Kukumanis u seem to be talking to urself!!!!

FIRST i ask it,,since nobody answer it,,i search it and found it.. do you understand

http://www.thesundaily.my/news/1147602

this what happens 'when we are not desperate for jobs',, order book depleting badly,, always sending lies information to retail investors,, so who suffers now,,it is the retail investors like you and me...now they are saying recovery will take place in 2015,,after chewing the betel nuts..lies lies lies delays delays n delays

Post removed.Why?

MANAGEMENT OF MUDAJAYA,,,GREAT LIERS

Post removed.Why?

what is the market capitalisation of PMBTECH ???????????

Post removed.Why?

Post removed.Why?

dear TCB, Matrixcool and profitman
what are your STRONG BUYS, during market consolidation????? i mean STRONG BUY

Posted by miapancho > Aug 15, 2014 07:52 AM | Report Abuse

THOSE WHO WANT TO KNOW MORE INFORMATION ON MUDAJAYA, PLEASE CONTACT IR OF MUDAJAYA, MR BENJAMIN AT,, 0378067825 OR 0378067826.... PLEASE SHARE YOUR INFO, THAT YOU GOT FROM HIM, HERE ON THIS SITE FORUM....PREFER MANY PEOPLE FROM THIS SITE SHOULD CONTACT HIM,, SO MORE ACCURATE INFO WILL BE POSTED ON THIS SITE


mia pancho had put this many times, i think this is a good idea to always keep communication with the IR of mudajaya..this is a very conservative company,, always trying it s best not to communicate with investors.. so it s our duty to always disturb them.. i had already communicated with him, the firing is at the end of 3rd quarter,,september... mind you this time firing is not enough,,because firing news will only push the share from 2.40 s level to 3 only...it won t go further then 3... inorder to go beyond 3,, then must wait for few quarters more,,when solid profit started showing up..


IT S ALREADY TIME TO DISTURB THE IR OF MUDAJAYA,,,MR BENJAMIN

Century Bond (CBD MK)
Technical BUY with +15.0% potential return
Last price : RM1.52
Target Price : RM1.64, RM1.76
Support : RM1.38
Stop-loss: RM1.37
BUY with a target price of RM1.76 with stoploss
below RM1.37. Since earlier this year,
CBD’s share price has been declining steadily
from the high of RM1.76 as the share price
treads inside a downward price channel.
However, yesterday’s breakout above the
channel and the “cloud” implies the end of the
long-term downtrend and the start of a new upleg.
A higher trading volume of 0.63m shares
(vs 20-day average of 0.09m) was recorded
upon yesterday’s breakout, signalling strong
interest in CBD. A bullish crossover in both
MACD and Stochastic indicates a growing
momentum which in our view is likely to lift the
share price higher in the near term. A hidden
“bullish divergence” was detected which is in
line with our reversal expectation as we peg
our upside target to the previous high of
RM1.76 over the medium term.
Expected Timeframe: 2 weeks to 2 months

Sealink International-----------yesterday report
(SELI MK)
Technical BUY with +23.0% potential return
Last price : RM0.605
Target Price : RM0.650, RM0.745
Support : RM0.565
Stop-loss: RM0.560
BUY with a target price of RM0.745 with stoploss
below RM0.560. Following a steep
correction from the high of RM0.745, SELI’s
share price has met support at RM0.565
(previous high) as the share price rebounded
from the 50.0% Fibonacci retracement level.
We opine that the selling pressure has been
fully absorbed amid the presence of a “bullish
divergence” between the share price and
Stochastic. SELI also rebounded off the rising
trendline and managed to close above the BBI
line for the first time since 22 Jul 14, signalling
a significant change in the short-term outlook
to bullish. The emerging interest as shown by
the higher trading volume as SELI formed a
bullish cross engulfing should translate into a
reversal from the recent correction to the new
up-leg. We set the previous peak of RM0.745
as our medium-term target.
Expected Timeframe: 3 weeks to 3 months

