Technical tracker - HLIB Retail Research – 4 Jan 2021*
*TEKSENG (RM0.66 – Not-rated) - A new lease of life*
*2020 would be a transformational year for TEKSENG after incurring steep losses in FY18-19 (driven by the impairment loss recognised at its solar division), premised on rising demand for PVC products on surging usage for household products, office and home furniture during Covid-19 WFH practice, timely capacity expansion (+150% to 820MT pa) to meet growing demand for PP non-woven products and diversification into PPE and medical industry*
*The stock is trading at 7.4x FY21 P/E (59% below its peers and 52% lower than its 5-year average), supported by a strong FY20-22 earnings CAGR of 18%, attractive FY21-22 DY of 4.5% and solid NCPS of RM10.5sen*
Last year whole year order has been fully book. This time probably same as well looking at they purchased that property. Many cases still spiking around the world not just in Malaysia. The demand might be around for few more years to come.
TEKSENG is engaged in the manufacturing and trading of: (i) Polyvinyl Chloride (PVC) related and non-woven related products, and (ii) solar cells, solar panels, solar modules and solar-related products.
After posting losses in the preceding two years, the Group is on track to return to the black this year with net profit coming in at RM8.1m in 3QFY20 (compared with 3QFY19’s RM0.2m). This took YTD earnings to RM19.2m (versus a net loss of RM3.3m previously) for the nine-month period ended September 2020 mainly thanks to stronger contributions from the PVC segment (which saw higher selling prices and increased demand for non-woven products such as face masks and gowns as well as from the furniture industry).
In addition, its balance sheet is backed by net cash holdings of RM37.8m (or 10.5 sen per share) as of end-September last year.
Technically speaking, after moving broadly sideways for the past five months following its correction from a high of RM1.44 in early August, the stock is poised to break out from the existing consolidation phase.
Driven by the bullish signals arising from the crossover of the DMI+ above the DMI- and the momentum indicator climbing above the zero line, a probable lift could propel the stock towards our resistance thresholds of RM0.85 (R1; 16% upside potential) and RM1.00 (R2; 36% upside potential).
We have set our stop loss price at RM0.63 (or 14% downside risk from yesterday’s close of RM0.735).
New IPO: The onshore and offshore support services provider for the O&G industry, Steel Hawk Bhd aims to list on the Ace Market!
MQ Trader 2938 views | 2 d ago
0:17
New IPO: The largest mini-market player and a leading groceries retailer in Malaysia, 99 Speed Mart Retail Holdings Bhd aims to list on the Main Market!
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....
Newbie318
331 posts
Posted by Newbie318 > 2021-01-07 17:46 | Report Abuse
Bravo!!! Tekseng,
Very undervalue counter.