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46 comment(s). Last comment by omione at Aug 18, 2020 3:44 AM
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supersaiyan3
2844 posts

Posted by supersaiyan3 > Aug 13, 2020 12:45 AM | Report Abuse

Fair enough.


Picanto
53 posts

Posted by Picanto > Aug 13, 2020 1:11 AM | Report Abuse

1) Revenue of 929mil cant just divided by 3, the ASP would have increased 15% every month for Q4'20. Based on that factor, revenue for Jun was 350mil, July is +15% from this amount.

2) You added additional cost for 3.3bil capacity, actually 2.2bil already included in Q4'20 cost. Additional cost for Q1'21 is only for 1.1bil capacity and this should be for Aug and Sep only. Additional capacity also came with additional revenue, this wasn't shown in your revenue number for Aug and Sep. :)

3) Effective tax rate is normally lower than the 24% statutory rate.. can use 22%.

4) Not sure how you get the 30% ASP increase for Aug and Sep but if I use 15% for the Jul, Aug and Sep, and with the changes above, i get approximately 1bil PAT as well.

5) Target price: PAT 1bil *2 + 1bil *0.8 * 2 =3.6bil (assume same ASP in Q2, ASP drop 20% in Q3/4). Take PE20 for 2021: 3.6bil/1.3bil shares*20= RM55


greedy44444
2410 posts

Posted by greedy44444 > Aug 13, 2020 1:30 AM | Report Abuse

Vaccine coming soon...still doing the unnecessary calculation. Just make sure you don't earn less or loss money.


OTB
8010 posts

Posted by OTB > Aug 13, 2020 6:46 AM | Report Abuse

Let us go back to history on glove rallies during the H1N1 pandemic.

When we look back at H1N1 pandemic history, the glove rally was over when WHO said the H1N1 pandemic was over/under control. This was after 18 months H1N1 pandemic was discovered.
---------------------------------------
FDA approved 4 vaccine since 15 September 2009,
Topglov and Supermx still sustain profit growth till mid of 2010.
The share price of Topglov was peak in July 2010.
The share price of Supermx was peak in April 2010
-------------------------------------------

I hope history repeats itself, even vaccine is available in 2009 H1N1 pandemic, Topglov and Supermx still sustain profit growth for another 9 months after vaccine approved by WHO. The present vaccine of Russia is not approved by WHO, need sometime for WHO to approve it.
Follow history, the share price of Supermx and Toplov will peak in April or July 2021 like what had happened in H1N1 pandemic in 2009.

Thank you.


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 6:51 AM | Report Abuse

Posted by chopstick > Aug 13, 2020 6:41 AM | Report Abuse

comong la, russian vaccines hoax or no hoax , it doesn't matter , it enough to shake me off, next will be US and China with much trusted announcement , another panic selling, please face the facts, consoling oneself in this forum is just like hippo.


OTB
8010 posts

Posted by OTB > Aug 13, 2020 6:53 AM | Report Abuse

Dear Picanto,
Additional capacity also came with additional revenue, this wasn't shown in your revenue number for Aug and Sep.
Ans : The revenue was increased by 15%. Instead of 310, I used 356.

Assume 954 million in all quarters, PAT for Q1 2020 = 954+834*3 = 3.456 billion
EPS = 3456/1360 = 2.54
Per = 20, the target price = 50.82.

Thank you.


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 6:54 AM | Report Abuse

all fund managers ah pek ah soh etc sitting on few hundred percent paper gain...now knowing more vaccine will be out soon by hook or by crook...

what to do next? wait for few hundred percent gain more?


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 6:55 AM | Report Abuse

tp 50?

wait for alien to buy fm u ah


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 6:57 AM | Report Abuse

anyway thanks to yr great buy call at 3.70+ in may....more than 500% return in 3 months time...

apa mahu lagi


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 7:00 AM | Report Abuse

do u think trump will approve their vaccine b4 election in Nov?

i can bet chicken rice with you


OTB
8010 posts

Posted by OTB > Aug 13, 2020 7:03 AM | Report Abuse

Posted by CharlesT > Aug 13, 2020 6:55 AM | Report Abuse

tp 50?
-----------------
The calculation ended up in this way.
Do not use 50 if you do not like it.
The bottom line I try to say is next quarter result is still good.
The facts are there that PAT is still growing in Q1 2021.

