FUN FACT

Malaysia glove stocks today are greatly undervalue, trading at single PE or FPE, and also the safest investment. If the stock market crash tomorrow or in very near future, most stocks will tumble and fall-off the edge while glove counter (though may be affected moderately at first but will continue to climb with the promising earnings at least in the next 2 - 3 years, cash rich (thus can easily finance the expansion plan even if banks are tightening the lending and consolidating its position to cushion the high bankruptcy and NPL) and continue the glove demand uptrend at average 15.9% CAGR till 2025.

Unless we did not notice, Malaysia economy is not doing good while most businesses are suffering, thus despite of widespread Covid cases (almost averaging 100X compared to 1st or 2nd wave), government had allowed almost all if not all businesses to operate. Malaysia government can't afford much direct fiscal (or no money per se).

FUN FACT

1) As per Frost and Sullivan market study, the glove demand will see an average 15.9% CAGR or growth rate till 2025, that is from around 600 billion pcs annually to close 1,300 billion pcs in 2025. There are already more than 200 billion gloves shortage globally in Oct 2020, prior to Global Second Wave which have seen cases spike 10X - 20X. Manufacturers across the world are struggling with this 15.9% organic growth annually, let alone catching up with the acute global shortage. It will take at least 2 to 3 years to close the gap.

Sales revenue will grow from US$8.7B (in 2019) to US$24.9B (2025). Glove industry is on uptrend, and it is prudent for the bosses to reinvest to grow the production to catch on with this 15.9% CAGR (or more) and to catch up with the global shortage resulting from Covid.

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https://www.nbcnews.com/politics/politics-news/trump-admin-woefully-behind-stockpiling-medical-gloves-covid-19-surges-n1245298 Oct 30 2020

The synthetic rubber “nitrile” gloves are a critical barrier to infection for health care workers on the front lines, but experts say the United States is poorly positioned to get ahead of a global shortfall of more than 200 billion.

FUN FACT

The efficacy of the vaccine varies from one geographical area to another and may be due to different virus strain. From the data collected by vaccine makers (i.e. Novavax, J&J, Sinopharm, etc) which have conducted trials in different countries, the efficacy varied greatly with some seeing as low as 49% in Africa against 89% in UK e.g. Novavax. Another question is how long will the antibody last? And, when the new strain will strike as well as how fast Covid is mutating?

Manaus, Brazil which was being praised for achieving herd immunity by natural infection is seeing a surge in hospitalization after a lapse of 7 months. Reinfection is taking place and some individual was seen infected by 2 different strain at the same time.

https://www.economist.com/the-americas/2021/01/23/a-brazilian-city-thought-it-had-herd-immunity-it-was-wrong

Though we hope to see an everlasting high efficiency vaccine, heightened hygiene will be in place till the pandemic is declared over by WHO. That will likely not happen till 2024 onwards when broad population were vaccinated. For now, there'll be structural change in the hygiene practices in all countries (be it whether they have achieve herd immunity or not) unless they lockdown its own economy and close the door to the world. In short, glove manufacturer will enjoy average 15.9% CAGR organic growth + higher ASP in view of the persisting global shortage that may take at least 2 - 3 years to close the gap.

FUN FACT

The efficacy of the vaccine varies from one geographical area to another and may be due to different virus strain. From the data collected by vaccine makers (i.e. Novavax, J&J, Sinopharm, etc) which have conducted trials in different countries, the efficacy varied greatly with some seeing as low as 49% in Africa against 89% in UK e.g. Novavax. Another question is how long will the antibody last? And, when the new strain will strike as well as how fast Covid is mutating?

Manaus, Brazil which was being praised for achieving herd immunity by natural infection is seeing a surge in hospitalization after a lapse of 7 months. Reinfection is taking place and some individual was seen infected by 2 different strain at the same time.

https://www.economist.com/the-americas/2021/01/23/a-brazilian-city-thought-it-had-herd-immunity-it-was-wrong

Though we hope to see an everlasting high efficiency vaccine, heightened hygiene will be in place till the pandemic is declared over by WHO. That will likely not happen till 2024 onwards when broad population were vaccinated. For now, there'll be structural change in the hygiene practices in all countries (be it whether they have achieve herd immunity or not) unless they lockdown its own economy and close the door to the world. In short, glove manufacturer will enjoy average 15.9% CAGR organic growth + higher ASP in view of the persisting global shortage that may take at least 2 - 3 years to close the gap.

FUN FACT

https://www.nbcnews.com/politics/politics-news/trump-admin-woefully-behind-stockpiling-medical-gloves-covid-19-surges-n1245298

The synthetic rubber “nitrile” gloves are a critical barrier to infection for health care workers on the front lines, but experts say the United States is poorly positioned to get ahead of a global shortfall of more than 200 billion.

FUN FACT

As per Frost and Sullivan market study, the glove demand will see an average 15.9% CAGR or growth rate till 2025, that is from around 600 billion pcs annually to close 1,300 billion pcs in 2025. There are already more than 200 billion gloves shortage globally in Oct 2020, prior to Global Second Wave which have seen cases spike 10X - 20X. Manufacturers across the world are struggling with this 15.9% organic growth annually, let alone catching up with the acute global shortage. It will take at least 2 to 3 years to close the gap.

Sales revenue will grow from US$8.7B (in 2019) to US$24.9B (2025). Glove industry is on uptrend, and it is prudent for the bosses to reinvest to grow the production to catch on with this 15.9% CAGR (or more) and to catch up with the global shortage resulting from Covid.

