Highlights
KLSE: TEXCHEM (8702)       TEXCHEM RESOURCES BHD MAIN : Industrial Products
Last Price Today's Change   Day's Range   Trading Volume
1.29   0.00 (0.00%)  1.27 - 1.33  1,460,100
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Overview

Market Cap: 160 Million
NOSH: 124 Million
Avg Volume (4 weeks):1,299,531
4 Weeks Range:1.13 - 1.35
4 Weeks Price Volatility (%):
72.73%
52 Weeks Range:0.58 - 1.38
52 Weeks Price Volatility (%):
88.75%
Average Price Target: 0.67
Price Target Upside/Downside: -0.62

Financial Highlight

Latest Quarter | Ann. Date 30-Sep-2021 [#3]  |  22-Oct-2021
Next QR | Est. Ann. Date: 31-Dec-2021  |  24-Feb-2022
T4Q P/E | EY: 9.00  |  11.11%
T4Q DY | Payout %: 0.00%  |  - %
T4Q NAPS | P/NAPS: 2.0433  |  0.63
T4Q NP Margin | ROE: 1.62%  |  7.02%

Headlines

Date Subject
24-Jan-2022 德健购寿司金28%股价败退
20-Jan-2022 Mplus Market Pulse - 20 Jan 2022
07-Jan-2022 热门股:德建资源 上挑RM1.45
21-Dec-2021 Technical View - Texchem Resources Bhd
25-Oct-2021 PublicInvest Research Headlines - 25 Oct 2021
23-Apr-2021 德建资源挑战RM1.29/敏源
17-Mar-2021 Trading Stocks - Texchem Resources
25-Feb-2021 UNDERVALUED CONSUMER STOCK ON BURSA THAT SHOULD SKYROCKET LIKE FOCUS POINT SOON! (UPDATED)
23-Feb-2021 Stocks on Radar - Texchem Resources (8702)
11-Feb-2021 PublicInvest Research Headlines - 11 Feb 2021
11-Feb-2021 Mplus Market Pulse - 11 Feb 2021

Business Background

Texchem Resources Bhd is an investment holding company. The group has four business divisions namely industrial, polymer, engineering, food, and restaurant. The products under industrial segments are plastic resins, rubber/latex chemicals, PVC resins and additives, adhesive chemicals, food ingredients, dyestuff and textile auxiliaries. The polymer division designs new polymer solutions and designs for industries such as data storage industry, semiconductor, consumer electronics and electrical, telecommunications and life science industry. The restaurant division operates restaurant brands such as sushi king, Miraku, Goku Raku Ramen, Yoshinoya, Hanamaru Udon and Doutor Coffee. The Malaysian market contributes most to the company's revenue.
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  5 people like this.
 
wallstreetrookie It is extremely easy to recommend cyclical stocks. Low PE - Dump. Negative earnings - Buy the dump. That's literally it. And perhaps follow commodities trend
31/12/2021 11:18 AM
wallstreetrookie I challenge @calvintaneng to find a growth stock for 2022. No more traditional companies. The ones with no PE.
31/12/2021 11:18 AM
wallstreetrookie Haha anyways happy new year Calvin. Ta-ann was a good call
31/12/2021 11:19 AM
lomas Why suddenly up 7 cents, got any incoming good news?
31/12/2021 3:40 PM
Cockroach Paul Lee TEXCHEM 2022 crazy stock! BULL
hahaha rocket
02/01/2022 12:46 AM
Albukhary TEXCHEM, still the most undervalue stock.

Industrial Chemical Segment - Super Good.

F&B Sushi King -Super Good, all restaurant still full with patron.

Fishing - Myammar business return to profit.

This is the one of the best recovery stock to bet for 2022.

Minimum target price - RM2;00
07/01/2022 12:07 AM
Albukhary 1st TP - RM0.90 (Achieved)
2nd TP - RM1.10 (Achieved)
3rd TP - RM1.30 (Achieved)
4th TP - RM1.75
5th TP - RM2.20
6th TP - RM2.80 (then proposed Bonus Issue or Share Split)

Sushi King business is very good (super good, need to wait for seat).
Chemical business also very good. (No more MCO, can run at 100% capacity)
LifeScience business also very good. (No more MCO)
Myammar fisheries business back to normal. (Political more stable compare to last quarter)
Property is at strategic location. (waiting for revaluation)
Property market value is much much higher than book value.
NTA RM2.00
124mil share only.
Market cap RM111mil.

Last time Chicken Rice Shop sold to Japanese buyer for RM200mil.
Don't you think Sushi King will worth at least RM300mil.

Hextar bought a lot of chemical company at high price.
If Hextar want to acquired Texchem Chemical business (Industry chemical + Life Science), I think minimum it will offer RM300mil.

So, TEXCHEM is worth RM300m + RM300m = RM600m.

