Make Gloves Great Again: Look Forward
Many are asking - why glove stocks are running after reporting huge losses. Simple, because stock market looks forward, not backwards, not even at the present. Usually, most take a 12-month view. Remember Mar-Apr 2020? Many stocks tumbled 50-70% as funds panicked and rushed to sell out holdings, especially tech stocks. On the other hand, retailers believed that although earnings outlook for stocks might be very bad for the next few quarters, but share price has fallen too much. They believed if they invest and hold their nose for 12 months, the outlook will eventually improve, and they could potentially make more than 100%. So they took the bold decision to start buying the stocks way before the stocks turn profitable. Sounds familiar? Let's examine if this is a déjà vu for gloves below:

ASP finally started rising - the one signal the whole market had been waiting for a long time, and now it's here. Harta raised ASP this Feb. Topg has followed suit, and will be raising again in April. Even Chinese players like Intco also said they will start raising in 2Q-3Q this year.

Customers' destocking will end in a few months' time (according to glovemakers), and inventory will go back to normalised level - so no more excess inventory. Once that happens, customers will have to start restocking again. One of the signs was, glove tenders from government and NGOs have stopped for 1.5 years, and recently, Topg saw the tenders coming back from UK, and rising enquiries from other countries. So, if we look forward, glovemakers' utilisation rate/volume could improve.

No more oversupply. All small glovemakers like Mah Sing, Salcon and many Chinese players have exited the market. Semperit also sold its glove business. Not to mention major players like Topg, Intco and Harta have all aborted expansion plans, and in fact, halted a big chunk of their existing capacities.

Costs will likely peak in 1H 2023, and could improve in 2H 2023, because natural gas prices (needed for production) will likely fall in coming months as oil prices have fallen almost 50% from last year's peak. Besides, the worst impact from electricity tariff hike will be effected in 1H 2023. Anwar said "we will only increase tariff for big companies that earn billions of profits". Are glovemakers making billions of profits now? Obviously not. So I believe electricity rates will not rise further for glovemakers in 2H 2023. So, if we look forward, costs could improve.

So how now brown cow? Yes, admittedly things are still not rosy yet right now, but if ASP climbs, volume picks up and cost improves later, doesn't that indicate the worst losses could be over by Mar or Jun 2023 quarter, and things could improve thereafter? So if we look forward and take a 12-month view, can we make more than 100% from gloves this time? I'm not sure, but pre-pandemic, Harta for instance was trading at RM5-7, now it's below RM2. Btw, TOPG, the leader of glove, has just seen MA200 breakout the first time after 2 years.

F China supply. Some may argue, China may spoil market, like steel last time. Consider this difference: more than 50% of steel supply comes from China, whereas only around 20% of glove supply comes from China while Malaysia has 60% market share. So who's the price determinant over the long term? Don't forget, some of their supplies need to go to their own domestic consumption. More importantly, consider ESG - Europe wants to phase out CPO due to ESG issues, and US banned Topg previously due to foreign worker treatment (but lifted it after Topg improved their treatment and resolved it). So what makes u think that these countries would wanna buy from China, which uses environment-killing coal? Not to mention the US-China trade tension now. Why would they prefer Chinese gloves, if glove purchases constitute such a tiny % of hospitals' expenditure? FYI, Europe and US buy 55-60% of gloves produced globally.

To both groups who have bought and have not bought - good luck.

Let's look forward.

Make Gloves Great Again: Look Forward
Many are asking - why glove stocks are running after reporting huge losses. Simple, because stock market looks forward, not backwards, not even at the present. Usually, most take a 12-month view. Remember Mar-Apr 2020? Many stocks tumbled 50-70% as funds panicked and rushed to sell out holdings, especially tech stocks. On the other hand, retailers believed that although earnings outlook for stocks might be very bad for the next few quarters, but share price has fallen too much. They believed if they invest and hold their nose for 12 months, the outlook will eventually improve, and they could potentially make more than 100%. So they took the bold decision to start buying the stocks way before the stocks turn profitable. Sounds familiar? Let's examine if this is a déjà vu for gloves below:

ASP finally started rising - the one signal the whole market had been waiting for a long time, and now it's here. Harta raised ASP this Feb. Topg has followed suit, and will be raising again in April. Even Chinese players like Intco also said they will start raising in 2Q-3Q this year.

Customers' destocking will end in a few months' time (according to glovemakers), and inventory will go back to normalised level - so no more excess inventory. Once that happens, customers will have to start restocking again. One of the signs was, glove tenders from government and NGOs have stopped for 1.5 years, and recently, Topg saw the tenders coming back from UK, and rising enquiries from other countries. So, if we look forward, glovemakers' utilisation rate/volume could improve.