FUN FACT

Malaysia glove stocks today are greatly undervalue, trading at single PE or FPE, and also the safest investment. If the stock market crash tomorrow or in very near future, most stocks will tumble and fall-off the edge while glove counter (though may be affected moderately at first but will continue to climb with the promising earnings at least in the next 2 - 3 years, cash rich (thus can easily finance the expansion plan even if banks are tightening the lending and consolidating its position to cushion the high bankruptcy and NPL) and continue the glove demand uptrend at average 15.9% CAGR till 2025.

Unless we did not notice, Malaysia economy is not doing good while most businesses are suffering, thus despite of widespread Covid cases (almost averaging 100X compared to 1st or 2nd wave), government had allowed almost all if not all businesses to operate. Malaysia government can't afford much direct fiscal (or no money per se).

FUN FACT

Malaysia glove stocks today are greatly undervalue, trading at single PE or FPE, and also the safest investment. If the stock market crash tomorrow or in very near future, most stocks will tumble and fall-off the edge while glove counter (though may be affected moderately at first but will continue to climb with the promising earnings at least in the next 2 - 3 years, cash rich (thus can easily finance the expansion plan even if banks are tightening the lending and consolidating its position to cushion the high bankruptcy and NPL) and continue the glove demand uptrend at average 15.9% CAGR till 2025.

Unless we did not notice, Malaysia economy is not doing good while most businesses are suffering, thus despite of widespread Covid cases (almost averaging 100X compared to 1st or 2nd wave), government had allowed almost all if not all businesses to operate. Malaysia government can't afford much direct fiscal (or no money per se).

FUN FACT

No of shares : 2.721 billion

FYQ12021 (Ju1 30 - Sep 30 2020) PAT : RM810M
FYQ22021 (Oct 1 - Dec 31 2020) PAT : RM1,070M*
FYQ32021 (Jan 1 - Mar 31 2021) PAT : RM1,600M, assuming +30% following TG guideline
FYQ42021 (Apr 1 - Jun 30 2021) PAT : RM1,600M

* The Profit After Tax (PAT) could have touched RM1,300M if not for additional RM270M "Other Cost and Expenses" which is likely associated with one time donation to Malaysia government, foreign worker remediation fee, Covid-19 related expenses, etc.

Total PAT for FY2021 is 5,080M, thereby Earning Per Share (EPS) is 5.080B / 2721 B = 1.87.

NOTE : The above calculation disregarding additional 10.25 billion gloves which will be added to existing production capacity progressively till end of CY2021, thereby the suggested number above is very likely far below actual. Existing capacity is 26.175, thus 10.25 billion would translate to approx +40% capacity.

At RM6.80, the Forward P/E is 6.80 / 1.87 = 3.6, which is ridiculously low. If following CIMB-CGS suggested 15 P/E, then the fair value is 15 x 1.87 = (RM28.05). Just hold for another quarter or two for handsome share appreciation, even if 50% discounted.

Again, this value is conservative as we have excluded +40% production capacity coming online progressively till CY2021 and ASP plateau from Apr 1 2021 onwards, though we expect ASP will continue to climb albeit at lower percentages. TopGlove latest ASP had already touch US$150/1,000pcs.

FUN FACT

1) As per Frost and Sullivan market study, the glove demand will see an average 15.9% CAGR or growth rate till 2025, that is from around 600 billion pcs annually to close 1,300 billion pcs in 2025. There are already more than 200 billion gloves shortage globally in Oct 2020, prior to Global Second Wave which have seen cases spike 10X - 20X. Manufacturers across the world are struggling with this 15.9% organic growth annually, let alone catching up with the acute global shortage. It will take at least 2 to 3 years to close the gap.

Sales revenue will grow from US$8.7B (in 2019) to US$24.9B (2025). Glove industry is on uptrend, and it is prudent for the bosses to reinvest to grow the production to catch on with this 15.9% CAGR (or more) and to catch up with the global shortage resulting from Covid.

------------------------------------------------------------------

https://www.nbcnews.com/politics/politics-news/trump-admin-woefully-behind-stockpiling-medical-gloves-covid-19-surges-n1245298 Oct 30 2020

The synthetic rubber “nitrile” gloves are a critical barrier to infection for health care workers on the front lines, but experts say the United States is poorly positioned to get ahead of a global shortfall of more than 200 billion.

Minority? How many supporter in your chat group? 1?

The last I checked, Top Glove Investors Discussion Telegram has over 43k members (in only 4 days).

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glovefinish Only the minority of u in denial mode, refuse to face and accept the truth still dreaming for not achievable high target price, dreaming for another bull come in glove counters, every day blaming so and so for the down of glove stocks and the undervalue of glove stocks, keep on talking about the increase of covid cases here and there and the bad news of vaccines to reinforce your confidence and hope.

However, the facts and reality of glove stocks in long term down trend no more bull unwanted and abandoned by most investors already happened against your wish, make u all very desperate, disappointed, hopeless and annoyed that every day scold and shout here and there like the mad people. All become cracy in whole life for the glove stocks.

Like it or not. We are in More Cases Only 2.0 (MCO2.0) and quite likely Continually More Cases Only (CMCO). BNM is likely cutting the OPR in 1H21 to historically low. Many more businesses are suffering or collapse. The big funds have to park in good prospect company and with promising earning. Where do you think that might be?

According to Harta, there is a short fall of 120B annually that may take at least 2 years to catch up.

And, this is what is reported by NBC.