I hope history repeats itself, even vaccine is available in 2009 H1N1 pandemic, Topglov and Supermx still sustain profit growth for another 9 months after vaccine approved by WHO. The present vaccine of Russia is not approved by WHO, need sometime for WHO to approve it.
Follow history, the share price of Supermx and Toplov will peak in April or July 2021 like what had happened in H1N1 pandemic in 2009.

Thank you.


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 7:05 AM | Report Abuse

Posted by OTB > Aug 13, 2020 6:46 AM | Report Abuse

Let us go back to history on glove rallies during the H1N1 pandemic.

When we look back at H1N1 pandemic history, the glove rally was over when WHO said the H1N1 pandemic was over/under control. This was after 18 months H1N1 pandemic was discovered.
---------------------------------------
FDA approved 4 vaccine since 15 September 2009,
Topglov and Supermx still sustain profit growth till mid of 2010.
The share price of Topglov was peak in July 2010.
The share price of Supermx was peak in April 2010u



u should compare the price increase during that time n this round....did their price increase more than 10 times in few months time like this round?


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 7:14 AM | Report Abuse

tp 50...plus kyy's tp 100+ for TG

RUN FOREST RUN.....

https://www.youtube.com/watch?v=x2-MCPa_3rU


freetospeak
5883 posts

Posted by freetospeak > Aug 13, 2020 7:49 AM | Report Abuse

OTB sifu hope to c more of your post. Investor really need them. Thanks a lot !!!


boonlim98
7 posts

Posted by boonlim98 > Aug 13, 2020 8:30 AM | Report Abuse

thank you OTB sifu for your analysis


CCCL
624 posts

Posted by CCCL > Aug 13, 2020 8:31 AM | Report Abuse

Dear OTB, if follow historically, the target achievable. How about any unforeseen circumstances like windfall tax?


Russel
268 posts

Posted by Russel > Aug 13, 2020 8:32 AM | Report Abuse

Thanks sifu OTB for this valueble insight


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 8:35 AM | Report Abuse

sifu otb started to buy oil n gas ah

waiting for yr new ms universe soon


OTB
8010 posts

Posted by OTB > Aug 13, 2020 8:42 AM | Report Abuse

Posted by CCCL > Aug 13, 2020 8:31 AM | Report Abuse

Dear OTB, if follow historically, the target achievable. How about any unforeseen circumstances like windfall tax?
-------------------------
I do not believe in windfall tax.
Wait for budget announcement.
Thank you.


CharlesT
12111 posts

Posted by CharlesT > Aug 13, 2020 8:43 AM | Report Abuse

Many oredi made few hundred percent gain fm glove play..

If 30% of the profit go to oil n gas also can be very huge


OTB
8010 posts

Posted by OTB > Aug 13, 2020 8:43 AM | Report Abuse

Posted by CharlesT > Aug 13, 2020 8:35 AM | Report Abuse

sifu otb started to buy oil n gas ah

waiting for yr new ms universe soon
--------------------
Dear CharlesT,

Wait for buy signal to appear.
Thank you.


CCCL
624 posts

Posted by CCCL > Aug 13, 2020 9:31 AM | Report Abuse

Dear OTB, well noted with thanks.


Equityengineer
1672 posts

Posted by Equityengineer > Aug 13, 2020 9:41 AM | Report Abuse

OTB, that does not include receivables that was in this quarter.


Henry8833
874 posts

Posted by Henry8833 > Aug 13, 2020 11:08 AM | Report Abuse

Out of Top 4, only Supermax and TG are still undervalued, esp Supermax OBM model.
Harta and Kossan are overvalued. If there is bubble, it is always Harta and Kossan and most of second liners like Comfort, HLT etc



I agreed with below views by freetospeak and Probability


Good point CiA Agent @probability...


probability EPS of Super is 5 x times higher than HARTA for the same quarter ending June 20'

Supermax has double the layer of margin with OBM

The margin edge that Harta had with AMG, Super has it twice the strength with OBM

Harta is dependent on U.S for 40% of its revenue.

Supermax has established its network worldwide, Canada, Japan, Brazil and growing....

Even if you use Harta's pre-covid price of 5.5, Supermax share price should be worth 27 plus now...

Cant Supermax earn 6 x Harta's pre-covid eps of 3 cents per qtr with its increasing capacity going forward when the pandemic is over?

