Although the latest quarter result below expectation, but based on market cap of RM146mil, NAT of RM2.10, the current share price RM1.18 is still considered cheap.
From eps -5.75sen in 1q20 to +5.5sen in 1q21 is damn good the results. Even coming down from 7.92sen in 4q20 was also very good.Don’t forget we are currently still in covid pandemic and under Mco!In fact any company who can register positive results is already commendable!We need to look medium to look term.Conclusion is buy during price weakness! Just my personal opinion
I think the company accountant could be using other method to calculate the depreciation ie sum of years’ digits or 150% declining balance method,not the usual straight line method!
Today comment on TEXCHEM from 1.33 down to 1.18 is : Panic Sell ! If 1.08 is Best Buy! If 0.99 is SUPER MEGA ATAOMIC NUCLEAR BOMB SALES ... hoot kao kao eeeeee......
Texchem normally not given dividend, because its debt level is high. So it need cash to pare down its debt.
We buy Texchem for few reason :-
1) Share price is 50% of its NTA 2) Market cap now is RM118mil, PAT is around RM30-40mil. 3) Market cap is RM118mil, quarter revenue is RM260mil, annual revenue is RM1bil. For a company that doing RM1bil business, the market capital only RM118mil, it is very very undervalue. 4) Chemical business - we foresee chemical industry will be doing very well this two year (i.e. PCHEM, LCTITAN, HEXTAR, LUXCHEM, NYLEX, ANCOM...etc), all Chemical business are doing very well, including Texchem. And Texchem is the cheapest among them. 5) Bonus issue, based on current reserve, the company can anytime announce 1:2 bonus issue. if company continue to earn more profit for the next 3-4 quarter, then it can announced 1:1 bonus issue.
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Albukhary
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Posted by Albukhary > 2021-05-03 19:57 | Report Abuse
Although the latest quarter result below expectation, but based on market cap of RM146mil, NAT of RM2.10, the current share price RM1.18 is still considered cheap.