----------------------------------------------------------------------

https://www.nbcnews.com/politics/politics-news/trump-admin-woefully-behind-stockpiling-medical-gloves-covid-19-surges-n1245298

The synthetic rubber “nitrile” gloves are a critical barrier to infection for health care workers on the front lines, but experts say the United States is poorly positioned to get ahead of a global shortfall of more than 200 billion.

----------------------------------------------------------------------

If the Covid cases persist albeit much lower number or reduced by 90% thus back to first global wave, the supply and demand gap will take many more years to close.

When you read the news, you need to ask yourself how did JPM derive the Target Price (TP) for Harta and Topglov. This is how JPM came out with such ridiculous low target price as compared to other IBs. The following is JPM estimate Profit After Tax (PAT) for Hartalega and Top Glove.

Hartalega (TG)

FY21 (Apr 1 2020 - Mar 31 2021) PAT RM2,905M

FY22 (Apr 1 2021 - Mar 31 2021) PAT RM1,622M

Topglove (TG)

FY21 (Sep 1 2020 - Aug 31 2021) PAT RM11,674M

FY22 (Sep 1 2021 - Aug 31 2021) PAT RM1,686M

So, first of all, Harta just reported RM1B+ PAT, and accumulative PAT to-date is around RM1.8B. And, Harta Average Selling Price (ASP) is about half of its peers meaning it can raise the ASP by 100% but it hinted it will raise 40% to 50% ASP in next quarter, as such the estimated PAT may be RM1.6B, thereby total PAT in FY21 (or till Mar 31 2021) is RM3.4B which is more than JPM est. of RM2.9B, not bad, even though closer to 20% off.

Now, then we ask ourselves is the projected RM1.6B for FY22 realistic? Quite likely Harta will raise the ASP to match its peer in Q1FY22, thereby RM2B is achievable. That is too say, the first quarter of FY22 alone is already more than JPM estimate for the entire FY22.

And, if you look at JPM estimate for TG, they expect TG PAT to increase or rather sustainable till at least Aug 31 2021. TG first quarter PAT is RM2.4B, thereby RM11.674B - RM2.4 = 9.274B and divide by 3 quarters = approx. RM3.1B which is the average PAT for TG in the next 3 quarters till Aug 31 2021. Even though we expect TG PAT would be 10% higher than JPM estimate, but going by JPM logic, TG PAT is on uptrend or rather sustainable till at least Aug 31 2021.

Aug 31 2021 would translate to 2 quarters into FY22 for Hartelga. So, Hartalega will enjoy 2 consecutive quarters uptrend going into FY22. First quarter already RM2B and assuming second quarter remain the same, that would have had been RM4B PAT as compared to JPM estimate of RM1.6B for the entire FY22.

Jeffrey Ng, who is JPM analyst had only joined JPM in second half of 2020 and had no prior experience with healthcare or glove industry. Evidently, his analysis is totally off the chart. He had since deleted his profile in Linkedin and gone in hiding.

https://www.nbcnews.com/politics/politics-news/trump-admin-woefully-behind-stockpiling-medical-gloves-covid-19-surges-n1245298

The synthetic rubber “nitrile” gloves are a critical barrier to infection for health care workers on the front lines, but experts say the United States is poorly positioned to get ahead of a global shortfall of more than 200 billion.

------------------------------------------------------------------------

Even with vaccine, it will take at least 2 years to fill the global shortage of more than 200B pcs annually, not taking into consideration of 15% to 20% annual organic growth. If vaccine is not performing as anticipated, then the shortage will get worse instead of closing the gap.

If no of cases may reduce by 90%, we are still back to the Global First Wave number and this is not helping the economy, only temporarily relief from the current Super-Wave.

The prevailing results from vaccine maker which carry out trials in multiple countries like Sinopharm, Novavax, J&J, etc indicate that the efficacy vary greatly from one country to another with the lowest efficacy shown in Africa study at merely 49% efficacy (as in Novavax case). The vaccine may not be effective against different variants seen in other geographical area and these variants may be the dominant one in very short time, not to mention the virus is mutating at the speed of light. Higher number of reinfection cases are also seen in Brazil after a lapse of 7 months.

1> Deeper pocket? Yeah right. Holding millions of losses and risk department is barking while being screwed by the boss every day, can the related investment banker sleep well at night? They have SOP in place and need to cut loss when the share price surge beyond the threshold, which is likely not too far. On the other hand, how much more can they short? 1%? limited bullets!

2> Stamina? How long can they hold? The bad news is no more than one quarter as they need to show good quarterly result. Better move to other counter to short, to cover the losses on TG. Further, they need to pay monthly fees on the shares lending as well as dividend payout.

The investment banker need to go to work, looking at the screen everyday, report and show result while we can park the money there and wait patiently because we answer to ourselves.

More Cases Only 2.0 (MCO2.0). The total number of cases for last couple days is more than the cumulative no. of cases from Jan to early Nov 2020.

Stay put with your investment and stay safe!

"Stock market is a device to transfer money from the impatient to the patient" - Warren Buffet.

What you have in hand is rock-solid "undervalue" World Clsss Glove maker that export to over 160 countries and enjoying the highest margin with OBM model, not a fading business.

US owned glove maker http://www.americanperformancepolymers.com/ is pale in comparison to Malaysia glove-maker. Very small setup and outdated technology that can probably make less than 10k gloves per hour per line as compared to ours i.e. 45k to 50k per line per hour. And we will have more automation, IR4.0, IOT, etc in place very shortly. We also have the technology to make the lightest glove whereby others are playing catching-up and we'll go to US to show them how to make a proper glove.

More Cases Only 2.0 (MCO2.0). The total number of cases for last couple days is more than the cumulative no. of cases from Jan to early Nov 2020.