CCK Consolidated Holdings-------yesterday uob kay hian report
(CCK MK)
Technical BUY with +16.0% potential return
Last price : RM0.970
Target Price : RM1.01, RM1.13
Support : RM0.900
Stop-loss: RM0.895
BUY with a target price of RM1.13 with stoploss
below RM0.895. CCK’s share price has
retraced from the recent high of RM1.01 before
rebounding off the immediate support of
RM0.900. As the share price continues to
surge higher, it closed above the bullish
crossover of 7-day and 21-day EMA lines
yesterday on the back of a much higher trading
volume of 0.6m shares (vs 20-day average of
0.08m) which suggests renewed interest may
spur an upward movement from here onwards.
This is consistent with rising momentum while
an uptick in +DI indicates a stronger uptrend
ahead. As such, we expect CCK to resume its
long-term uptrend as we peg our upside target
at the 1.61x Fibonacci extension level of
RM1.13 over the medium term.
Expected Timeframe: 2 weeks to 3 months

Mulpha International
(MIT MK)
Technical BUY with +14.6% potential return
Last price : RM0.515
Target Price : RM0.550, RM0.590
Support : RM0.485
Stop-loss: RM0.480
BUY with a target price of RM0.590 with stoploss
below RM0.480. MIT’s share price has
made a breakout above the “rounding bottom”
pattern on 23 Jul 14 before peaking at the high
of RM0.550. Following a “return move” from
the recent high, MIT met the support at the
previous resistance of RM0.485 before
maintaining consolidation in the past 7 days.
However, yesterday’s strong gain on the back
of a higher trading volume has established a
new up-leg as the share price is set to resume
its previous uptrend. The uptick in RSI signals
a growing momentum and is thus likely to lift
the share price higher in the near term. We
expect the uptrend to restart as MIT is likely to
retest the previous high of RM0.550, which if
breached, could catapult the share price
higher.
Expected Timeframe: 2 weeks to 2 months

PMB Technology
(PMBT MK)
Take Profit. Technical SELL with +16.0%
potential downside
Last price : RM1.74
Target Price : RM1.60, RM1.50
Resistance: RM1.94
Stop-loss: RM1.95
SELL with a target price of RM1.50 with stoploss
above RM1.95. Following our earlier BUY
call on 14 Aug 14 at the price of RM1.20,
PMBT’s share price has hit our initial target of
RM1.43 before surging higher to peak at
RM1.94. However, given yesterday’s negative
closing on the back of a bearish candlestick
pattern of “engulfing”, we expect the share
price to fall lower and thus recommend
investors to lock in the recent gain of 45%. Our
view reflects an easing buying momentum as
Stochastic has shown a bearish crossover
while the downtick in +DI signals a weaker
share price movement ahead. Potential
support can be seen at both the Fibonacci
retracement levels of 38.2% and 50.0% of
RM1.60 and RM1.50 respectively.
Expected Timeframe: 1 week to 1 month

Post removed.Why?

patience slow n steady

welcome guys

Posted by miapancho > Aug 15, 2014 07:52 AM | Report Abuse

THOSE WHO WANT TO KNOW MORE INFORMATION ON MUDAJAYA, PLEASE CONTACT IR OF MUDAJAYA, MR BENJAMIN AT,, 0378067825 OR 0378067826.... PLEASE SHARE YOUR INFO, THAT YOU GOT FROM HIM, HERE ON THIS SITE FORUM....PREFER MANY PEOPLE FROM THIS SITE SHOULD CONTACT HIM,, SO MORE ACCURATE INFO WILL BE POSTED ON THIS SITE


mia pancho had put this many times, i think this is a good idea to always keep communication with the IR of mudajaya..this is a very conservative company,, always trying it s best not to communicate with investors.. so it s our duty to always disturb them.. i had already communicated with him, the firing is at the end of 3rd quarter,,september... mind you this time firing is not enough,,because firing news will only push the share from 2.40 s level to 3 only...it won t go further then 3... inorder to go beyond 3,, then must wait for few quarters more,,when solid profit started showing up..

lawrencelim ---thank you very much

greddym3 september is possible.they just received green light to mine their own coal.
18/08/2014 19:36


you have any link ??

