Business Growth Investing
HLT: Growth Glove Company Yet to Realised Its Actual Value
HLT Current Price 57
HLT has gone unnoticed by the market that it has a subsidiary making rubber gloves with 1 bil pieces annual capacity which is similar to Rubberex and 25% of Careplus capacity.
HLT Global Berhad (“HLT”) is an investment holding company, whilst its two subsidiaries, HL Advance Technologies (M) Sdn Bhd (“HLA”) is in the business of fabrication of glove-dipping lines (“Glove-Dipping Lines Segment”) and HL Rubber Industries Sdn Bhd (“HLRI”) is in the business of manufacturing and trading of rubber gloves (“Rubber Gloves Segment”). Glove-Dipping Lines Segment HLA is principally involved in the following business activities:- (i) design, fabrication, installation, testing and commissioning of glove-dipping lines (“Sale of New Lines”); (ii) provision of upgrading and modification works for glove-dipping lines (“Upgrade and Modification”); and (iii) supply and trading of associated parts and components (“Supply and Trading”)
Rubber Gloves Segment HLT completed the acquisition of the 55% issued share capital of HLRI on 17 May 2018. HLRI commenced operations in 2003 and since its establishment it has proven track record on delivering quality products and services to its multinational customers. The rubber glove products include, amongst others, natural rubber gloves such as powdered and powder-free latex examination gloves, and synthetic rubber gloves such as powdered and powder-free nitrile examination gloves. Over the recent financial years, our products have been sold within Malaysia, and to other countries such as Taiwan, United States of America, Spain, Singapore, New Zealand, China and United Kingdom. In addition, HLRI is also certified to comply with the ISO 13485 : 2016 and EN ISO 13485 : 2016 requirements on medical devices quality management system for manufacture of non-sterile latex and nitrile examination gloves and ISO 9001 : 2015 requirements on quality management system for manufacture of non-sterile latex and nitrile examination gloves, both accredited by the United Kingdom Accreditation Service.
HLT is in the business of making dipping lines for the gloves industry ..... and they have just signed an exclusive licensing agreement on patented triple dipping glove manufacturing line. HLT also owned a 55% subsidiary HL Rubber Industries with production capacity of 1 billion piece per year. With such capacity at current ASP, we shall be seeing HLT turning in good profit
So, in line with the popularity of glove sector now, this stock had good potential.
For FYE 2019, the rubber gloves segment posted a revenue of RM90.673 million. For current year quarter, the rubber gloves segment delivered revenue of RM19.314 million, 44.03% lower than preceding year quarter. Export sales contributed 92.30% of the total revenue of rubber gloves segment.
The export market mainly consists of Taiwan, Southeast Asia, United States of America and Spain. The rubber gloves segment recorded a gross profit of RM0.173 million with a gross profit margin of 0.90% as compared to a gross profit of RM2.067 million with gross profit margin of 5.99% in the preceding year quarter. For FYE 2019, the rubber gloves segment recorded gross profit of RM1.269 million with gross profit margin of 1.40% as compared to gross profit of RM2.131 million with gross profit margin of 2.71%. The rubber gloves segment recorded loss before taxation of RM1.086 million as compared to a profit before taxation of RM0.741 million in preceding year quarter. For FYE 2019, the rubber gloves segment recorded loss before taxation of RM2.290 million as compared to loss before taxation of RM0.370 million in the FYE 2018
With the increase in ASP it profits will quantum leap.
Assuming maintain of only eps of 1.5 cents per quarter which constitute of 6 cents and pe of just mere 15 would give them a 90 cents value!. Margin of Safety of 57% with conservative 15 pe.
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Stock: [HLT]: HLT GLOBAL BHD
May 29, 2020 4:30 PM | Report Abuse
ADVENTA 1st to fly off n to lead the covid theme. Helped by glove.money, the super bull forces.
All mighty GLOVE plc needs HLT expertise.
HLT also owns a glove factory...
HLT, the next ADVENTA next week ...
2020-05-30 12:45
Investing is ALL abt risk.
RISK it w SMART money to gain..
At this pt, HLT could be just in the NEW beginning like GLOVES 7 weeks ago.
IF not, sell fast in the week, the risk is small to take, the reward is so BIG..
2020-05-30 15:45
Malaysia has been in bear market for far too many yrs . The operators cannot wait any longer. This why its break out just like volcano . Only those who r daring only make money
2020-05-31 11:23
If you guys do a deep research on UG Healthcare (Malaysia’s company listed in Singapore), you guys will realize that it is quite similar to Malaysia listed Supermax and Top Glove. The reason Supermax and Top Glove up alot since Supermax release their quarter report is because these 2 companies are distributing their own brand of glove which lead to higher profit margin. You guys can understand further from the video as per below link. After watching, you guys can go read UG's report and you guys will realize that UG has their own distribution center at China, Nigeria, UK, German, US and Brazil. Despite UG didnt own 100% of share of these companies, but definitely it helps UG to have better profit. Also, these coutries are badly affected by Covid-19.
https://klse.i3investor.com/blogs/kianweiaritcles/2020-05-28-story-h15......