No more oversupply. All small glovemakers like Mah Sing, Salcon and many Chinese players have exited the market. Semperit also sold its glove business. Not to mention major players like Topg, Intco and Harta have all aborted expansion plans, and in fact, halted a big chunk of their existing capacities.

Costs will likely peak in 1H 2023, and could improve in 2H 2023, because natural gas prices (needed for production) will likely fall in coming months as oil prices have fallen almost 50% from last year's peak. Besides, the worst impact from electricity tariff hike will be effected in 1H 2023. Anwar said "we will only increase tariff for big companies that earn billions of profits". Are glovemakers making billions of profits now? Obviously not. So I believe electricity rates will not rise further for glovemakers in 2H 2023. So, if we look forward, costs could improve.

So how now brown cow? Yes, admittedly things are still not rosy yet right now, but if ASP climbs, volume picks up and cost improves later, doesn't that indicate the worst losses could be over by Mar or Jun 2023 quarter, and things could improve thereafter? So if we look forward and take a 12-month view, can we make more than 100% from gloves this time? I'm not sure, but pre-pandemic, Harta for instance was trading at RM5-7, now it's below RM2. Btw, TOPG, the leader of glove, has just seen MA200 breakout the first time after 2 years.

F China supply. Some may argue, China may spoil market, like steel last time. Consider this difference: more than 50% of steel supply comes from China, whereas only around 20% of glove supply comes from China while Malaysia has 60% market share. So who's the price determinant over the long term? Don't forget, some of their supplies need to go to their own domestic consumption. More importantly, consider ESG - Europe wants to phase out CPO due to ESG issues, and US banned Topg previously due to foreign worker treatment (but lifted it after Topg improved their treatment and resolved it). So what makes u think that these countries would wanna buy from China, which uses environment-killing coal? Not to mention the US-China trade tension now. Why would they prefer Chinese gloves, if glove purchases constitute such a tiny % of hospitals' expenditure? FYI, Europe and US buy 55-60% of gloves produced globally.

To both groups who have bought and have not bought - good luck.

Let's look forward.

Make Gloves Great Again: Look Forward
Many are asking - why glove stocks are running after reporting huge losses. Simple, because stock market looks forward, not backwards, not even at the present. Usually, most take a 12-month view. Remember Mar-Apr 2020? Many stocks tumbled 50-70% as funds panicked and rushed to sell out holdings, especially tech stocks. On the other hand, retailers believed that although earnings outlook for stocks might be very bad for the next few quarters, but share price has fallen too much. They believed if they invest and hold their nose for 12 months, the outlook will eventually improve, and they could potentially make more than 100%. So they took the bold decision to start buying the stocks way before the stocks turn profitable. Sounds familiar? Let's examine if this is a déjà vu for gloves below:

ASP finally started rising - the one signal the whole market had been waiting for a long time, and now it's here. Harta raised ASP this Feb. Topg has followed suit, and will be raising again in April. Even Chinese players like Intco also said they will start raising in 2Q-3Q this year.

Customers' destocking will end in a few months' time (according to glovemakers), and inventory will go back to normalised level - so no more excess inventory. Once that happens, customers will have to start restocking again. One of the signs was, glove tenders from government and NGOs have stopped for 1.5 years, and recently, Topg saw the tenders coming back from UK, and rising enquiries from other countries. So, if we look forward, glovemakers' utilisation rate/volume could improve.

No more oversupply. All small glovemakers like Mah Sing, Salcon and many Chinese players have exited the market. Semperit also sold its glove business. Not to mention major players like Topg, Intco and Harta have all aborted expansion plans, and in fact, halted a big chunk of their existing capacities.

Costs will likely peak in 1H 2023, and could improve in 2H 2023, because natural gas prices (needed for production) will likely fall in coming months as oil prices have fallen almost 50% from last year's peak. Besides, the worst impact from electricity tariff hike will be effected in 1H 2023. Anwar said "we will only increase tariff for big companies that earn billions of profits". Are glovemakers making billions of profits now? Obviously not. So I believe electricity rates will not rise further for glovemakers in 2H 2023. So, if we look forward, costs could improve.

So how now brown cow? Yes, admittedly things are still not rosy yet right now, but if ASP climbs, volume picks up and cost improves later, doesn't that indicate the worst losses could be over by Mar or Jun 2023 quarter, and things could improve thereafter? So if we look forward and take a 12-month view, can we make more than 100% from gloves this time? I'm not sure, but pre-pandemic, Harta for instance was trading at RM5-7, now it's below RM2. Btw, TOPG, the leader of glove, has just seen MA200 breakout the first time after 2 years.