Stay put with your investment and stay safe!

"Stock market is a device to transfer money from the impatient to the patient" - Warren Buffet.

What you have in hand is rock-solid "undervalue" World No.1 Glove maker in the world that export to 195 countries, not a fading business.

US owned glove maker http://www.americanperformancepolymers.com/ is pale in comparison to Malaysia glove-maker. Very small setup and outdated technology that can probably make less than 10k gloves per hour per line as compared to ours i.e. 45k to 50k per line per hour. And we will have more automation, IR4.0, IOT, etc in place very shortly. We also have the technology to make the lightest glove whereby others are playing catching-up.

<<Business101>> Not promoting vaccine but just to paint a more realistic picture whereby EIU projects only 60% will be vaccinated by end of 2022 as oppose to a more optimistic projection by our government i.e. 80% by Q1 2022. By then, also we do not know whether it is effective against prevailing variants.

The total number of cases for last couple days is more than the cumulative no of cases from Jan to Nov 2020. Do you trust the government? What we have today is More Cases Only 2.0

-------------------------------------------------------

Business101 Why promote vaccine here?
30/01/2021 6:15 PM

<<menotassassin>> JPM almost collapse in 2008 financial crisis. During this crisis, we presume the Risk Department is tightening its procedure and keeping a close eye like other banks. Investment Department is probably shaking and if the low-side is limited (since only 1% RSS left on TG) while the upside is raging, they'll have to cut loss and quickly cover the short. Theoretically, they can hold for a long time, but from the internal quarterly performance and risk assessment point of view, they have to answer to Risk Department (and Bosses) while struggling to show good result thus will not do that. At the same time, they have to shoulder the associated monthly fees and dividend payment for the shorts.

In brief, when the risk is high or above the threshold, they have to cut loss and cover the short immediately, otherwise when the quarterly performance review come, they may also have to cut to move onto more potential short position in other counter.

Time is not on JPM side, as more bombastic quarterly result (thus more upside) + dividend will be declared in Mar 2021.

That is the problem with this Investment Banker whereby their performance is being assessed on quarterly basis and they have to abide by the internal Standard Operating Procedure (SOP), thus they can't hold onto it for a long time, unlike medium-to-long term investor like us.

------------------------------------------------------------

menotassassin Let me explain what happen to GME and why it is possible for Top Glove.

In simple term, GME stock is over shorted, the amount shorted is more than the available volume in market, so reddit users noticed it, and plan the attack. They buy and hold, forcing the short sellers to buy back. And even until now, the short position is not yet fully covered.

Why it is possible for Top Glove?
Because RSS limit is 4%, and it is very near the limit now! Once the limit is reached, then short sellers have no other way to push the price down! They can hold forever, but then they have to pay interest and also dividen! So time is not with them!

Feel free to copy and share out!
30/01/2021 11:13 PM

JPM is not god. They almost collapse in 2008 financial crisis. During this crisis, we presume the Risk Department is tightening its procedure and keeping a close eye like most banks. Investment Department is probably shaking and if the low-side is limited (since only 1% RSS left on TG) while the upside is raging, they'll have to cut loss and quickly cover the shorts. Theoretically, they can hold for a long time, but from the quarterly performance and risk assessment point of view, they have to answer to Risk Department (and the bosses) while struggling to show good result thus will not hold for long. At the same time, they have to shoulder the associated monthly fees and dividend payment for the shorts.

Time is not on JPM side, as more bombastic quarterly result (thus more upside) + dividend will be declared in Mar 2021.

That is the problem with this Investment Banker whereby their performance is being assessed on quarterly basis, thus they can't hold onto it for a long time (esp. when they are holding hundred of millions paper-loss), unlike medium-to-long term investor like us.

<<investmalaysia>> There are even many times TSLWC did not buy and the share price goes up, up and up. There are many forces out there trying to shake the weak-holder, creating fake news, negativity, panic sell, press down the price, accumulate at cheap price and then reap the big profit when the share price goes up. Anyone including TSLWC can buy at any given time if he/she perceive the share is undervalue, hold and wait for it to appreciate.

Even there are times when banks in America are buying back the shares massively, yet the share price slip but recover eventually and appreciate thereafter. No one can predict the actual movement of the share-market.

"The market is a device for transferring money from the impatient to the patient" - Warren Buffet

How many bosses out there walk-the-talk, spending millions and billions buying back their share instead of cashing out, if they are not confident in their own businesses. Why keep the cash to earn meagre percentages from FD if you are confident that it will appreciate much much more.

Think of investment as being a business partner or shareholder and not gambling den or pretend to be smart that you know it all and can tell the actual market movement. Dream on!

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investmalysia Tan Sri used to buy RM70 million worth of shares everyday for almost a month. That time topglove was around RM7 something if not mistaken. Yet topglove share price still drop to RM6. Why is that so? Think about it.
30/01/2021 9:49 PM

<<cheif999>>> The estimated RM270M is taken from the difference between this quarter and average last quarters. RM75M is donation to government, others are like foreign worker remediation fee, Covid-19 related expenses, etc.

------------------------------------------------------------

chief999 Chasebro, u sure 270m? Where u get the info? I tot 75m?
RM270M "Other Cost and Expenses"
30/01/2021 6:36 PM

<Pgraduate123> We can't guess and we can't tell. If we can, we wouldn't be here. QR announcement does not guarantee share price will shot up the next day like recent bank and tech stock in US. And it does not mean the share goes in the same direction or exact quantum, otherwise, the chart would have been up, up and up. Up and down is normal.

