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KUALA LUMPUR (June 4): Credit Suisse has raised its target price for Top Glove Corp Bhd to RM23, more than double of RM11.30 previosly, on the ground that there has been a recent rise in ad hoc and spot orders by government agencies needing urgent deliveries.

In a note dated June 3, Credit Suisse analyst Joanna Cheah said while pricing was not locked in upfront for these volumes, the group took deposits between 10% and 30%, based on projected average selling price (ASP) increases depending on the expected month of delivery and thus, Top Glove had decided to allocate 10% of its capacity for these spot orders.

"Given the long lead time for normal orders, it is therefore no surprise that ASP for the ad hoc spot orders is much higher.

"According to management, some of these orders were priced above US$100 per 1000 pieces, which is more than three times higher than the current blended ASP for the normal orders," Cheah said.

In addition, while the company was previously guiding for 5%-10% increases in ASP every quarter, given the further squeeze in demand-supply for gloves, it was now guiding for a monthly double-digit ASP increase at least for the next two months.

"Given the revised strategy and ASP guidance by the company, we have raised our FY20 (financial year 2020)-FY22 earnings per share by 20%-135%. We now expect the group's earnings to grow 182% in FY20, a further 122% in FY21 but decline by 63% in FY22 as ASP normalises.

"Our earnings forecast assumes that ASP will rise by 20% in FY21 for both nitrile and powder-free gloves, and decline by 20% in FY22," she said.

She added that Top Glove's results for the third quarter of FY20 set to be released on June 11 are expected to be strong and should drive further rerating of the stock.

"One of the key concerns has been the risk of oversupply as the rubber glove players embark on expansion and demand settles post the pandemic. Looking at the current planned supply by the top five major players (including Sri Trang), we think there will be a squeeze in demand-supply for the next two years," she said.

Just yesterday, the price-earnings valuation of Hartalega, Top Glove and Rubberex breached the 100 times mark, which is rarely seen among manufacturing-oriented companies.

She noted the current demand is estimated to be 50%-60% higher if not for capacity constraints resulting in long lead time.

Meanwhile, estimated supply is expected to grow by 9% cumulatively between now and end-2020 and another 12% by end-2021.

At the midday break today, Top Glove rose 1.49% or 22 sen to RM14.92, valuing it at RM39.25 billion.

#dudukrumahdiamdiam and get the news at theedgemarkets.

KUALA LUMPUR (June 4): Credit Suisse has raised its target price for Top Glove Corp Bhd to RM23, more than double of RM11.30 previosly, on the ground that there has been a recent rise in ad hoc and spot orders by government agencies needing urgent deliveries.

In a note dated June 3, Credit Suisse analyst Joanna Cheah said while pricing was not locked in upfront for these volumes, the group took deposits between 10% and 30%, based on projected average selling price (ASP) increases depending on the expected month of delivery and thus, Top Glove had decided to allocate 10% of its capacity for these spot orders.

"Given the long lead time for normal orders, it is therefore no surprise that ASP for the ad hoc spot orders is much higher.

"According to management, some of these orders were priced above US$100 per 1000 pieces, which is more than three times higher than the current blended ASP for the normal orders," Cheah said.

In addition, while the company was previously guiding for 5%-10% increases in ASP every quarter, given the further squeeze in demand-supply for gloves, it was now guiding for a monthly double-digit ASP increase at least for the next two months.

"Given the revised strategy and ASP guidance by the company, we have raised our FY20 (financial year 2020)-FY22 earnings per share by 20%-135%. We now expect the group's earnings to grow 182% in FY20, a further 122% in FY21 but decline by 63% in FY22 as ASP normalises.

"Our earnings forecast assumes that ASP will rise by 20% in FY21 for both nitrile and powder-free gloves, and decline by 20% in FY22," she said.

She added that Top Glove's results for the third quarter of FY20 set to be released on June 11 are expected to be strong and should drive further rerating of the stock.

"One of the key concerns has been the risk of oversupply as the rubber glove players embark on expansion and demand settles post the pandemic. Looking at the current planned supply by the top five major players (including Sri Trang), we think there will be a squeeze in demand-supply for the next two years," she said.