F China supply. Some may argue, China may spoil market, like steel last time. Consider this difference: more than 50% of steel supply comes from China, whereas only around 20% of glove supply comes from China while Malaysia has 60% market share. So who's the price determinant over the long term? Don't forget, some of their supplies need to go to their own domestic consumption. More importantly, consider ESG - Europe wants to phase out CPO due to ESG issues, and US banned Topg previously due to foreign worker treatment (but lifted it after Topg improved their treatment and resolved it). So what makes u think that these countries would wanna buy from China, which uses environment-killing coal? Not to mention the US-China trade tension now. Why would they prefer Chinese gloves, if glove purchases constitute such a tiny % of hospitals' expenditure? FYI, Europe and US buy 55-60% of gloves produced globally.

To both groups who have bought and have not bought - good luck.

Let's look forward.

Vstecs to see all-time-high earnings in FY2020

https://www.nst.com.my/business/2021/02/666163/vstecs-see-all-time-high-earnings-fy2020

Kenanga upgrades Inari TP to RM4.00

https://www.thestar.com.my/business/business-news/2021/01/27/kenanga-upgrades-inari-amid-super-technology-cycle

PDF: https://drive.google.com/file/d/1UB5RSpjZnp2RcXcCCamNW2ThqkHOqsS_/view?usp=sharing

With its share price surpassing our TP, we proactively reassessed our call and decided to upgrade its TP to RM4.00 with confidence. Foreign investors seem to be returning to Malaysia, which puts Inari in the limelight given its large overseas following. With semiconductor shortage everywhere coupled with its available space in P34, Inari is primed to benefit and could likely secure new customers soon. Having expanded its RF assembly capacity from 8 to 22 lines recently (from Sep to Dec 2020), upcoming earnings are expected to be robust. Reiterate OUTPERFORM with a higher Target Price of RM4.00.

https://klse.i3investor.com/blogs/Investment_Ideas/2021-01-27-story-h1540161894-INARI_AMERTRON_BERHAD_INARI_KENANGA_UPGRADES_TARGET_PRICE_TO_RM4_00.jsp

PDF: https://drive.google.com/file/d/1eosVbCfsasaGiL60Ed-k3np3LUYYvWJc/view?usp=sharing

https://www.thestar.com.my/business/business-news/2021/01/08/earnings-boost-for-pie-industrial-on-new-customer-contribution

Kenanga upgraded PIE to OUTPERFORM with higher TP of RM3.30

-Positive feedback in a meeting with management, premised on stronger prospects from a new customer’s entertainment device.

-PIE is supporting 20% of customer’s global demand and is in negotiation to ramp up further as the entertainment device is highly sought after globally and often sold out.

-This trend is expected to continue, driven by the work-from-home practice as lockdown restrictions tighten again owing to the resurgence in Covid-19 cases.

-Current capacity is maxed out with the group looking to expand its floor space (+50%) by acquiring a new plant.

https://klse.i3investor.com/blogs/Investment_Ideas/2021-01-08-story-h1539229722-P_I_E_Industrial_Berhad_PIE_Backed_by_Strong_Demand_TP_RM3_30_by_Kenang.jsp

Acquisition of land 13.8 acres for RM27 million, means something big is coming guys... better catch it now while it's cheap!

https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3113114

- Order-book new high of RM370m as SMIC’s expansion hit full speed, with no signs of slowing
- In touch with Pfizer to understand the use of dry ice to store vaccines.
- PER of 18.7x vs peers’ average of 30-58x
- Target price RM2.30

https://klse.i3investor.com/blogs/Investment_Ideas/2020-12-02-story-h1537357663-Kelington_Group_Berhad_KGB_Orderbook_Surged_on_New_Jobs_TP_RM2_30_26_up.jsp

PDF: https://drive.google.com/file/d/17I5p_skEPEP1N3BeKH-h2u9p5JKW9oSx/view?usp=sharing

- Recorded high earnings in 3QFY20 with core NP of RM8.1 million (+25% YoY) after adjusting impairment and foreign exchange losses
- Order book all-time high of RM370 million (+31% YoY)
- Target price RM2.30

https://klse.i3investor.com/blogs/Investment_Ideas/2020-11-25-story-h1536609045-Kelington_Group_Berhad_KGB_Above_Expectations_TP_RM2_30_35_upside_by_Ke.jsp

The world's now scrambling for dry ice.

https://edition.cnn.com/2020/11/21/world/coronavirus-vaccine-dry-ice-intl/index.html

Still cheap at 19.9x Fwd.

https://klse.i3investor.com/blogs/Investment_Ideas/2020-11-16-story-h1536435046-Kelington_Group_Berhad_KGB_All_Stars_Aligned_TP_RM1_92.jsp

Wow what's cooking?