RM600mil / 125mil unit of share = RM4.80 per share.

Give it a superb durian runtuh discount of 50%, still worth RM2.40 minimum.
07/01/2022 12:09 AM
Albukhary Q4'2021 is superb quarter for Texchem.
Especially for it's F&B business Sushi King.
07/01/2022 8:56 AM
Albukhary TEXCHEM
- Market Cap - RM158mil
- NTA - RM260mil (65% upside)
- Enterprise value - RM600mil (280% upside)

Q4'2021 result - Estimated EPS 7sen - 10sen.
09/01/2022 8:19 PM
blackchicken Samchem
09/01/2022 8:23 PM
Albukhary TEXCHEM, 你不能错过的一支严重被低估的黑马.
2022 高估值的科技股将会退潮,资金会开始流入被低估,实实在在做生意的公司.
TEXCHEM无论是盈利, 资产, 生意规模, 管理层, 品牌, 都是不错的, 而且严重被低估.
10/01/2022 10:15 PM
Liontexchemer Wow. This QR have 20 million PBT. Coming ~~
17/01/2022 1:16 PM
Powerplay666 Liontexchemer.. How do you see 20 million pbt this qr? At best, with the opening up after MCO, I see 5m.
17/01/2022 6:26 PM
Albukhary I estimate profit around 12-15mil
17/01/2022 8:57 PM
samchong6891 Albukhary how you calculate bro ?
19/01/2022 12:43 PM
Liontexchemer No need calculation. They have share it among their meeting this Monday…@@ Total PBT this year is 3X M… =) But it fly since last month. =(
19/01/2022 4:54 PM
newguy0801 Is it worth it to sell Sushi King?
https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3227193
19/01/2022 5:50 PM
Albukhary Many people ask me why TEXCHEM proposed to purchase the 28% share at RM102.2 mil, how they arrive at this valuation.

The answer is very simple, this RM102.2mil is the original investment amount that Yoshinoya Group invested for the 28% in 7 years ago.

Back to 2015, Texchem has sold 28% share of Sushi King to Yoshinoya Group at RM102.2mil.
7 years later, Texchem buy back the 28% share at RM102.2mil.

7 years ago, Sushi King have 89 outlet.
7 years later (after pandemic), Sushi King has 121 outlet.

7 years ago, Sushi King is very profitable, can generate RM15-20mil profit per year.
Recent this two years, due to Covid Pandemic, the Sushi King business is very bad, loss a lot of money. However, if assume everything can back to normal, the Sushi King should be able to generate RM25-30mil profit per year.

RM30mil divided 121 outlet, we are talking about RM250,000 per outlet per year, or equivalent to RM20k profit per outlet per month.

Currently Texchem have 70.35% of SushiKing.
If 28% is worth RM102.2mil, then the 70.35% is worth RM256 mil.

Texchem market capital is RM163mil.

Texchem have Chemical business, Food business, Restaurant business, Life Science business.

Just a restaurant segment is worth RM256 mil, the whole group should worth minimum RM500mil.
20/01/2022 1:22 AM
iyin666 Expect strong Q4 - 7 to 12 mil
20/01/2022 10:20 AM
Questionking Still good buy texchem ?
20/01/2022 11:10 AM
Powerplay666 Anyone knows when qr is out?
20/01/2022 11:11 AM
Alwinb 28% of Sushi King for 102 mil is equivalent to paying 3 mil for each Sushi King outlet. Given Sushi King mediocre sales, it is much cheaper for texchem to open new outlets instead of buying up the 28% stake.
20/01/2022 4:01 PM
Alwinb Texchem announcement fail to justify for the high price by comparing with peers valuation
20/01/2022 4:07 PM
Alwinb Just compare berjaya food and sushi king
20/01/2022 4:09 PM
Alwinb ROI for the 102 mil is only 3% based on the best of the past 5 years Sushi King profit after tax 2+(2016 to 2020) This is the justification provided for the purchase price. Not convincing
20/01/2022 7:04 PM
Alwinb Why spend money on share buy back when the share price is near its historical 52 weeks peak.
20/01/2022 7:06 PM
Albukhary Don't treat it like a purchase, just treat it as a repayment of borrowing.

Treat it like 7 years ago Texchem pledge 28% to Yoshinoya and borrow RM102mil from them, and 7 years later Texchem payback the RM102mil and get back the 28% share.

During this 7 years, you have take the money and expand the business from 89 outlet to 121 outlet.
And due to pandemic, Yoshinoya group personally badly hitted by the crisis, and now they want Texchem to payback the RM102mil, so they return back the share.

Then you will feel comfortable with the deal.
20/01/2022 10:54 PM
Alwinb As an investor, I would like the see all transactions, especially for related party,, done above board.

In this case, there was an outright share sale to Yoshi without any Put option.