Posted by stay_foolish > Aug 19, 2014 01:42 AM | Report Abuse

Dunknow

pmbtech

Sorry for the late reply.

PMBTECH

Stage 2 of Market Cycle- Very Bullish. On 14/8,it break above $1.20 and entered into Uncharted Territory. Formed Spinning Top on 18/08 which may indicate further consolidate between $1.64 and $1.94. Any weakness due to overbought or profit taking may find $1.64 as immediate support and $1.57 is stronger support. If break above $1.94 may test TP 1 at $2/ $2.10. Congrats if you are one of the winner of it. Do remember to set Trailing Stop Loss to prevent it turns against you.

FYI, UMA does not affect much on the share price.

Happy Trading


HERE I FOUND SOMETHING ON PMBTECH,,COMMENT FROM STAY_FOOLISH...POSTED TODAY AT 1.42 PM

My Dearest TCB
from the way PMBTECH moved today, do you think it is temporary on consolidation or breather?? if yes then what are it support and resistance levels?? what are the good entry levels? thanks TCB

CIMB TARGET PRICE 1.23,,,,SLOW N STEADY MA

Post removed.Why?

With the upgraded yard, THHE can, starting from 1Q15, take on a fabrication
order book of up to RM1.2bn p.a. compared with RM400m p.a. currently.
There is upside to the fabrication order book if the company acquires or leases
neighbouring yard space, taking its yard capacity to around 80,000 tonnes p.a.
and subsequently closing the capacity gap between THHE and the bigger yard
operators, namely SapuraKencana (SAKP MK, Add) and MMHE (MMHE MK,
Reduce).
THHE is currently bidding for three Petronas central processing platform (CPP)
projects worth around US$1bn each, with awards expected to be made between

More from THHE's inaugural roadshow
The roadshow was CEO Nor Badli Alias's first investor event with a broker since
he joined THHE in FY10. He was accompanied by Alex Chow, GM of corporate
services. Over two days, we sat down with 48 fund managers from 25 fund
management companies. Most of the fund managers met with management for
the first time during the roadshow.
Overall, we view THHE's investment proposition as well-received. It offers a
high-growth story and sufficient liquidity that come with undemanding
valuations relative to the sector average. There were concerns among the fund
managers about the fabrication contracts, which tend to be lumpy with short
durations of 1-2 years, but we note that the company's inroads into FPSO and
T&I give it a solid earnings outlook as the income prospects from these two
businesses are longer term in nature.
The following are main takeaways from the roadshow:
Yard expansion is ongoing
Spanning 57 acres, THHE's sea-fronting yard is located at Pulau Indah
Industrial Park, Selangor. The yard is currently 25% utilised, but in
anticipation of future projects, THHE is modernising and doubling its yard
capacity from 10,000 tonnes p.a. to 20,000 tonnes p.a. The upgrade works are
slated for completion by year-end, later than the original target of end-3Q14.
Nonetheless, the company completed Murphy's RM196m Permas topside
project earlier this month as scheduled. The structures are set to be loaded out
in Oct 2014.
The completion of the Permas project reduces THHE's order book from a
record RM1.6bn to RM1.5bn currently (Figure 1). An estimated 11% of the
outstanding order book will be recognised this year. The company is on track to
finish Lundin's RM120m Bertam wellhead platform project in Nov 2014 and its
largest fabrication project to date, Petronas Carigali's RM250m Kinabalu
topside project, in Aug 2015.