Just yesterday, the price-earnings valuation of Hartalega, Top Glove and Rubberex breached the 100 times mark, which is rarely seen among manufacturing-oriented companies.

She noted the current demand is estimated to be 50%-60% higher if not for capacity constraints resulting in long lead time.

Meanwhile, estimated supply is expected to grow by 9% cumulatively between now and end-2020 and another 12% by end-2021.

At the midday break today, Top Glove rose 1.49% or 22 sen to RM14.92, valuing it at RM39.25 billion.

#dudukrumahdiamdiam and get the news at theedgemarkets.

Sanitazer seller

1 day game

Hit 0.20 this week

Aku target hit 25sen

Warrant issue 61 juta je. Ringan nak Naik ni.

Euro take over offer price 0.200 after take over hit 0.700 look great.

Euro also low nta but it price now incredible. Don't look nta.buy for the future. Before it hit 0.400 better buy before late. Yeehaaaa

Owh that why some people want to take over his company. They can get guarantee profit in the future. Tp1 price 0.500 hold your share. This company will touch 1.00

Bukan ikan jerung ikan bilis Jual. Ikan jerung belum Jual. Tunggu AGM take offer. Dah jerung dapat dia Jual la

Wat?! they offer warrant 10 cent ohhh warrant will fly to 0.20cent. sapu all

Ok buy call

Some one want take over will be like euro

Hit 0.25 tomorrow China healthcare company gain cause by covid

Covid-19 is good for economy

Imedic service coming. Many doctor was effect. Doctor will consult with imedic app

To 0.300 juz hold fair price

Juz buy covid attack China again . Imedic from ucrest will active there.

Imedic servos hot now. Tunggu 0.30

Juz sell

Buy...buy...

Follow lkl n careplus. Hoyeee

Aku dah cakap chairman takda duit nak beli share. Share ckit boleh Jadi chairman. 10 percent pun tak sampai. Harap org lain boleh take over Jadi chairman

Please anybody retailer investor take over this company. CEO takda duit markup company share value. 2 juta value share pun boleh Jadi director Ka. Ayoyo

Adoiii project bilion2 mcm mana CEO hold 2 milion value share saja. Taik2 10juta value share. CEO pun miskin.

Ha..ha.. Kasi tidur ini director.

Wah still cheap. Buy slowly. Director juz have 5percent share. If we get 7 percent will becoming new director. Director no more money to buy share. Dato awang Kasi hentam ini company. Take over this company

Gogogo..... Datuk main2 Sama contra player. Orang Kaya awang target 30percent share from minetec. Baru 19percent share tak cukup la.

Tok awang main Sealink Ari ini. Sealink Naik tinggi sudah

Minetec have something latok awang want. I think many project will coming soon.

Minetec baru bangun tido belum jalan cuci Muka. Lepas itu dia lari tak dpt keja lagi owh.

Waiting touch 0.600. ini latok dia simpan Lama sudah touch 0.600 baruk jual. Dia punya team sudah masuk minetec. Tengok 1 tahun ini company tiap2 quarter profit. Will become 1 batang satay kajang punya harga.

Today datuk makan semua org Jual Kalu sudah abis up again tomorrow

Tp 0.300

Keep guys

Wow something wrong with this stock. Mr chairman and son on the board. Serbadinamik founder become chairman. Will rocket this stock. Wind of change.

Hari2 makan telur

Buy more when at below 0.900cent

Tp 0.360

Ansell coming. This month will rocket up

31 Mac last call

Tp 0.50 waiting Ansell take over

Tunggu Ansel take over. Setup Dulu sebelum terbang

Urusharta dah ambik balik mcm Ada good news ni. Kita tunggu.....

Wah tp 0.20 mcm brahim pn17 pun 0.20 upper.

No chance to touch 0.110 they have back licence from Petronas. Jus waiting announce regulation plan out from pn17 tabung Haji still support this company. Fair price 0.200 in 3 month time frame.

Sulah Jual. Luigi lo....bye2 tgk VC pulak

Lain mcm trend