However, Texchem appears to guarantee Yoshi by buying back the shares at the same price if investment is not up to expectation.

This is akin to Texchem failing to report a Contingent Liability.

No point having audited published account if investors have learn to be ''comfortable' with the Board decision based on gentlemen agreement.

Investing in KLSE would be taking a big bet due to lack of transparency and poor corporate governance.

I see Texchem potential but I am also disappointed by Texchem questionable decisions.
21/01/2022 6:57 AM
Alwinb The next question is are there more surprises
21/01/2022 6:59 AM
Alwinb Oh yes, MSWG please examine the deal with Yoshi to buy back Sushi King...
21/01/2022 7:17 AM
Alwinb With Omicron cases increasing, why is Texchem paying such high valuation for Sushi King.
21/01/2022 7:48 AM
Albukhary Yup, from a investor perspective, I agreed this transaction is lack of transparent.

But, from business perspective, Sushi King business is getting very good recently, especially after the lockdown on June/July/Aug, all the mall / restaurant traffic is surge dramatically.

Back to 7-8 years ago, Japanese food is mostly consumed by chinese (90% customer is chinese).
But nowadays, many malay can accept japanese food, and chinese have gradually move to higher range japanese food restaurant.

Hence, nowadays you can see Sushi King customer majority is Malay. Compare to other japaneses restaurant, Sushi king price is at affordable level, 1 small family (2 parent and 2 kid) go to eat until full the price can be within RM80-100.

You can wait for the quarter result, I believe sure you can see the F&B business segment start to generate nice profit for Q4 2021.
21/01/2022 9:37 AM
sense maker Clearly minority shareholders should lodge a police report against the Japanese ceo for handing out RM102m cash to Yoshinoya for a 28% stake in a struggling biz.
21/01/2022 9:43 AM
Alwinb Yes, let's wait for the current quarter result. Also, I hope to see the high inventory level, which is increasing for the past quarters come down.
21/01/2022 10:07 AM
sense maker Net debt of the company will double to RM200m. This is a cornered stock, kept artificially at a relatively high price of RM1.30. When the banker leaves, the fall will be severe. Banker normally leaves when there are other big buyers coming in or when the fundamentals of the company deteriorate too much, relative to the prevailing market price. Don’t be lulled by the seeming stability of its share price at the current elevated level.
21/01/2022 10:09 AM
Alwinb 90% of the debt is due less than 1 year and for trade finance purpose. The fact that these are provided on an unsecured basis means Texchem is well rated by FIs. The long term debt has been declining to a negligible level.
21/01/2022 10:15 AM
Alwinb Generally, Texchem has respectable operating cash flow despite reporting mediocre profit to losses due to high depreciation charge
21/01/2022 10:18 AM
Alwinb With the small capital of 130mil, Texchem has not only never stop growing but indulge itself in capital intensive business which require high R&D expenditure and long gestation period like green polymer and aqua culture
21/01/2022 10:25 AM
Alwinb All these were funded by internally generated funds and bank borrowing... Not thru placements
21/01/2022 10:27 AM
Alwinb That is why despite my concerns, I do see potential in Texchem
21/01/2022 10:28 AM
sense maker For 3 quarters at the height of covid 19, the company did well in selling face shields and polymer products, making RM22m net profits in total. As the covid fades, the past 2 quarters have seen dismal results. The company now struggles to make any net profits. The high depreciation charge is partly offset by its need to continually spend on capex. With breakeven results, net cash flow generated is around RM5m to RM10m. It will take the company at least 20 years to pay down its RM200m net debt. Good luck.
21/01/2022 10:37 AM
airfan99 what i do not like the management. pofit down but salary / numeration is up
21/01/2022 2:07 PM
Liontexchemer I am surprise with their 4th QR but also surprised by their decision on hand out the cash to yoshinoya. Maybe they saw their main contribution for this QR is still No.1 with restaurants segment. Their chairman sometime did thing unpredictable.
21/01/2022 4:36 PM
iyin666 Texchem Q4 results going to be very good. Someone here mentioned Rm15 to 20 mil. Buy Texchem for its turnaround story n not it's acquisition story.
21/01/2022 4:43 PM
Liontexchemer Seem like you also attend the meeting on this Monday.
21/01/2022 5:14 PM
rasee98 iyin666
what is the expected TP. tq
27/01/2022 5:02 PM
Powerplay666 Management already shared a big hint of huge profits in the coming qr announcement... I guess some of the market already knows.
27/01/2022 5:59 PM
samchong6891 What big hint Powerplay666哥哥?
28/01/2022 8:08 AM
Nancy Boon can tell us how far it can go...? Someone...thanks
28/01/2022 9:36 AM
Powerplay666 Samchong.. Wait for the qr in Feb. Company has been buying back their shares all week including today.
28/01/2022 5:19 PM


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