If you are short term trader, use your chart and technical analysis as well as trading strategy as yr guide i.e. percentages of profit and cut loss. If you are investor, please refer to fundamental analysis and set your investment strategy.

Understand well your personality and adopt the right trading/investment strategy. If you are the type that has to be right day-after-day like Trump, then you'll be screwed.

------------------------------------------------------------

Pgraduate123 1 Billion profit like hartataklega rm90.60 sen kopi O and roti bakar so it plunged next day.
Supermin now also 1 billion but give you rm30.80 sen for kopi O kosong.
Guess what happens on Tuesday
30/01/2021 6:21 PM

No of shares : 2.721 billion

FYQ12021 (Ju1 30 - Sep 30 2020) PAT : RM810M
FYQ22021 (Oct 1 - Dec 31 2020) PAT : RM1,070M*
FYQ32021 (Jan 1 - Mar 31 2021) PAT : RM1,600M, assuming +30% following TG guideline
FYQ42021 (Apr 1 - Jun 30 2021) PAT : RM1,600M

* The Profit After Tax (PAT) could have touched RM1,300M if not for additional RM270M "Other Cost and Expenses" which is likely associated with one time donation to Malaysia government, foreign worker remediation fee and Covid-19 related expenses.

Total PAT for FY2021 is 5,080M, thereby Earning Per Share (EPS) is 5.080B / 2721 B = 1.87.

NOTE : The above calculation disregarding additional 10.25 billion gloves which will be added to existing production capacity progressively till end of CY2021, thereby the suggested number above is very likely far below actual. Existing capacity is 26.175, thus 10.25 billion would translate to approx +40% capacity.

At RM6.80, the Forward P/E is 6.80 / 1.87 = 3.6, which is ridiculously low. If following CIMB-CGS suggested 15 P/E, then the fair value is 15 x 1.87 = (RM28.05). Just hold for another two quarters for handsome share appreciation, even if 50% discounted.

RM11.80 is already discounted by 58% in coming 2 quarters. Fund managers would find it irresistible and reallocate the fund in due time. Wait for Supermax SGX listing and surprise announcement of US venture under Biden initiative, which is expected in early part of Biden first 100-day.

<<williamh>> Not only that, SC and Bursa will suspend all counters on Monday. It's FT day (holiday).

-------------------------------------------------------------

williamh SC n Bursa had warned and likely will suspend those glove counters Monday any discussion groups is an offence trying to manipulate, don’t be lured my the greedy.
30/01/2021 3:31 PM

Hmmm..... this Aminvest is deliberately giving very low TP. Maybe because 2 upcoming warrants expiring in Mar 2021 with strike value at RM14.00 and RM16.50 respectively.

Harta already reported RM1B PAT in 3QFY21 and that could have been higher if not for one time RM90M donation to Msia government.

FY21 to-date already earned accumulative of around RM1.8B, and all knew that the upcoming quarter will see another 40% to 50% increase in ASP, yet Aminvest only revise the estimation for the full FY21 PAT to RM2.8B or indirectly suggesting the upcoming quarter which is also last quarter of FY21 will see around RM1B PAT only which is a blatant lie. Others are giving a more realistic projection i.e. RM3.3B for full FY21, ending Mar 31 2021.

Also, Aminvest estimated RM2.7B PAT in FY22 (Apr 1 2021 to Mar 31 2022), while Harta already shared the fixed volume allocation as well as spot order already fully booked for next 12 months, which could potentially see RM2B PAT per quarter from June 1 2021 onwards. Other analysts have estimated between RM6B to RM7B PAT in FY22 which is more realistic.

So, it is very easy to validate whether Aminvest suggested Target Price (TP) as well as projected PAT in FY21 and FY22 is realistic, otherwise a joke.

Remember this analyst >>> Thong Pak Leng, thong-pak-leng@ambankgroup.com, 03-2036 2025

<<Agjl>> Just download Telegram as how you download Whatsapp, Link or alike. Follow the setup instructions.

Once done, click the magnifying glass on the top right, and type in "Top Glove Investors Discussion". Tap on "Top Glove Investors Discussion" and click "Join". Maybe can seek assistant from neighbor if you have difficulty with installing Telegram. Cheers!

Malaysia has thus far inked vaccine agreements with COVAX, Pfizer and AstraZeneca to cover 57.9% of its population while the remaining supply is expected to come from Sinovac, CanSino and Gamaleya. Based on inked agreements and adjusted for demand (i.e. 2/3rds of Malaysians surveyed said they will take the vaccine), we estimate that Malaysia can inoculate 25.8% of its population by end-2021. The government has set a rather ambitious target at 80% of population by 1Q22 but some external estimates are lower; e.g. The Economist Intelligence Unit (EIU) projects 60% by 4Q22

Source ; HLG 29 Jan 2021

Malaysia has thus far inked vaccine agreements with COVAX, Pfizer and AstraZeneca to cover 57.9% of its population while the remaining supply is expected to come from Sinovac, CanSino and Gamaleya. Based on inked agreements and adjusted for demand (i.e. 2/3rds of Malaysians surveyed said they will take the vaccine), we estimate that Malaysia can inoculate 25.8% of its population by end-2021. The government has set a rather ambitious target at 80% of population by 1Q22 but some external estimates are lower; e.g. The Economist Intelligence Unit (EIU) projects 60% by 4Q22

