Malaysian glove maker Hartalega says its 'priority' is to support existing customers

Jul 31, 2020

https://www.youtube.com/watch?v=vDhgdI4aPXI

Malaysian glove maker Hartalega says demand is 'still very high'

Jul 30, 2020

https://www.youtube.com/watch?v=X0vYHyEAnYw

Malaysian glove maker Hartalega says demand is 'still very high'

Jul 30, 2020

https://www.youtube.com/watch?v=X0vYHyEAnYw

If Australia, Spain, Japan...from almost nil cases with stringent prevention measures, now exploding with covid cases again....

i really wonder when U.S & brazil will ever be able to control these with daily cases exceeding 60k

their attitude, discipline level and needs of freedom is completely different than the above countries...

I cannot see them bringing down the cases to nil, and if they did...it will explode again within weeks when they are back to normal.

Unless vaccination for the whole complete population.

Think about it - its going to take years before that happens - when will every single person be vaccinated?

............

TG now screwed a big existing market (U.S) and potentially Australia too...god knows when UK will say the same, and i cant see this WRO uplifting anytime within the next 2 months...

Supermax should be the ultimate gainer.

Just like how now TG is in a position to allocate 20-30% of their output for spot orders - while certainly disappointing their dedicated buyers ...

Super had completely re-channeled all their output to their own distributor from external distributors earlier. Their OBM contribution is 100% to their own pocket.

If TG could do that as an OEM gradually, it was almost instantaneous - immediate for Super



Posted by freetospeak > Jul 31, 2020 2:28 PM | Report Abuse

Their direct customer database had increased by leaps n bound due to this crisis.they cant do that in the past.but now they can becoz of this crisis creating high awareness to their product. They increase their obm to 95%,they streamlined their obm n greatly increase margin.it will bring great value to their company n shareholders.

yes free, may be market is waiting for 'Super to show the prove' what margin they can make as an OBM....


Posted by freetospeak > Jul 31, 2020 1:43 PM | Report Abuse

Prob...we still need profit to bak up.if super can prove with super profit.the price gap will close up naturally.jus like harta is closing up to tg again with its coming qtr.

I think any distributor who buys from TG (as an OEM supplier) would want to at least share 50% of the OEM margin when they package it with their own Brand name and sells as an OBM....

if not they will surely squeeze the OEM margin

the above logic is the core of the above justification

actually TG capacity is 86 b/annum vs Super of 26b/annum

if you assume the OBM only retains a margin of 50% of OEM, the ratio on (1) above becomes 1.5

using 1.5 into (2) above, the equivalent gloves capacity of Super becomes:

= 26 x 1.5
= 39 b/annum
............

Super gloves capacity to TG becomes:

= 39/86
= 45%


Currently Super Mcap to TG is at 33%

To raise the ratio to match equivalent capacity, Super price should be:

= 45%/33% x 18.5 (super share price)
= 25

Again, it shows it should match TG price

the wonder....in a nutshell is... why havent trading price of super match TG as expressed by someone earlier as per below



Jul 25, 2020 2:08 PM | Report Abuse

actually one simple way of comparing Super with TG is this:
...........................................................

(1) decide what OBM margin is vs OEM

i see the ratio (OBM/OEM) ranges anywhere from 5 x , to the most conservative assumption giving 2 x.
Meaning if OEM make RM 0.10 per glove OBM makes at least RM 0.20 per glove.

(2) this margin difference can be represented as equivalent gloves.

For a minimum ratio of 2, the equivalent gloves capacity of Super will be double its existing versus topglove

as such Super effective capacity is 42 billion if topglove is at 90 billion. i.e about 50% of TG


(3) mcap of super versus topglove should reflect the equivalent gloves capacity

Current market cap of TG is 70 billion versus super of 23 billion

...............

based on (2) above, shouldnt super be having at least half the mcap of topglove? instead of less than 30% currently.

Super being OBM would have higher flexibility on spot orders which was shooting to 190usd per 1000 gloves in July....

being smaller, it has higher rate of expansion in capacity (growth) lesser constrained by workers unlike topglove...

further it had established its distributors at the key affected areas like Brazil and U.S....

I am still curious why the pricing has not catch up to TG

using the above arguments, super should be priced at 26 if topglove is at 26

In a nutshell, their price should match

it was intentionally sold down to match closing % drop of TG by those who cannot see the difference between Super & TG

the wonder had risen due to the fact that it was trading at positive 2 % relative to TG throughout the whole trading day up till a few min before closing..


