“Vaccine” term is just a joke as I have always been using the term “Tri-Vaccine” as my maximum investment/exposure in SuperMax , TopGlove & BAT at the onset of Covid-19. Luxchem as an additional hedge due to the evolving Covid-19 and a Cash rich penny stock @ 0.515 . Also, mainly due to glove sector related as big suppliers to TopGlove & Kossan.
For LuxChem, no worries. Stay invested. This QR to be announced this month is a non event as it is prior to the impact from Covid-19. QRs to be announced in May, August & November are the ones worth watching that will propel it to greater heights :-)
Luxchem Corp is expected to issue its FY19 results by the end of this month.
The company has been experiencing higher demand recently from the glove manufacturing sector due to the coronavirus outbreak.
RHB Research forecasts Luxchem to register an FY19 profit after tax and minority interest (Patami) of RM38.9mil, a slight improvement from the RM38mil recorded in the previous year.
This figure in the first nine months of 2019 stood at RM28.1mil.
The coronavirus outbreak has seen the company receiving higher purchase orders from its glove-making clients.
However, as the situation is still evolving – particularly in terms of the possible duration of the outbreak, which varies amongst the experts – RHB Research is keeping its FY20 forecasts, pending a post results meeting with management.
“We understand that Luxchem’s manufacturing arm, Transform Master, completed its plant expansion at the end of 2019 – this was according to schedule.
“The expanded facility can now handle 18,000 tonnes per annum (tpa) from 13,800 tpa previously, ” the research house said.
Recall that Transform Master was acquired in 2016.
At the time of acquisition, it had a manufacturing capacity of 9,600 tpa.
RHB Research maintains its buy call target price for Luxchem, which is based on an unchanged 13 times FY20 price-earnings ratio (PE) on an earnings per share (EPS) of 4.5 sen
Luxchem’s stock has experienced increased market followings in the past three weeks as a thematic play.
This is arising from the coronavirus outbreak, given its exposure to the gloves sector.
Interest may sustain should the outbreak’s peak be delayed.
I know. Background Corporate Video for newbies. My position already maximum for exposure to a single counter @ 0.515 :-) What RM2 ? I am more than happy with 0.80-1 !
https://www.klsescreener.com/v2/announcements/view/3109044 Good QR & Dividend for period prior to Covid-19. Looking forward to even better QR for FY2020. Watch the QR1 FY2020 to be announced in May 2020 with the positive impact from Covid-19 :-)
Good result within expectation and 1.25 sen dividend declared. I like the free cash flow is strong. As capex requirement is low, may expect more generous dividend in the next 1-2 years.
Strong Balance Sheet. Cash position has increased further from RM107m to RM126m in this challenging and turbulent economic period of 2020. In addition, LuxChem in a glove related sector that is positive due to the evolving Covid-19. I am glad I have the first mover advantage by panic buying and maximizing my investment @ 0.515 on 5/2. QR 2019 lower trading sales was mainly due to the protracted US-China trade war that impacted most Companies.
Annual Dividend yield nearing 5% based on ~ 0.50 entry price. Profitability & dividend rate (Special Dividend ?) expected to be even higher in 2020 arising from the positive impact of Covid-19 in this environment of low FD interest rate.
Luxchem has ample cash to pay dividend since RM132m in Cash/Bank as at 31/12/2019 based on the latest QR. Their borrowings (positive gearing) of RM60m plus solely as natural hedging in Rupiah and excellent Treasury Management. Hopefully, with a projected good QR1 2020, we look forward to an increased in annual dividend plus Special Dividend in FY 2020 :-)
The emerging trend in the industry is favourable to Luxchem Corp Bhd, which supplies nitrile (synthetic latex) to glove producers, such as Hartalega Holdings Bhd, Top Glove, Supermax, and Kossan Rubber Industries Bhd.
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
DickyMe2
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Posted by DickyMe2 > 2020-02-13 09:37 | Report Abuse
yah gah?