Thats just 16 cents per qtr to justify RM 27 with Harta's pre-covid PE
12/08/2020 9:01 PM

Stock: [SUPERMX]: SUPERMAX CORP BHD

Aug 12, 2020 9:17 PM | Report Abuse

I do not know when the pandemic will end. But i know the profit for gloves company will not drop due to pandemic over.it will be sustained by growing capacity and a higher post covid price than precovid.those who imagine the asp will drop bak to precovid level doesnt know how the glove market pricing works. Jus giv a easy example.if super hav 50 billion caps by 2022, it only need 10 sen margin per gloves it can get 800 to 1 billion profit each qtr . 10 sen profit is only usd 50/k.

Do u think supermax cannot sell more than usd50 post covid? B4 covid distributor in us is selling above this price for your info. So thats the reason super is building 5 plant at once. If u hav eliminated all agent n middleman. Super is already the king of obmX.


Henry8833
874 posts

Posted by Henry8833 > Aug 13, 2020 11:09 AM | Report Abuse

Super just included in MSCI Msia and will be included in KLCI soon. More and more funds will be buying and valuation and business will never be the same...

https://app2.msci.com/eqb/gimi/stdindex/MSCI_Aug20_STPublicList.pdf


vinkuat
24 posts

Posted by vinkuat > Aug 13, 2020 11:32 AM | Report Abuse

Dear Mr. Ooi, you did not add the SPOT order. The 10% of the initial line productions and also the additional capacity will goes to the SPOT order. Thanks.


Vairocana9999
255 posts

Posted by Vairocana9999 > Aug 13, 2020 1:13 PM | Report Abuse

Sifu OTB, thank you very much for sharing your calculations and ideas. I will listen to your advice.


Hockey
12 posts

Posted by Hockey > Aug 13, 2020 3:04 PM | Report Abuse

Thanks for sharing


Smile333
8 posts

Posted by Smile333 > Aug 13, 2020 3:09 PM | Report Abuse

Thanks Sifu OTB. Can you please advise to hold Supermax until end of this year or April to July 2021?


Vc Looi
234 posts

Posted by Vc Looi > Aug 13, 2020 4:19 PM | Report Abuse

why some people are very jealous when other are making money ? in fact you can go other place and make your money instead of polluting other people hard work..Because of this kind of selfish attitude he has miss out so many time of wealth making opportunity..sad on you..


George Leong
423 posts

Posted by George Leong > Aug 13, 2020 4:30 PM | Report Abuse

Thank you so much for sharing this article OTB, appreciate it lots :)


newbie8080
2071 posts

Posted by newbie8080 > Aug 13, 2020 5:06 PM | Report Abuse

@ OTB
How do you know August & September ASP increase by 30% respectively?


OTB
8010 posts

Posted by OTB > Aug 13, 2020 8:44 PM | Report Abuse

Posted by newbie8080 > Aug 13, 2020 5:06 PM | Report Abuse

@ OTB
How do you know August & September ASP increase by 30% respectively?
-------------------
I get this information from my subscribers.
I had verified and I believe this information is reliable.
Thank you.


OTB
8010 posts

Posted by OTB > Aug 13, 2020 8:48 PM | Report Abuse

Posted by Smile333 > Aug 13, 2020 3:09 PM | Report Abuse

Thanks Sifu OTB. Can you please advise to hold Supermax until end of this year or April to July 2021?
-------------------
My strategy is to buy and hold until the end of 2020.
I believe the earning of Supermx will be peak after Q1 2021.
It is strictly my opinion.
Thank you.


Lucas Low
16 posts

Posted by Lucas Low > Aug 13, 2020 9:10 PM | Report Abuse

bravo calculation


SpotOn1
158 posts

Posted by SpotOn1 > Aug 13, 2020 9:56 PM | Report Abuse

Agree with the projection


joecool32
20 posts

Posted by joecool32 > Aug 14, 2020 6:05 AM | Report Abuse

Great work! May I raise a few points
1. Interest income - RM1.2b of cash is not without its benefits. In q4's income statement, interest exp = RM17m. We can safely assume RM15m savings here......?
2. Depreciation of new assets might incur higher depreciation. Q4's Fixed asset increase ard RM100m means ard RM3-4m of addt'l depr'n per qtr assuming an avg useful life off 8 yrs. Not sure if this is already included in the 15% cost increase


CharlesT
12111 posts

Posted by CharlesT > Aug 14, 2020 9:57 AM | Report Abuse

fund managers uncle auntie ah soh ah pek hold tight tight on their few hundred percent papar gain no sweat at all on the coming vaccines die die wanna wait for tp rm30 or rm50 or rm100???