Posted by ikansardin > Jul 31, 2020 1:11 PM | Report Abuse

I saw many people asking why close 18.50. Does that not suppose depend on ask n bid price? Or any specific rule or calculation its not suppose closed with 18.50? I'm newbie who just follow trend. Wondering myself, why many people wonder why its close 18.50. Maybe someone can share the reason of why it is not suppose 18.50

For TG shareholders, just monitor below to see the effects of Dow Jones

https://www.bloomberg.com/quote/TGLVY:US

Gloves is barely affected - it may turn out to be green.

FYI: If TG U.S trades at 25, TG Bursa should trade at (4.24/4) x 25 = 26.5

the 4.24 is USD to MYR exchange rate and the 4 is due to the fact 1 TG US shares is equivalent to 4 TG Bursa shares.

For TG shareholders, just monitor below to see the effects of Dow Jones

https://www.bloomberg.com/quote/TGLVY:US

Gloves is barely affected - it may turn out to be green.

FYI: If TG U.S trades at 25, TG Bursa should trade at (4.24/4) x 25 = 26.5

the 4.24 is USD to MYR exchange rate and the 4 is due to the fact 1 TG US shares is equivalent to 4 TG Bursa shares.

Top Glove expects to settle remediation with US Customs next month

https://www.theedgemarkets.com/article/top-glove-expects-settle-remediation-us-customs-next-month

..............

To me the above means 2 weeks in July & 4 weeks in August. Due to uncertainty when the WRO will be revoked, buyers would not wait it till it happens...and start booking for the whole quarter from alternative suppliers like Supermax.

In the month of June alone, Supermax shipments to U.S was matching the entire quarter of Jan - March 20.

https://importkey.com/i/supermax-healthcare-inc

Wouldnt be surprised if August becomes another killer export to U.S....

the Withhold Release Order made on WRP Asia Pacific Sdn Bhd on 30.09.2020 was only revoked on 24.03.2020?

https://www.cbp.gov/trade/programs-administration/forced-labor/withhold-release-orders-and-findings

Post removed.Why?

Conclusion
...........

World consumption of protective gloves is expected to jump more than 11 percent to 330 billion pieces this year, two-thirds of which are likely to be supplied by Malaysia, according to Malaysia's rubber glove manufacturers group.

Should Top Glove and TG Medical take prompt remedial action, it is possible that CBP might lift the WRO. This was the case with glove manufacturer WRP Asia Pacific Sdn. Bhd., upon whom a WRO was imposed last year for similar reasons, and lifted subsequent to a conforming change in its manufacturing policies. CBP will likely only be satisfied when all past recruitment fees and related costs, which hold such workers in debt bondage, are fully repaid and other preventative measures imposed

Aside from paying these debts, it is likely that CBP – as well as U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) group, which likely worked in concert with CBP on the Top Glove matter – will require further measures by Top Glove, in order to ensure that it no longer engages in forced labor practices. Top Glove will likely be required to take steps to ensure that its employment agents no longer put migrant workers into debt bondage, and that all parts of its supply chain utilize ethical recruitment practices, including zero cost recruitment policies.

Absent such longer-term remedial measures aimed at purging its supply chain of forced labor practices, Top Glove's subsidiaries will likely remain on CBP's WRO list.

CBP Issues Detention Order on Top Malaysian Medical Glove Producer Over Forced Labor Concerns

July 27, 2020

https://www.jdsupra.com/legalnews/cbp-issues-detention-order-on-top-10409/

CBP's Detention Order on medical gloves produced by Top Glove's subsidiaries has been imposed at a time when demand for these products is at its highest, with the United States still in the grip of the COVID-19 pandemic and suffering from severe shortages of PPE, including masks and hand sanitizers.

In announcing its WRO against Top Glove, CBP stated that it was aware of the current critical need for disposable rubber gloves, and would continue to allow entry of gloves produced by all other manufacturers.

It estimated that the order against Top Glove entities in Malaysia would have no significant impact on total U.S. imports of that type of glove, despite the fact that Top Glove is largest manufacturer of these gloves in the world.

.............

U.S did this with the expectation of sourcing from other suppliers

UG Healthcare - Philip Securities 28-07-2020

Never say never to blue skies

https://research.sginvestors.io/2020/07/ug-healthcare-phillip-securities-research-2020-07-28.html

https://research.sginvestors.io/2020/07/ug-healthcare-phillip-securities-research-2020-07-28.html

UG BUSINESS MODEL
.................

Large glove manufacturers such as Top Glove and Hartalega are largely OEM manufacturers. OEMs manufacture gloves for under the brand of their customers such as large medical distributors (e.g. Medline, OneMed, Marbena, Cardinal Health, Microflex, Ansell, Kimberly Clark), government agencies (Defence or Health Ministries) and non-profit organizations (e.g. WHO,United Nations).

