supermx with your informative analysis and calculations.
06/08/2020 9:52 AM
Goldberg Totally agree with your projection for Q4 PAT of Rm447. I just want to add rm1 mil to it to make it RM448.- Die die lucky LOL.
06/08/2020 9:54 AM
invest200 Thank you for the info and analysis
06/08/2020 10:03 AM
prettyandrich Thanks a lot!!
06/08/2020 10:04 AM
dhnn81 Thank you @freetospeak!
06/08/2020 10:11 AM
terrylam84 A very insightful piece of article
06/08/2020 10:13 AM
Ricky Yeo lol $3.2 bil PAT per annum. Your estimation doesn't grow to the sky. It is the sky
06/08/2020 10:15 AM
Ricky Yeo When someone can paddle any shit and everyone else would gladly eat it
06/08/2020 10:16 AM
Jpmontoya73 Thanks Sifu freetospeak, you make all of us more confident..masterclass!!
06/08/2020 10:18 AM
see2sea thank you sifu for this informative article..hope can enlighten all the investors
06/08/2020 10:18 AM
super_newbie Thanks for hard work!
06/08/2020 10:18 AM
freetospeak ricky...no one is taking my piece of shit seriously...dun be so serious..lol
06/08/2020 10:23 AM
Goldberg You sound like a loser Ricky Yeo. Sad.
06/08/2020 10:24 AM
Jpmontoya73 Thanks Sifu freetospeak, you make all of us more confident..masterclass!!
06/08/2020 10:25 AM
inPeace Good job freetospeak. I will limit my exposure in other stocks and move to Supermax.
06/08/2020 10:29 AM
justbuy Once again, thanks for the hardworks @freetospeak sifu.
You deserve a medal for all these.
06/08/2020 10:57 AM
2721 Luckily superman bossy generous to inform public tat he is doin OBM majorly, if nt reali no confident and brave enuf to hold so long
06/08/2020 11:02 AM
probability https://www.theedgemarkets.com/article/how-much-profits-do-glove-makers-need-sustain-rally?type=malaysia

KUALA LUMPUR (Aug 6): Based on historical valuation, which investment analysts said has been thrown out of the window by now, the glove manufacturers are trading at price-earnings ratio of more than 100 times.

Top Glove is currently the second largest company by market value in Bursa Malaysia, followed by Hartalega as the third biggest. Only Malayan Banking Bhd (Maybank), the country’s biggest bank in asset size, is more valuable than the two glove manufacturers.

Interestingly, even Supermax Corp Bhd and Kossan Rubber Industries Bhd are already among the top 25 largest firms in terms of market value in the local bourse. Supermax is 16th and Kossan 21st.

Against the backdrop of anticipated exceptionally strong demand for disposable rubber gloves due to the Covid-19 pandemic coupled with a big jump of 30% in average selling price, investors are pouring money into glove manufacturers with high hope that they will churn not just profits in current harsh economic conditions but super profits.

Investment analysts have been raising earnings forecasts as the meteoric rally continues and the glove stocks surpass initial target prices.

As the glove companies are due to release their financial results soon. How much earnings do they need to deliver to sustain their currently high share price levels?

According to Bloomberg data, earnings consensus for Top Glove’s financial year ending Aug 31, 2020 (FY20) is a record high of RM1.44 billion and a whopping increase to RM3.81 billion the year after.

A back of envelope calculation, on a simple average, Top Glove would need to achieve RM866 million in net profit in the quarter ending Aug 31 - a 149% jump from the preceding quarter to meet market expectations.

This is more than four times the quarterly net profit of Nestle (M) Bhd for the financial quarter ended March 31, 2020.

Hartalega announced its record high net profit of RM219.72 million in the first financial quarter ended June 30. But the stellar set of financial results did not add fuel to its share price rally as it fell short of market expectations.

Still, analysts upgraded earnings forecasts noting that profit margin will be wider as a result of higher average selling price in upcoming quarters. In short, analysts are of the view that the exponential growth has yet to kick in.

Market consensus forecast Hartalega's annual profit went up to RM1.61 billion for the financial year ending March 31, 2021. This means that Hartalega's 1QFY21 net profit only accounted for 13% of the full-year earnings consensus.

To meet the market consensus, Hartalega will need to achieve an average of RM479 million in each of the three upcoming financial quarters. This translates into average earnings growth of 346% y-o-y.

Likewise, Supermax and Kossan are expected to see a 260% and 207% q-o-q growth respectively this coming quarter to meet their earnings consensus.