Source ; HLG 29 Jan 2021

Malaysia has thus far inked vaccine agreements with COVAX, Pfizer and AstraZeneca to cover 57.9% of its population while the remaining supply is expected to come from Sinovac, CanSino and Gamaleya. Based on inked agreements and adjusted for demand (i.e. 2/3rds of Malaysians surveyed said they will take the vaccine), we estimate that Malaysia can inoculate 25.8% of its population by end-2021. The government has set a rather ambitious target at 80% of population by 1Q22 but some external estimates are lower; e.g. The Economist Intelligence Unit (EIU) projects 60% by 4Q22

Source ; HLG 29 Jan 2021

<<ProsperousRealm>> What is more worrying is not J&J efficacy as it can be seen that the efficacy vary greatly from one country to another country esp. Novovax where it could fall below 50% in Africa. And, the earlier high efficacy associated with Pfizer and Moderna are largely conducted in America but new variants are emerging from everywhere, thus actual efficiency may be grind down to insignificant as time passes and mutation is accelerated and re-infecting the existing population.

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ProsperousRealm Johnson & Johnson vaccine only 66% effective

https://www.statnews.com/2021/01/29/jj-one-dose-covid-vaccine-is-66-ef...
30/01/2021 7:45 AM

https://www.bloomberg.com/news/articles/2021-01-30/covid-mutations-undercut-optimism-even-as-more-vaccines-get-near?srnd=premium-asia

In laboratory results reported before the new Novavax and Johnson & Johnson trial data was in, researchers from the Aaron Diamond AIDS Research Center at Columbia University found that the Pfizer and Moderna vaccines were 6.5 to 8.6 -fold less potent against the South Africa mutation.

“Looking at our results you cannot say this would doom the vaccine. That would be wrong. But I think it is equally wrong to say everything is rosy.” said virologist David Ho, who leads the lab. ”We allowed the virus to infect 100 million people already, so that is 100 million chances for mutation.”

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In my opinion, the Covid has infected far more than 100 million people already, just that it was gone undetected because majority cases are asymptomatic unlike Influenza, SARS, MERS, Ebola, etc.

There is no way to eradicate Covid-19 for now but hopefully in coming years. Scientist still do not understand it well. Even if the number of cases were reduced by 90% or more, it is still high and demand for glove will remain or even increase further with more industries start to operate e.g. hotel, tourism, etc and adopting more stringent hygiene practices. Just interpolate from the 9/11 incident where heighten security was in place throughout the world for some years. Covid-19 has cost the world US$28 trillion and millions of precious lives. You do not want some new unknown variant sneak-in and wreak havoc to your country and economy till you are assure you have all the proper measures in place and that may be some years down the road.

No of shares : 2.721 billion

FYQ12021 (Ju1 30 - Sep 30 2020) PAT : RM810M
FYQ22021 (Oct 1 - Dec 31 2020) PAT : RM1,070M*
FYQ32021 (Jan 1 - Mar 31 2021) PAT : RM1,600M, assuming +30% following TG guideline
FYQ42021 (Apr 1 - Jun 30 2021) PAT : RM1,600M

* The Profit After Tax (PAT) could have touched RM1,300M if not for additional RM270M "Other Cost and Expenses" which is likely associated with one time donation to Malaysia government, foreign worker remediation fee and Covid-19 related expenses.

Total PAT for FY2021 is 5,080M, thereby Earning Per Share (EPS) is 5.080B / 2721 B = 1.87.

NOTE : The above calculation disregarding additional 10.25 billion gloves which will be added to existing production capacity progressively till end of CY2021, thereby the suggested number above is very likely far below actual. Existing capacity is 26.175, thus 10.25 billion would translate to approx +40% capacity.

At RM6.80, the Forward P/E is 6.80 / 1.87 = 3.6, which is ridiculously low. If following CIMB-CGS suggested 15 P/E, then the fair value is 15 x 1.87 = (RM28.05). Just hold for another two quarters for handsome share appreciation, even if 50% discounted.

<<DSIVANP>> Just search for "Top Glove Investors Discussion" in Telegram and Join. There are close to 40k members already in 1 day+. There are other forums too like "Bursabets" and 'Malaysia Glove Union" but the former is the largest.

<<ToneeFa>> Yes, agreed. It is not a matter of dividend but what they are doing with the profit. It is better to reinvest and cement its foothold than giving out high dividend or SBB when the future prospect is superb. Harta also conceived its unplanned NGC1.5 sometime in mid 2020 and this may cost RM1.5BM and churn out additional 19 billion gloves while commissioning will start towards Q4 2021.

- Targeted investment for 5 new Malaysia plants is RM1.39B with additional 22.2 billion gloves or +85% production capacity
- US$550M for US Plant Phase 1 and Phase 2. Even though the actual production capacity is not revealed but interpolating from the Malaysia plant, it would be probably no less than 20 billion. More than 50% of present Supermax market is US.
- £50M for UK Plant to cater Europe market

The share price appreciation for Supermax shall be greater compared to its peers.

Look at this pathetic, the only American owned glove manufacturer in US (American Performance Polymers) http://www.americanperformancepolymers.com/about/

The setup is so old and inefficient, very likely capable of producing less than 10k/hr/line as compared to today's technology capable of producing 45k-50k/hr/line. Probably it can only churn out 100+ million pcs annually. A far cry from Supermax multi-billion capacity.

When it comes to glove production, Malaysia is ahead of the rest. And let us show them first class glove manufacturing facility and technology.

P/S : Don't equate Top Glove to Supermax and especially Harta manufacturing facility because the latter is highly automated and adopting IR4.0, IOT.