OEMs are not keen to build their own distribution network.

Firstly, this is to avoid any conflict of interest.

Secondly, managing warehouses and logistics in the destination markets is not their core expertise especially compared to the scale of their production. Another challenge in distribution is the huge variety of products to be stocked and sold, not just a single product - gloves.

The typical logistics or sales cycle is as follows: UG manufactures the gloves from its factory and ship to its warehouses in the UK, China, Brazil and Germany. UG services many end customers that may just order several cartons every week. UG needs to have sufficient stock to meet such consistent orders for next day delivery. For effective sales, UG needs a local sales team to promote the brand, speak to customers, engage in marketing activities and provide after-sales support.

For more than a decade UG has spent building a distribution network for its own branded gloves. It started with Germany and this has now grown to major emerging countries such as Brazil, Nigeria and China (Figure 14, Figure 17). Brazil is a notable country with high barriers to entry due to the need for every glove to be barcoded.

I didnt buy UG....dont know it as much as super

Posted by zzzz52 > Jul 28, 2020 5:29 PM | Report Abuse

@probability, ya ya, both Super and UG the power of OBM.
What was your entry for UG? I got mine at 0.61.

Enjoy......

https://www.youtube.com/watch?time_continue=6&v=Qwoj3LA9pOI&feature=emb_logo

Posted by super aloha > Jul 28, 2020 5:27 PM | Report Abuse

Cheers to all superman and super girl.. Table 20 is booked since last week... Beer is free flow serving....

Who will attend the table 20 gathering?

UG Healthcare closing:

https://www.bloomberg.com/quote/UGHC:SP

UG Healthcare up 29% today - power of OBM

https://www.bloomberg.com/quote/UGHC:SP

OMG...

Posted by freetospeak > Jul 28, 2020 10:48 AM | Report Abuse

u will c the news all over the world ...lol ..if this happen

SUPERMAX 10000% INCREASE IN PROFIT FROM CORRESPONDING QTR !!!

scroll down on the below link for Dr Edwin (stockpicktou) video, and after 44 min he will talk on careplus and supermax:

https://m.facebook.com/story.php?story_fbid=771636250245829&id=2383438255226841&_rdr

scroll down on the below link for the video, ans after 44 min he will talk on careplus and supermax:

https://m.facebook.com/story.php?story_fbid=771636250245829&id=2383438255226841&_rdr

Dr Edwin from stockpick 'to' u also dare to estimate super qtr 4 conservatively 600m to 800m based on OEM price increase of average 220

- His rough estimate doesnt factor in bumper profit from associate like brazil
- Additional new lines starting end march.higher production due to max caps. he assume a max caps in jan to mar to be conservative which of course we know its not true
- OBM streamlining profit

salute to him for such daring forecast in public...lol.he must be very confident after the careplus profit announcement

they had actually planned this long back in April..

.....

Masks and gloves could be compulsory when Britain eventually gets back to work after lockdown

Government considering moves to force people to wear protective equipment at certain indoor work places as well as on public transport

17 APR 2020

https://www.birminghammail.co.uk/news/uk-news/masks-gloves-could-compulsory-britain-18104716

you just need another spike in cases in UK

ha ha..true also...

If the above rule happens, all of Supermax gloves will go to UK (Supermax Aurelia)...even then cant cope with demand already at 190USD/k gloves

MINISTERS are "looking at" whether the public should have to wear gloves to stop the spread of coronavirus, it was revealed today.

Health Minister Lord Bethell said that covering up the hands remained under consideration.

People could have to wear gloves next to stop the spread of covid
.................................................................

On the possibility of Brits having to wear gloves, Conservative Baroness McIntosh of Pickering asked in the House of Lords today: "Has the Government formed a view on the use of gloves?

"Obviously we're all following the guidance of washing our hands but surely the correct use of gloves outdoors and indoors could prevent the passing on of the virus?"

And health minister Lord Bethell, concluding a debate on coronavirus regulations, replied: "To date, gloves are not in the guidance but they remain an area that we're looking at."

ON THE OTHER HAND GLOVES could be made compulsory next for public with ministers ‘looking at’ the move

Natasha Clark
24 Jul 2020

https://www.thesun.co.uk/news/politics/12216052/public-wear-gloves-coronavirus/

thanks for the reaffirmation free...

you mean, the distributors will be forced to squeeze their margin while the OEM expands...

difficult for me to comprehend...as the demand first contact point is the distributors..and the demand pressure is transferred from distributors to OEM...


the customers are the engine....the drive....

your theory sounds like the wheel is driving the engine




Posted by hglee101 > Jul 25, 2020 2:21 PM | Report Abuse

When the demand is higher than the supply, the supplier can decide the price, furthermore, the delivery lead time is more than 12months.

you mean distributors of super sell for free (without any margin) just like topglove distributors in U.S?

kindly elaborate why is that so...