Hot and heavy roadshow



Fabrication order book replenishment and the new FPSO venture were the
main talking points at our recent roadshow with management of THHE. The
positive surprise from the roadshow was that the company may add a second
FPSO vessel in as early as 1H15. Our target price rises as we raise our FY15-16
EPS to impute contribution from the fabrication of FPSO modules, which more
than offsets the dilutive impact from the warrants. We continue to value the
stock at a CY15 P/E of 16.4x, a 30% discount to the average P/E of the oil &
gas big caps. A growing order book and successful FPSO and T&I ventures are
the potential re-rating catalysts. THHE remains an Add and our top pick
among the oil & gas small caps.
What Happened
On 11-12 Aug 2014, we took THHE's management on a roadshow in Kuala
Lumpur. Management met with 48 fund managers from 25 fund management
companies. It was the first roadshow ever for management, which took the
opportunity to introduce the company and shed light on its operations and
growth plans, including its recent venture into the floating, production, storage
and offloading (FPSO) business. With the first FPSO contract under its belt, the
company targets to scoop up its second FPSO contract in as early as 1H15.
Furthermore, we learned today that 30%-owned Berlian McDermott is bidding
for a sizeable transport and installation (T&I) contract in Brunei, with the
outcome expected by year-end. See overleaf for more roadshow highlights.
What We Think
We sense that the fund managers were cautious about THHE's fabrication
business, where projects tend to be lumpy. Therefore, the FPSO angle was
viewed more favourably as there are longer-term income prospects. THHE's
contract for its first FPSO vessel, Deep Producer 1 (DP1), is for eight years, with
extension options of up to ten years. Assuming the same terms as for DP1, the
second FPSO vessel could add another RM48m to THHE's FY17 net profit.
What You Should Do
Accumulate the stock. Our forecasts of record profits in FY12-14 support our
sector-beating 3-year EPS CAGR of more than 100%, significantly above the
sector average of 31%. Yet, its valuations are undemanding at 11-14x FY15-16
earnings. Earnings visibility is solid given the current FPSO contract, with the
added attraction of the potential second FPSO contract.

6. TECHNICAL ANALYSIS
6.1 At new all-time high
TGI’s monthly chart shows the stock has surpassed the RM2.55 2005 high and
the stock is now at a new all-time high. Monthly MACD is still positive but RSI
looks a bit overbought at 80. Weekly chart shows the stock in an uptrend
channel with next resistance at the RM3.05 levels.

5.3 Using SOP to value the stock
We are using sum-of-parts (SOP) to value the stock. This is to reflect the high
value of its cash and net current assets. The current net cash and net current
assets are worth RM1.74 per TGI share, which is around 67% of its current
share price. In our SOP, we are valuing its current operations at 13x FY15 P/E,
in line with the packaging sector’s FY15 P/E target.
5.4 Initiate with an Add
We are initiating coverage on TGI with an Add rating, with implied target price
at RM3.95 (RM3.00 ex-ICULS and warrants share price, based on 30%
discount to its fully-diluted RM4.28 SOP/share). The large SOP discount is to
reflect its small market capitalisation and tight stock liquidity. At implied
RM3.95 target price, valuation is only at 10.5x 2015 P/E (basic-EPS).
5.5 Ex-ICULS and warrants
TGI’s proposed ICULS and free warrants issue should be completed sometime
in the next 1-2 months. Ex-date is likely in end-Sep. Assuming full conversion
of the ICULS and warrants, issued share base rises from 105.2m to 184.1m
shares, a 75% increase. Our adjusted ex-ICULS price for TGI is at RM2.09 but
after adjusting for the free warrants (valued at RM0.71 based on the Black
Scholes option pricing model), the ex-all price is lower at RM1.98. The ICULS
should raise RM52.6m with another RM39.5m assuming the warrants after
fully converted.

