Superlon Holdings Bhd (+ve)

Last Friday was the first time shares in Superlon Holdings Bhd (fundamental: 3/3, valuation: 2/3) triggered our momentum algorithm this year, after a sudden surge in demand pushed up the share price of the nitrile butadiene rubber foam manufacturer by 14.21% since end-May to a fresh high of RM2.25 last Thursday.

Superlon has been generating daily trading volumes upwards of 1.5 million shares since early this month, compared with its 200-day average of 258,831. Its shares closed unchanged last Friday after 1.54 million were exchanged.

On the same day, the company announced its fourth quarter ended April 30, 2016 (4QFY16),  net profit of RM3.7 million, 14.25% higher than RM3.24 million in 4QFY15, as revenue rose 13.1% to RM23.61 million, from RM20.87 million, on higher demand for thermal insulation products for export and in the local market.

Its top-line growth was underpinned by higher volumes and favourable exchange rates.

Export sales surged 30%, while local sales climbed 13%, it said in a statement.

For the full year (FY16), it achieved a 77.59% rise in net profit to RM16.66 million — its best year ever — from FY15’s RM9.38 million.