WHO announces COVID-19 outbreak a pandemic

As World Health Orgnization (WHO) announced Covid-19 outbreak as a pandemic, glove stocks naturally became attractive to KLSE investors.

Followed by healthcare related equipments such as face masks, PPE, hospital beds and inter-related medical equipments and finally the most offensive product is Sanitizers.

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AFTER the new storage tanks refurbishment.

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THIS IS FANTASTIC NEWS FOR NYLEX.

JUST IN TIME AFTER NYLEX NEWLY REFURBISHED ITS FACTORIES IN CHUPING, PERAK.

FERMPRO (a subsidiary of NYLEX) and fully upgraded the whole ETHANOL plant with new tanks and piping.

REMARKS: The benefits achieved after the whole plant refurbished

1) Completely stop all leakages by changing old piping to brand new one.

2) Thus, the end product offers on the purity of Ethanol increased from 95.5% to 99.5%

3) Saving 40% on fuel cost

4) Overall increase by extra 5% production

AND YEARLY PRODUCTION OF ETHANOL IS 5 MILLION LITRES

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Manufacturer is FERMPRO wholly owned subsidiary of NYLEX.

The above picture showing the full client list of Entopest Environmental Services Sdn Bhd / subsidiary of Ancom Bhd (official qualified licensed fumigator, a legal recognition awarded by the Malaysian - Ministry of Agriculture Awards the license upon the completion of intensive course on all aspects of fumigation requirements by the Ministry of Health.

Credentials - wide spectrum of clients (Tier One Clients) from:

i. Hypermarkets - Tesco, AEON, MYDIN, Giant.

ii. Banks - Maybank.

iii. Universities - Taylor's University, UPM, Garden International School.

iv. Corporate offices - Amway, Goodyear, KLK Oleo, Gamuda, Sunway, Gas Malaysia.

v. Hotels - Le Meriden, Renaissance Hotel, Grand Hyatt, The Mines Hotel.

vi. Restaurant Chains - Texas Chicken, Old Town, Secret Recipe.

vii. Logistics/Warehouses - TASCO/NYK Nippon Yusen Kaisha Group, Sanyku Group Japan.

viii. Medical & Healthcare - Ministry of Health Malaysia, Gleneagles Hospital, Caring, Guardian. 

 The above pic shows Entopest is offering full sanitizing services that are compliant to the US FDA regulations for industrial and commercial usage that are highly effective against 

Corona viruses.

The above picture shows a snapshot from one of Petronas stations in Malaysia. In fact, all Petronas station toilets have

 Entopest Hygiene sanitizing facilities.

 In short, it caters for all segments of market - from domestic to commercial uses.

NOTE: GLOVES, FACE MASKS & ISOLATION UNIFORMS ARE DEFENSIVE WEAPONS AGAINST COVID-19.

ONLY SANITIZER WITH MAIN INGREDIENT ETHANOL CAN KILL 99.9% GERMS.

 The price of Nylex RM0.945(closing 01 JUNE 2020) is still at near basement of this cycle price.

We are not surprised that this stock like

HEXZA/3298 can go limit up,

as HEXZA went limit up TWO TIMES:

i) 4 May 2020 - closed RM1.21 (+RM0.30)

ii) 6 Aug 2020 - closed RM1.97 (+RM0.45)

The glove stocks have gone from the low from March 2020 to May 2020 astronomical prices.

In KLSE, you have noticed that there are very big volumes of buyers, and also big voumes of sellers on the glove stocks.

The reason is that the buyers are issuing buy orders with the understanding will go higher.

However, little did you know that the current big sellers are the ones who have bought stocks prior to March 2020 (pre-COVID19 season) and are currently selling at a MASSIVE PROFIT!

 And after this, guess which stocks will they be putting their massive gains of big RM stocks into?

Answer: The Sanitizers. 

The Specific Answer: ANCOM/4758 & NYLEX/4944

New NYLEX Investors will mimic the ranging bull as the price soars to max limit (limit up) price from Friday, 7 Aug 2020 onwards.

 

i) ANCOM/4758 - limit up from RM0.995 to RM1.30

ii) NYLEX/4944 - limit up fron RM0.84 to RM1.14

 

 

(i) Hexza /3298

manufactures ethanol that is the basic ingredient of hand sanitizers, commercial sanitizers.

(ii) Nylex /4944

Another potential candidate for limit up

Only 2 big manufacturers of ethanol, food grade, chemical grades in KLSE

 Hexza is in Tasek, Ipoh at the main road juncture to Penang- old main trunk road. (size 10 acres)

Fempro (subsidiary of Nylex) is based in Chuping, Perlis (size is 11 acres). Almost the same size as Hexza.

 Also , there are a proliferation of facemask and sanitizer retail companies due to Covid19.

Many of these newbies are just starting- up and they have not even purchased their lands for building the factories for 

their respective manufacturing processes.

 

For Ancom, it is already a long established player and manufacturer in the sanitizer field.

 

Ancom 48.95% subsidiary company,

Nylex already has a specific  - Fermpro factory that daily is  producing Ethanol for many years. 

 

And there is low entry level for face mask productions.

 There is high financial barrier to enter for Ethanol - big plant for production.

 

To manufacture ethanol, the company essentially

 MUST first secure a big piece of land of at least 10 acres size.

 

Not only that , it MUST be located at source of sugarcane as it is the feed stock for ethanol production.

 

So, Fermpro factory is located  in Chuping,

 is the perfect location as Chuping town ,Perlis.

 As Chuping town has the biggest sugar cane plantation in Malaysia.

 

Now,  Ancom is adding value to ethanol by converting and packaging it for sale as the end product- SANITIZER.

 

With average cost of RM25 to RM30 for a 500ml bottle of sanitizer.

Just imagine,  the gross profit from Fermpro

 5 million litres of ethanol will amount to BIG,BIG, BIG RM.

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You would not need to use the above 3 equipments as we have done research for you.

 

SUMMARY

SEE RESEARCH TARGET PRICES

FOR NYLEX: 

RM 1.20 short term,

RM 1.60 mid term

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FOR ANCOM: 

RM 1.10 short term,

RM 1.50 mid term

Key Abbreviations:

1. Ancom Berhad - is the holding company of Nylex (Malaysia). Berhad and Ancom Logistics Berhad, both are listed on the Bursa Malaysia Securities Berhad Main Board and ACE Market respectively.

2. Entopest Environmental Services Sdn Bhd (wholly-owned subsidiary of Ancom Berhad).

3. Fermpro Sdn Bhd (subsidiary of Nylex Berhad) Nylex Malaysia Berhad.