跑赢大市 :D :D :D

https://www.chinapress.com.my/20201110/%e2%97%a4%e8%b0%88%e8%82%a1%e8%ae%ba%e5%b8%82%e2%97%a2%e6%bd%9c%e5%9c%a8%e7%9b%88%e5%88%a9%e9%81%ad%e4%bd%8e%e4%bc%b0-%e7%a7%91%e8%89%ba%e6%9c%ac%e7%9b%8a%e6%af%94%e5%ba%94%e6%9b%b4%e9%ab%98/

Dry ice demand up, KGB earnings up up?!

https://klse.i3investor.com/blogs/Investment_Ideas/2020-11-11-story-h1536369605-Kelington_Group_Berhad_KGB_Vaccine_to_Boost_Dry_Ice_Demand_TP_RM1_92.jsp

PDF: https://drive.google.com/file/d/1DY34aBEv0B8LhEcQgaQ7MqXdQL0DH-o2/view?usp=sharing

Need dry ice to pack with vaccines, KGB doing dry ice business leh

https://www.nbcnews.com/business/business-news/pfizer-readies-herculean-effort-distribute-coronavirus-vaccine-n1247147

PDF

https://drive.google.com/file/d/1OEP_ZItmVDbpebkrCfzUSfaKxutt9l-S/view?usp=sharing

KGB Initiation Report

https://klse.i3investor.com/blogs/Investment_Ideas/2020-11-09-story-h1535691227-Kelington_Group_Berhad_KGB_Initiation_by_Kenanga.jsp

- Sentiment overhang on SMIC (35% of KGB's orderbook) cleared.
- Orderbook at all-time high of RM386m.
- Trading cheaply at 15.6x fwd PE, as compared to peers’ average of 30-58x.

Western Digital pledges RM2.3b investments in meeting with PM.

I think this counter gonna fly man...

https://www.theedgemarkets.com/article/pmo-western-digital-invest-rm23b-facilities-capacity-expansion

TP RM1.30, still cheap

https://klse.i3investor.com/blogs/kenangaresearch/2020-09-03-story-h1513312332-Optimax_Holdings_Eyeing_Expansion_to_Boost_Growth.jsp

最好的情况来看，给予2.75令吉目标价 :D

https://www.enanyang.my/%E8%A1%8C%E5%AE%B6%E8%AE%BA%E8%82%A1/%E3%80%90%E8%A1%8C%E5%AE%B6%E8%AE%BA%E8%82%A1%E8%A7%86%E9%A2%91%E3%80%91%E6%8D%B7%E9%93%B5%E7%A7%91%E6%8A%80-%E6%8B%93%E6%96%B0%E8%B4%A2%E6%BA%90%E5%89%8D%E6%99%AF%E4%BA%AE%E4%B8%BD

Tmr will open 1.60

Kenanga giving a TP of RM2!! Double digit growth earnings soon. Huat ahhh

https://klse.i3investor.com/servlets/staticfile/392638.jsp

Results damn power

Amukutty 0.19

They are gonna hit their 52 week all time high soon!

After breaking the resistance of 16sen, momentum seems to be strong and positive.

Not involved in the reinstatement only ma.. overacting 99 hahahaha

Like some said, those who kena were really using T+3 facilities.

Undervalued counter with strong business prospects going forward, huge upside man

https://www.thestar.com.my/business/business-news/2019/03/19/aminvest-research-starts-coverage-of-qes-fv-34-sen/

Share price dipped 10% after being removed from shariah compliant list. Apparently their cash to total asset is beyond 33% hence not shariah compliant. Hmmm

Clarification of the land gain sale and the claims of arbitration case.

https://file.fm/f/e37vrnf5

https://file.fm/f/daeff5te

Net impact: Sales from land disposal of RM25 mil - Arbitration loss case of RM24 mil = RM1 mil, still a positive gain.

LaoTzeAhSir How about the claims of the arbitration case? Crest Builder was awarded RM31 mil (RM25 mil has been recognized previously) while the awarded employer's counter claim is RM30 mil.

All in all, this quarter recognizes RM6 mil (RM31 mil - RM25 mil) as gain and RM30 mil as loss, which translates to a negative of RM24 mil.

Net impact: RM25 mil - RM24 mil = RM1 mil, still a marginal gain. Crest Builder's reported earnings are core.

At a current price of RM1.09, the stock is trading at 4.7x PE based on annualised 1H18 metrics, which represents a 33% discount in view of a conservative 7x PE for small-cap construction stocks. Assuming 7x PE, the indicative price is RM1.62/share!!

Technical picks from AmResearch as well

https://files.fm/u/97acst64

Crest Builder Solid Growth Prospects by RHB Research - TP RM1.77

https://files.fm/u/3j7rynef

RHB Research wrote a non-rated report with a target price of RM1.77

This counter is like the cheapest stock in terms of valuation, strong earnings with fundamentals intact. Hope Crest Builder can continue to deliver more in the future. :)

Wow, nice TP upgrade to RM1.90 by Credit Suisse!

Woah, results damn power!!

I heard from my manager a big overseas company negotiating to buy our company at 1.8.. Hopefully go through.. Sell all my ESOS to u all XD