5. VALUATION AND RECOMMENDATION



5.1 Stock is under-researched
TGI is currently not under the radar of most institutional investors, which is
not surprising as there is no research house with active coverage of the stock.
We believe over time, there should be more interest in this stock as both
institutional and retail investors understand the company’s growth potential.
5.2 Stronger earnings ahead
We forecast a 3-year net profit CAGR of 16% for TGI, driven by earnings growth
from its stretch film, PVC food wrap and garbage bag divisions. Our earnings
forecasts are conservative. In addition, we have not reflected any potential
earnings from any M&As. With its strong net cash balance sheet, the company
has indicated that they are looking for potential M&As that have synergies with
its operations. For example, in 2010, the company acquired TGSH Plastic
Industries for RM8m and in a short period of time, management turned around
this loss making company and operational cash flow is positive.

4.4 Pays out 25-30% of its earnings
The company does not have a dividend policy but in the past few years, its net
dividend payout ratio has been between 25% and 30%. We have assumed a 30%
net dividend payout ratio for the company over the next three years

4.3 Strong balance sheet
As at end-Mar, the company is in a net cash position of RM38.1m or RM0.36
net cash per share. Assuming the RM52.6m ICULS issue is completed in Sep,
TGI’s net cash position is expected to rise to around RM90.7m or RM0.86 net
cash per share (existing issued share base), RM0.57 net cash per share if we
assume full ICULS conversion (157.8m issued share base). If we assume full
conversion of its proposed warrants, TGI’s net cash rises to RM130.2m or
RM0.71 net cash per share (184.1m issued share base assume full ICULS and
warrants conversion).

4.2 Higher profit margin in the near future
As the company moves up the value chain, we expect group EBITDA and pretax
profit margin to improve over the next few years. We estimate TGI’s 3-year net
profit CAGR at around 16%, supported stronger topline growth. Our earnings
forecasts are conservative. It could be higher as we have not taken into account
any potential profit from any M&As.

3.4 Risk of substitute products
TGI’s plastic film and products could face challenges from other substitute
products in the future. However, due to the flexibility and competitive cost of
using plastic, we believe there are currently no major product threats for the
company’s stretch film or garbage bags.
3.5 Competition
The stretch film industry is competitive, with competition coming from Asia,
Middle East and Europe. TGI’s management is looking to move up the value
chain to differentiate itself in the market. The company will start operations of
its first nano-layer stretch film line by the end of this year.
4. FINANCIALS
4.1 Signs of earnings growth since 2013
After flat earnings in 2011-12, TGIB’s earnings growth started to accelerate
from 2013 onwards. This was mainly due to profit margin expansion as
management focused on producing high value-added products, which offer
higher profit margin. The profit margin decline in 4Q13 was mainly due to forex
volatility.

For example, in 4Q13, the company’s pretax profit margin was only 2.5%
compared to 7% in 3Q13. We believe this was mainly due to the depreciation of
the Japanese yen against the US$ in 4Q13. At end 3Q13, US-yen was 96.9
compared to 105.2 in end-4Q13. The yen depreciated 8.5% against the US$
during the quarter.
3.3 Rising electricity and labour costs
Both electricity and labour cost is around 3% of TGI’s production cost (Figure
20). The company might have to partially absorb any rise in its electricity and
labour costs and this could put some pressure on profit margins.

3. RISKS
3.1 Sharp rise in raw material prices
At any point in time, the company has more than RM100m worth of inventory,
enough to sustain operations for 1-2 months. 80% of its production cost is from
raw materials and the selling price for its stretch films is usually based on a
“cost plus” basis. What would be negative in the short term for the company is a
sharp rise in raw material prices in a short period, whereby the company would
have to absorb some of the raw material price increase. If raw material prices
fall rapidly (for example when crude oil price collapsed in 2H08), TGI might
have to make provisions for inventory value depreciation.
3.2 Currency volatility
75% of TGI’s revenues are derived from exports, with Japan being its largest
export market. Sharp volatility in the forex market could have a negative impact
on short-term profit margins.