Also, not to neglect that Ug Healthcare German is also selling mask, PPE, disinfection, protective clothes etc. All these products are high demand product during this Covid-19. Please refer to the link to understand better.
Besides, UG Healthcare Nigeria is also very interesting distribution center as it is selling the similar products that UG Healthcare German is selling but on top of that, it is also selling infra-red thermometer which is also high demand. Please refer to the link below.
https://www.unimedicalhealthcare.com/aboutus.html...
The link below will enable you to understand better about Uniglove UK. Even though it is old news but it definitely will be benefited during this pandemic as it is Europe’s first antimicrobial nitrile glove.
https://www.hsmsearch.com/page_960209.asp...
https://www.buildingbetterhealthcare.com/news/article_page/Two_firms_j...
https://unigloves.co.uk/fortified-biocote-antimicrobial-gloves...
https://klse.i3investor.com/blogs/kianweiaritcles/2020-05-29-story-h15...
If we do comparison between Rubberex Malaysia and UG Healthcare. UG healthcare is lagging behind.
Rubberex market cap = (rm3.56/3.06) * 252195617 = SGD 293,404,051
UG heathcare market cap =（SGD 0.47 * 196092856）= SGD 92,163,642
UG yearly capacity is around 3B where Rubberex only 2B.
So if we use production capacity ratio to market cap as below calculation. UG should worth SGD
(293404051 (Rubberex’s market cap) * 3B (UG’s capacity)) / 2b (Rubberex’s market cap) = 214685891
UG’s potential share price = 214685891 / 196092856 (no of UG’s issued share)= SGD 1.09
If we do comparison between Careplus Malaysia and UG Healthcare. UG healthcare is also lagging behind.
Careplus market cap = (rm1.40/3.06) * 531,359,799 = SGD 243,105,790
UG heathcare market cap =（SGD 0.47 * 196092856）= SGD 92,163,642
So if we use production capacity ratio to market cap as below calculation. UG should worth SGD
(243105790 (careplus’ market cap) * 3B (UG’s capacity)) / 4.1B (careplus’ capacity) = 177882285.4
UG’s potential share price = 177882285.4 / 196092856 (no of UG’s issued share) = SGD 0.907
Even though careplus produce 1B pcs extra compared to UG healthcare, but UG healthcare will benefitted from it’s own brand of glove as well as it’s distribution centers in UK, Brazil and Nigeria are selling others PPE and tools which are badly needed during this pandemic.
If we use the method of one of the Malaysia’s famous investor to calculation the price per glove, UG healthcare is on 0.09 per glove which is much more cheaper compared to peers.
Even though the last quarter report seems like “poor”, but it was mainly affected by the production modification cost where the board has decided to on hold the modification in order to cope with the sudden spike of demand. Do take note that the modification at the end will benefit the group as well. UG has reported positive earning for the last 3 FY. In fact, increase of marketing expenses is good for the company in long run as once everyone know about “Uniglove”, the marketing expenses eventually will come back and profit will go up.
Most likely August report will have flying colour result.
Stay tuned!!!
2020-06-01 09:19
if result out no good then next qtr result will be super good..buy n keep
2020-06-07 09:21
I made comparison between top 4 gloves and 2nd tier glove comfort, carepls and rubberex, the findings was HLT subsidiaries HL Rubber has the lowest production capacity at 1.1b/year annually or 92m/mth.
HL Rubber by the way is 55% owned by HLT not 100%, means they income from subsidiaries will contribute 55% only.
Lets say 1 pcs of HL Rubber glove sell at myr 0.10c, 92m will generate rm9.2m revenue. 55% from 9.2m would be 5.6m.
As we have no data what would be the ASP rise for HL Rubber from Apr-Jun, conservative 20% would made revenue at 6.72m.
If read past qtr rpt, 1/3 revenue is from glove dipping line and 2/3 is from rubber glove, not sure how much sipping line segment will improve but for sure would not able to beat rubber glove.
Hence, based on expectation and current price hike, i have doubt that coming qtr rpt will have significant profit growth compare to the top 4 and 2nd tier gloves producer due to its smaller capacity and 55% owned HL Rubber subsidiaries.
However, this is just my personal opinion, please do your own research to have better picture.
2020-08-20 07:45
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yes. hlt haven't move much as compared to other glove stocks
2020-05-29 17:39