Posted by hglee101 > Jul 25, 2020 2:12 PM | Report Abuse

No different whether OBM or OEM when operation has reached 100%.

actually one simple way of comparing Super with TG is this:
...........................................................

(1) decide what OBM margin is vs OEM

i see the ratio (OBM/OEM) ranges anywhere from 5 x , to the most conservative assumption giving 2 x.
Meaning if OEM make RM 0.10 per glove OBM makes at least RM 0.20 per glove.

(2) this margin difference can be represented as equivalent gloves.

For a minimum ratio of 2, the equivalent gloves capacity of Super will be double its existing versus topglove

as such Super effective capacity is 42 billion if topglove is at 90 billion. i.e about 50% of TG


(3) mcap of super versus topglove should reflect the equivalent gloves capacity

Current market cap of TG is 70 billion versus super of 23 billion

...............

based on (2) above, shouldnt super be having at least half the mcap of topglove? instead of less than 30% currently.

Super being OBM would have higher flexibility on spot orders which was shooting to 190usd per 1000 gloves in July....

being smaller, it has higher rate of expansion in capacity (growth) lesser constrained by workers unlike topglove...

further it had established its distributors at the key affected areas like Brazil and U.S....

I am still curious why the pricing has not catch up to TG

using the above arguments, super should be priced at 26 if topglove is at 26

In a nutshell, their price should match
.................................

everyone show some respect to rr88:

https://www.youtube.com/watch?v=oCXW9IIiMoE

he was ex-commando....

so this 'biological weapon' world war just starting i guess..

you will need self protection for a long period to come

u.s can then easily send this 'biological weapon' which they have become immune to any other country....discreetly

u.s cases is almost 100k per day...and more than 5m already infected...in reality may be 10-20% of U.S citizens are already infected by now...

all it takes is another 4 months...at such exponential spread rate
(vaccine usage would be way longer 10 months
and the whole U.S is immune (of course with the expense of thousands of deaths)

may be thats what u.s is aiming for....herd immunity

with that they will be the king maker and threaten china anytime

i really do not see myself getting cured by such vaccine...

say i get vaccinated with all the side effects

by end 2021 or 2022, what happens if another new virus popped up? further its extremely likely that the current virus had mutated that even the new vaccines after so much trial phase is no longer effective for the fresh ones...

how many times should i get vaccinated then?
............................................

i see the only practical way out is herd immunity....all other good news are to console the market (Trump's priority)...

This pandemic is like a forest fire....

"it will not stop till it burns all the woods in the forest, leaving only the wet ones behind".

walao eh....need to enjoy some red wine over the weekend...



Posted by hng33 > Jul 24, 2020 8:14 PM | Report Abuse

If small glove maker, careplus with OEM can record more than 1700% profit growth in quarterly result, what will happen to supermax with much higher profit margin business model OBM + own distribution???

1000% increase profit will record RM 710m or EPS 52sen
2000% increase profit will record RM 1410m or EPS 104sen.

here for you:

https://specials-images.forbesimg.com/imageserve/1222318611/960x0.jpg?fit=scale

Posted by anticonman > Jul 24, 2020 11:16 AM | Report Abuse

M'sians and i3 members many conmen. Pls show your photo wearing glove. Upload your photo in i3 if you dare.

Post removed.Why?

lol!...entertainment is important...

Posted by zzzz52 > Jul 24, 2020 11:08 AM | Report Abuse

if there are differing points it is 100% fine. We need bad and good news. sure. it is just too much to scroll through... lol

but it is also entertainment here to many... lol

i have no issues with any naysayers......as long as they say things with sound judgement...just one long comment with substance would do...

only benefit of private group is that you can remove annoying comments which takes up the space....

as such more & more private group formation should warn people to comment responsibly....and dont waste time creating new ids

very true...face the reality...

one good example is Jaks private group...they became no longer open to criticism and differing opinion...

end up unable to see the truth

Posted by freetospeak > Jul 24, 2020 10:42 AM | Report Abuse

i am not against creating group...but if your intention is to get away then the intention is wrong.

I wonder what happens if the distributor role they had taken (as an OBM), itself fetches 30USD/1000 gloves....

5 Billion gloves sales per qtr with that margin is already enough without any OEM margin

Yes, TG guarantee up tomorrow