With the right formulation, nano-layer stretch films have better film properties,
stronger puncture force movement and higher load retaining force. As such,
these nano-layer films are thinner, lighter and stronger stretch films and offer
higher profit margins. If all goes well, TGI could be adding more nano-layer
stretch film lines over the next few years.
2.5 Expanding its PVC food wrap capacity
The company is also looking at increasing production capacity for its PVC food
wrap division. The current production of 500 tonnes monthly should double
next year due to the strong demand from both Asean and Asia markets. In the
next few years, TGI should become the largest PVC food wrap producer in
Asean. Profit margin from this division is much higher than its stretch film
business. TGI is expected to aggressively grow this division over the next few
years.
2.6 Strong demand for its garbage bags
Under Japan’s generalised system of preferences (GPS) scheme, it reduced
tariffs for designated imported products from developing countries (like China)
in an effort to help increase export income and promote economic development.
However, we understand that Japan’s 3.5% GSP for China’s garbage bags was
lifted two years back and as such, Japan is currently looking to import garbage
bags from other countries.
To take advantage of strong demand from Japan, we believe TGI is looking to
expand production capacity for its garbage bags at its Sungai Petani plant while
maintaining production at its China operations. Management is looking to
expand production capacity for this product in 2015.
2.7 M&A?
Management is also looking at M&As to grow its business. With a strong net
cash balance sheet from funds raised from the ICULS and internal funds, the
company is on the lookout for businesses in the region that offer synergies and
growth. We have not reflected potential earnings from any M&A activities.
2.8 SWOT analysis
Our SWOT analysis shows that the company is moving up the value chain by
focus on producing higher value-added products. This is needed if the company
wants to differentiate itself from its competitors. Capex is not a concern as its
balance sheet is strong. With a larger production base, this should generate
greater economies of scale for the company. PVC food wrap,
industrial/commercial films and thin and nano-layer stretch film divisions
should drive strong earnings growth for TGI over the next few years.

Post removed.Why?

2.2 The global stretch film industry
The global stretch film has been growing 6-7% annually since the 2008 global
financial crisis, with capacity growth coming mainly from Asia and the Middle
East. In 2014, global stretch film demand is estimated at around 3.7m tonnes
(2.8m tonnes in 2009) with Europe being the largest stretch film market.

2. OUTLOOK
2.1 Major expansion plans over the next few years
TGI is looking at undertaking a major capacity expansion exercise over the next
few years for its various businesses in the company, costing as much as
RM100m. We estimate the group annual production capacity to rise to around
170,000 tonnes (from 120,000 tonnes in 2013) in 3-4 years, with capacity
growth to come mainly from thin stretch films, garbage bags,
industrial/commercial bags and PVC food wrap lines.

1.11 Other products
TGI also produces its own calcium carbonate (CC) and white masterbatches.
Masterbatch is a solid or liquid additive for plastic used for colouring plastics
and produced by the compounding process. This division makes RM10m-15m
revenue annually and RM1m-1.5m in pretax profit. The company is planning to
produce higher-value added compounds with its recent new investment in this
division.
TGI recycles its in-house waste internally and the main recycling divisions at its
Gurun plant. The compounding and recycling division have allowed the Group
to be competitive against any low cost producers as the
compounds/masterbatches and recycled resins can be blended back into
producing plastic films. TGI also trades in related products such as plastic and
paper raw materials mainly to support its sub-contractors and customers.
1.12 Recent developments
In Feb-2014, the company proposed a RM52.6m ICULS issue on a 1:2 basis, 1
ICULS for every two shares. In addition, shareholders will get free warrants on
a 1:2 basis for the ICULS, one free warrant for every two ICULS subscribed. The
ICULS conversion ratio is 1 ICULS-to-1 share, only from the third year onwards
while the warrants can be converted to underlying shares anytime once listed at
an exercise price of RM1.50/share. TGI expects to complete the ICULS and
warrants issue next month. The ex-date for the ICULS and warrant subscription
is likely to be in end-Sep.