<<abdullah53>> I have had worked in US for quite a while but for a Taiwanese company. Most employees including factory workers are not Angmo but Mexican, Asians, Latin American. The factory is mostly in remote area or remote town. Also, I believe it would be more automation. Quite easy to manage despite tougher labor law.

By the way, the 5 new factories coming in this 2 years are referring to Malaysia case only, excluding US case.

Congrats to all glove supporter! U guys are in the news today for a good reason. Something to remember by and be proud of. The share is greatly undervalue. Just remember that :-

1> Demand is more than supply by a quantum of 120billion for at least 2 years. Demand increase by 15% - 20% y-o-y. Higher and higher earning in coming quarters. If you think RM1B+** is a lot, wait till you see what is installed in coming quarters. "Highest ASP have not been reflected in current quarter" as taken from today's interim financial statement.

**Please note that there was an additional RM270M incurred under category of "Other Cost & Expenses" and quite likely one-off cost. Otherwise, PAT may be close to RM1.3B. So, that would give you a hint on the PAT in coming quarters with even higher ASP, and with additional capacity coming online progressively i.e. from approx 26 billion pieces to 36.5 billion pieces.

2> King of OBM model, *** huge profit margin ***. Highest among its peers, significantly higher or more than 20%.

NOTE : Theoretically, Manufacturer price is merely 20% of market price while Distribution is about 80% of market price. With OBM model, Supermax is making distribution income as well which is several times higher than manufacturer's margin per se.

3> Production will increase to around 36.5B by end of 2021 as compared to 21.7B in 2019 or pre-Covid, and eventually 48.5B by end of 2022. That is almost 2.2X compared to pre-Covid (excluding additional huge capacity coming fom US/UK).

4> New Beyond Mask business in Canada, that will set the standard in mask industry, just started in Q4 2020.

5> US$550M glove factory in US to capitalize the "Make in US" glove, thus sustainable high margin business model. 50M pound factory in UK to supply to Europe.

6> Improve plant efficiency, reduced labor, thus improve profit margin.

7> Adoption of energy efficient system (biomass) and Solar, thus improve profit margin.

Utility or energy and labor are the next 2 biggest cost contributor apart from the raw material (latex/butadine)

8> SMETA/SEDEX member, audited and certified. ESG is gaining importance in stock valuation.

This company is cash rich. Single P/E, high profit margin, growing capacity, bright future with overseas expansion and entrants in new product/technology. US alone account for more than half of Supermax market, at present. It has all the criteria to attract foreign funds.

<<noobinvestor98>> Harta production capacity coming to 44 billion while Supermax is only 26 billion. Also, in this quarter, Supermax incurred additional RM270M under "Cost and Other Expenses", otherwise maybe close to RM1.3B PAT. Let's dig further to see what is the additional expenses and quite likely it is one time expense.

<<FairNSquare>> You can find the info on the upcoming 5 plants to be coming online till end of 2022 at the following link : https://koonyewyin.com/2020/10/31/supermax-analyst-briefing-slides-q1-fy2021/

That will contribute additional 22 billion gloves of additional 85% capacity, 10 billion within CY2021 and 12 billion within CY2022.

Congrats! U guys are in the news for a good reason. Something to remember by and be proud of. The share is greatly undervalue. Just remember that :-

1> Demand is more than supply by a quantum of 120billion for at least 2 years. Demand increase by 15% - 20% y-o-y. Higher and higher earning in coming quarters. If you think RM1B+ is a lot, wait till you see what is installed in coming quarters.

2> King of OBM model, *** huge profit margin ***. Highest among its peers, significantly higher or more than 20%.

NOTE : Theoretically, Manufacturer price is merely 20% of market price while Distribution is about 80% of market price. With OBM model, Supermax is making distribution income as well which is several times higher than manufacturer's margin per se.

3> Production will increase to around 36.5B 2021 comby end of compared to 21.7B in 2019 or pre-Covid, and eventually 48.5B by end of 2022. That is almost 2.2X compared to pre-Covid (excluding additional huge capacity from US/UK).

4> New Beyond Mask business in Canada, that will set the standard in mask industry, just started in Q4 2020.

5> US$550M glove factory tn US to captilize the "Make in US" glove, thus sustainable high margin business model. 50M pound factory in UK to supply to Europe.

6> Improve plant efficiency, reduced labor, thus improve profit margin.

7> SMETA/SEDEX member, audited and certified. ESG is gaining importance in stock valuation.

This company is cash rich. Single P/E, high profit margin, growing capacity, bright future with overseas expansion and entrants in new product/technology.

Congrats! U guys are in the news for a good reason. Something to remember by and be proud of. The share is greatly undervalue. Just remember that :-

1> Demand is more than supply by a quantum of 120billion for at least 2 years. Demand increase by 15% - 20% y-o-y. Higher and higher earning in coming quarters. If you think RM1B is a lot, wait till you see what is installed in coming quarters. Maybe RM2B or more.

2> Production will increase to around 68B in 2023 compared to 27B in 2019 or pre-Covid, and eventually 95B in 2027. That is almost 2.5X in 2023 and 4X in 2027.

3> RM4.5B to RM5B CAPEX for NGC1.5 and NCG2.0 may be covered by super-cycle earning, thus no debt or borrowing cost.

4> IR4.0 automation to reduce 20% labor and Energy efficient system (including Solar) to bring down the cost further, thus improve margin. Labor and fuel (or energy) are two biggest cost factor besides material i.e. latex/butadine.

5> Extend OBM model beyond India, China and Australia.

6> Proprietary Anti-Microbial Glove (AMG) is due to be approved by FDA and EN.

7> ESG, leader among its peers. ESG is gaining importance in stock valuation.