Geng....


CharlesT
12111 posts

Posted by CharlesT > Aug 14, 2020 10:07 AM | Report Abuse

One russian not so reliable vaccine oredi made glove co mkt cap vaporated by few hundred millions RM.........what will happen if the next vaccine fm US or UK or Germany or China come out later

maybe will limit up leh who knows


CharlesT
12111 posts

Posted by CharlesT > Aug 14, 2020 10:13 AM | Report Abuse

Maybe aliens will finally come to buy at rm30 or rm50 or rm100 later lah...maybe their planets also kena covid 19 leh

Mayb glove co can sustain their current super asp n high margin for the next 10 years or 20 years or forever leh....

again who knows ...


CharlesT
12111 posts

Posted by CharlesT > Aug 14, 2020 10:15 AM | Report Abuse

if u still scare dont worry...wait for kyy or citibank to come out with more posts n higher tps.....


omione
117 posts

Posted by omione > Aug 14, 2020 10:20 AM | Report Abuse

6 vaccines already in 3rd stage trial. But Supermax earnings will hold its ground. Even if vaccines pass stage 3, implementing the inoculations may not necessarily run in a straight line. There's still uncertain time ahead for vaccines. But an outsized profit awaiting Supermax 1Q21 is more certain.


Smile333
8 posts

Posted by Smile333 > Aug 14, 2020 2:18 PM | Report Abuse

Thank you once again Sifu OTB!

-------------------
My strategy is to buy and hold until the end of 2020.
I believe the earning of Supermx will be peak after Q1 2021.
It is strictly my opinion.
Thank you.


qwz2604
15 posts

Posted by qwz2604 > Aug 17, 2020 11:43 AM | Report Abuse

thank you OTB for the calculations and analysis. Very much appreciated!


pxxluo
6 posts

Posted by pxxluo > Aug 17, 2020 2:29 PM | Report Abuse

Hi OTB, thank you for sharing. Can I check how to get the latest analyst briefing that you have dated 11th Aug? I saw a copy that is dated 9th Aug, and I can not find the 3.3B cap increase you mentioned. On my copy, I see this on slide 16.
PLANT #12
Block A - fully operational
 Capacity - 2.2 billion per annum
Block B
 Installation of production lines resumed since 4.5.2020
 Target to start commissioning for 1
st 4 double former lines by 3Q CY2020
 Remaining 4 double formers lines by 4Q CY2020
 Capacity – 2.2 billion per annum

Thanks.


omione
117 posts

Posted by omione > Aug 18, 2020 3:44 AM | Report Abuse

I wanted to know in the event ASP in FY23 declines, what will be the fair value of Supermax shares be? And what I found is nothing short of shocking. The current selldown of Supermax is absolutely ridiculous. It’s simple NUTS.

I’ve done the FY21, FY22, and FY23 estimate based on conservative assumptions. I still come up with the following EPS (based on current 1.36b share outstanding):

FY21 Rm2.52
FY22 Rm2.47
FY23 Rm1.85

Look. I intentionally left out the Rm120m profit Supermax claimed it did not capture in time for 4Q20. If this was included in FY21, the EPS would have been Rm2.61.

Bear in mind that certain analyst reported that the ASP in Jun 2020 already hit USD120 per thousand. Here I only assume an ASP of USD90 for FY21.

Also the cost reported in 4Q20 was 39% of revenue. Yet in this exercise I assume a higher ratio. This is to account for teething problems with new production lines coming into operations after Dec 2020.

Let’s ignore the sterling results of FY21 that most of us expect. Even if EPS for FY23 declines as projected here to Rm1.85 (with the assumption that ASP will decline to USD48), the Rm16.70 closing price today still jarringly missed price Supermax. It’s NUTS!

Can a fast growing company like Supermax be priced at just PE 6 to 9? Frankly, if the investment banks are not picking up this jarring mispricing, they should just close shop.

[I would love to support the above comments with my Excel Spreadsheet. But I don't seem to be able to post it. Will appreciate if someone can tell me how to do it.]

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