Supermax’s market capitalisation is currently at RM31.28 billion. Assuming a P/E ratio of 25 times, which is considerably high for the manufacturing sector, Supermax needs to make an annual net profit of RM1.25 billion, or an average quarterly profit of about RM312 million. Meanwhile, Kossan Rubber is expected to deliver annual net profit of RM974 million, averaging RM243.5 million in each quarter.

What about the smaller players?
Similarly, based on the P/E of 25 times, for Comfort Glove Bhd to justify the current market capitalisation of RM3.78 billion, it will have to make an annual net profit of RM151.56 million.

Rubberex Corp Bhd’s market value has swelled to RM1.881 billion. At the P/E valuation of 25 times, the glove maker is expected to achieve annual net profit of RM75.24 million, or RM18.8 million a quarter.

Over at Careplus, its market capitalisation is at RM2.918 billion. To justify a P/E ratio of 25 times, the company needs to churn an annual net profit of RM87.92 million - an amount that is almost equivalent to its market value a year ago of RM85 million.
06/08/2020 11:07 AM
zzzz52 lol, after Q4 results we will know if this is a piece of shit or a precious gem.
But I have to thanks @freetospeak for taking time to make this post.
06/08/2020 11:45 AM
BingoWin Freetospeak Sifu, I have been following this forum since the outbreak of the Covid 19 pandemic. By and large, your comments with fact and figure are the most valuable information yet assuring for the real and long term investor like me and many others albeit conservative in projection. I personally have full confident in your detailed calculation, hopefully will come to fruition by the release of coming bombastic quarter earnings. I fully support your informative and reliable blog and keep our figure crossed to the realisation of our dreams. KUDOS to you. Keep posting for the benefit of real investor like me.
06/08/2020 11:47 AM
freetospeak thanks to many of my friends with vast knowledge both glove related and non related for verying n cross checking my stats n calculation. I also try to be truthful to myself becoz i am also investing base on the same information shared to everyone here.

Hope it is more than my prediction n much much more...lol
06/08/2020 11:50 AM
lavenderguy good job freetospeak sifu...believe in you!~ hold tight tight as I dun have any more bullet to top up...just wanna earn downpayment for my new car.lol
06/08/2020 12:03 PM
superman_ @freetospeak excellece! Thank you! I cant wait to see supermx qr out with explosion of price limit up. And also want to see those look down on supermx go hospital for their cant accept the good qr result.
06/08/2020 1:27 PM
andrew2020 Sifu Freetospeak, Many thanks!!!
06/08/2020 1:34 PM
andrew2020 You are the best!!!
06/08/2020 1:34 PM
Power1 Thank you Sifu.
06/08/2020 1:47 PM
freetospeak thanks everyone...
06/08/2020 1:51 PM
greatful21 Thank you for hardwork and kindness
06/08/2020 2:06 PM
kytan Great. U will earn big on what u believe. I am 75% in supermx 25% in topglove. And i very happy with my glove earning and i believe supermx is the final winner in % gain
06/08/2020 2:12 PM
Vencho Good info. Thank you.
06/08/2020 2:34 PM
06/08/2020 2:43 PM
degaht good one
06/08/2020 3:12 PM
Sypher @freetospeak, you deserve all the credit this forum is giving you. Not just because you are optimistic, but because you are educating us all. Props bro.
06/08/2020 3:13 PM
Sypher @freetospeak, you deserve every cent you make bro
06/08/2020 3:18 PM
rina23 @freetospeak, thank you for all your hard work and efforts. You deserve all the respects from all of us investors. Cheers!
06/08/2020 3:43 PM
Vairocana9999 @freetospeak sifu, thank you very much for your hard work and timely reminder since April. I am waiting excitingly for the Qtr4 big day.

I believe Mr Stanley will shower us with many good presents. He will not fail his supporters. Thanks.

I am still holding tight all my Super. He he.
06/08/2020 4:04 PM
sAhaM2020 i think PAT 300-350 M is reasonable expectation
06/08/2020 6:35 PM
roadtomillionaires Thanks sifu for your valuable info.
06/08/2020 7:45 PM
diuleiloumei @freetospeak
447m Q4FY20 is conservative projection or maximum projection ?
06/08/2020 11:18 PM
freetospeak i would say a reasonable projection . can be lesser or higher. not maximum.
07/08/2020 10:13 AM
Ismylife73 Hi, thanks for the info. what is the justification of PE 20 and 25? When and why is the range to be used?
10/08/2020 8:48 PM

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