Based on the above, judge for yourself if the share price shall go up further (significantly) and whether it is sustainable or not? Est. RM7B+ PAT this calender year (not fiscal year), single digit 6 months FPE onwards, 5% dividend.

Apart from the conservative EPS, P/E and fair price as demonstrated yesterday, and also taking into consideration of annual shortage of 120 billion for at least coming 2 years, (thus ASP would remain high throughout), do take this into consideration in your own evaluation.

The capacity would have increased by 2.5X by 2023 as compared to pre-Covid and with foreseeable higher margin as well as lower cost (or in fact lowest cost among its peers) plus foreseeable approval on its proprietary AMG, don't be fooled that the share price will drop to pre-Covid level. Even Covid is able to bring under manageable level in 2 years time (in the most optimistic case of human-kind), today's share price is still undervalue. Not to mention the added bonus of 4% - 5% cash dividend.

I believe all the big funds have Harta in their portfolio including JPM.

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1) Production Capacity

2019 - 27 billion, or pre-Covid
2020 - 38 billion
2021 - 44+ billion
2022 - 56 billion (Plant No.8/9 NGC1.5 + Plant No.1 NGC2.0)
2023 - 68 billion (Plant No 9/10 NGC1.5 + Plant No.2 NGC2.0)

NOTE : NGC 1.5 (4 plants, 48 lines) with eventual capacity of 19 billion start commissioning towards Q4 CY2021 while NGC 2.0 (7 plants, 82 lines) with eventual capacity of 32 billions, start commissioning towards Q1 CY2022. Upon completion of NGC1.5 and NGC2.0, total production is 95 billion. Total CAPEX for NGC1.5 and 2.0 may be in the bound of RM4.5B to RM5B which may be easily taken care of by the earning from the super-cycle thus no or negligible debt (as well as borrowing cost).

2) OBM presence in India, China and Australia at the moment, and Harta commit to grow the OBM segment. This will improve its margin further.

3) Fully digitized production floor, higher level of automation (IR4.0), further reduction of labor of 20%, high energy efficiency Cogeneration system + Solar system with over 80% efficiency (anticipated to reduce 20% - 30% fuel cost). Apart from raw material, fuel and labor are the next largest cost component. This will improve the cost, likewise profit margin

4) Proprietary Anti-Microbial Glove (AMG) technology may receive FDA and EN approval within 2021, thus would command higher margin.

5) Excellent ESG

https://www.reuters.com/article/health-coronavirus-vaccine-access/china-indias-covid-19-vaccinations-to-stretch-to-late-2022-study-idUSKBN29W0DY

.......... more than 85 poor countries will not have widespread access to vaccines before 2023, a study showed on Wednesday.

https://www.reuters.com/article/health-coronavirus-vaccine-access/china-indias-covid-19-vaccinations-to-stretch-to-late-2022-study-idUSKBN29W0DY

.......... more than 85 poor countries will not have widespread access to vaccines before 2023, a study showed on Wednesday.

https://www.reuters.com/article/health-coronavirus-vaccine-access/china-indias-covid-19-vaccinations-to-stretch-to-late-2022-study-idUSKBN29W0DY

.......... more than 85 poor countries will not have widespread access to vaccines before 2023, a study showed on Wednesday.

<<UPlanet>> Fintec is a really interesting company. The company is running at lost, purely from own sales be it greentech, oil and gas service or trading. But, they have a super huge gain from investment securities. I do not study in depth neither knowing much of this company as well as its investment portfolio or if this will reduce to dust in an instance like in HKEX case, there is no limit down and the share can go bust in a single day which has had happened before.

If they are really good investment company, just quit Bursa, delist and just manage its own investment portfolio. Sorry, if this is not much of a help.

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UPlanet ChaseBros, very well analysis!!! But bro, can help to analyse Fintec counter, whereby now price only Rm0.08, PE 0.23 damn low, nta 0.91, recent PAT Rm750m close to SP Rm790m, why market still can accept it??? Thanks!
27/01/2021 4:10 PM

No of shares : 2.721 billion

FYQ12021 (Ju1 30 - Sep 30) PAT : RM812M
FYQ22021 (Oct 1 - Dec 31) PAT : RM1,100M
FYQ32021 (Jan 1 - Mar 31) PAT : RM1,100M
FYQ42021 (Apr 1 - Jun 30) PAT : RM1,100M

Total PAT for FY2021 is 4,112M, thereby EPS is 4.112B / 2711 B = 1.51.

Disregarding additional 2.2billion capacity from Plant #12 Block B, from present around 22 billion capacity or 10% increase, and further ASP increase, thereby the suggested number above is very likely below or far below than actual.

At RM6.50, the Forward P/E is 6.50 / 1.51 = 4.3, which is ridiculously low.

Some "smart-ass" suggested it will be pressed down to RM2 or around RM5.421B market cap against RM4.112B PAT by CY1H2021 or FYQ42021 which also translate to 1.31 P/E. Judge for yourself.

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Supermax All Time Average P/E is 12.32, thus fair price would be 12.32 x 1.51 = RM18.60, and even if it is discounted by 50%, that would be RM9.30.

Just hold for another quarter or two to see the appreciation.

NGC1.5 with 18.9 billion capacity will start commissioning by end of this year (2021). That would be additional 43% capacity from 44 billion capacity (when Plant No.7 is fully commissioned by Mar 2021). ASP remained high till at that point and can you imagine what is the profit like?, and dividend payout?

The P/E, PAT calculation demonstrated above is very conservative without taking into consideration of all this contribution.