Post removed.Why?

Post removed.Why?

1.7 Garbage bags… money to make from rubbish
This product is the second largest contributor for the company. The annual
production capacity is 40,000 tonnes and the company has been exporting to
Japan (its largest export market) since the 1980s. Its first export market was to
the tough Japanese market. According to statistics from Japan, TGI is the
largest exporter of garbage bags to this country, commanding 1o-15% market
share. Today, TGI also exports to the Asia Pacific and Europe markets.
The main raw material for garbage bags is high density polyethylene (HDPE).
TGI’s garbage bags can be eco-friendly with 100% bio-degradable bags. We
estimate average pretax profit margin for garbage bags at around 5-6%, slightly
higher than stretch films. HDPE and LLDPE prices track each other quite
closely.

Post removed.Why?

1.4 Produces wide range of plastic products
TGI produces a wide range of plastic film and bags (for both domestic and
exports markets) such as:
i) stretch films
ii) garbage bags
iii) PVC cling food wrap
iv) industrial/commercial bags and films
v) calcium carbonate/white masterbatches and other plastic compounds
Total group production capacity is around 130,000 tonnes annually and on
average, the plants are operating above 80% capacity. The main products
manufactured by the company are stretch films and garbage bags for the export
markets (mainly to Asia Pacific). The company also has its own F&B division,
which is involved in the manufacturing and trading of beverages and consumer
products under its “888” and other brands.

1.3 The Ang family is the largest shareholder
The Ang family are the largest shareholders in TGI, holding both direct and
indirect 45.5% equity stake in the company. The Group is led by its Group
Managing Director (since the 1970s), Dato’ Ang Poon Chuan. The current
issued share capital for the company is 105.2m shares.

Post removed.Why?

Stretching forward------TODAY CIMB REPORT TARGET-----3.95,,WOW SO HIGH HA

Thong Guan Industries is one of the country’s two largest film and bag
producers, mainly for export to the Asia Pacific markets. The company
is embarking on a major capex over the next few years and we forecast
at least 16% 3- years CAGR net profit growth.
We are initiating coverage with an
Add recommendation, with implied
target price at RM3.95 (30% discount
to its ex-ICULS and warrants
fully-diluted SOP/share). The large
SOP discount is to reflect its small
market capitalisation and tight stock
liquidity. Potential catalysts for the
stock include higher group EBITDA
margins and M&A developments.
Major plastic film and bag
producer
Thong Guan Industries (TGI) is one of
the country’s two largest plastic film
and bag producers, mainly for export
to the Asia Pacific markets. Core
products include stretch films,
garbage bags, industrial/commercial
bags & films, plastic masterbatches
compounding and PVC cling film for
food. The main revenue contributor is
the stretch film division. By year-end,
TGI will be adding another thin
stretch film line and its first
nano-layer stretch film line.
Moving up the value chain
Management is focusing on moving
up the value chain. The company
has set up a US$2m research &
development (R&D) centre at its
Sungai Petani plant mainly for its
stretch film and stretch hood,
particularly for the thin and
nano-layers stretch films. The PVC
food wrap division will also be
another major earnings contributor
for the company as management is
doubling its existing monthly 500
tonnes capacity in 3Q14 and 2015.
Major expansion in the
pipeline
The company is embarking on a major
expansion plan over the next few
years with capex as much as RM100m.
We estimate group annual production
capacity to rise to around 170,000
tonnes (from 120,000 tonnes in 2013)
in 3-4 years. Funding this capex is not
an issue, with funds to be raised from
the proposed ICULS issue. In addition,
the company generates at least
RM40m operational cashflow
annually.
Subscribe for ICULS issue
Investors should subscribe for TGI’s
proposed RM52.6m ICULS (based on
a 1:2 basis), which comes with free
warrants (1 warrant for ever two
ICULS subscribed). The ex-date is
likely to be in late-Sep.