Brother Calvintaneng,

Can you please enlighten me.
If there is bonus issue of 1:1 for Top Glove, how is the C74 issued by the IB adjusted. Take the example of Top Glove ex-price of 16.38 and C74 ex-price of 1.41 .

Tks in advance.

The prevailing theme is Glove stocks. Easy to follow herd mentality and blinded by the fundamentals of the company.

Numbers don't lie.
Supermax last quarter EPS 5.42
Careplus last quarter EPS 0.21
Study carefully the vast difference.

Action also don't lie.
Supermax director and related parties are still buying its own shares at such high price.
Careplus director is disposing its own shares.

Just seek professional advice and be caution.

Talking about call warrants, longer expiry date is always preferred if the premium is about the same. C74 and C75 have about the same premium but C74's expiry date is 2021-03-22 while C75 expiry date is 2020-11-30. With additional about 4 months longer expiry, C74 should be safer than C75.

To dhnn81,

Both TG and Supermax are the 2 top picks. Invest 50% each is my suggestion. Thats what I do.

Happy investing.

I believe Bonus Issue or share split of Top Glove is imminent in the prevailing conditions of higher share price.

IBs had unfairly taken concerted efforts to bend their own rules and apply capping on the price of Top Glove at 35% price cut on market closing or capped price of RM8.64 whichever is lower.

To circumvent this constraint, declaration of bonus issue of 1:1 or share split of 1 to 2 will halve the share price. That will bring ex share price of Top Glove to within the range of RM8.64.

Not only the liquidity of the stock is enhanced, the trading capacity of the margin traders are restored.

Lets see then if the IBs will do another round of recapping.

Haha, 635789 you hit a good point.

First quarter included March, operating under 1 full month with the blow out of Covid-19. Demand for Gloves had started to pick up aggressively worldwide , puzzling how to justify reduction in Revenue ?

Under the same quarter, Supermax saw an increase of 16% of revenue and more than doubling of net profit.

No logic.

Just be caution.

Careplus share price could be overvalued.

Please do a simple arithmetic and I used Supermax for comparison.

Supermax last quarter EPS-5.42
Careplus last quarter EPS-0.21

Supermax's EPS is 5.42/0.21=25.8 times Careplus. Or Careplus EPS is 0.21/5.42=0.0387 times of Supermax. Hence, if Careplus closing price today of 1.63 is fair, then Supermax should trade at 25.8x1.63=42.05. Conversely, if Supermax's closing price of 8.88 is fair, then Careplus should trade at 8.88/25.8=0.344.

Therefore, please trade with caution. Do not blinded by the special dividend declared.

Please take note Top Glove which has a higher EPS is trading at much higher price than Supermax.

If you agree on this rough estimate, then we can also roughly gauge the fair prices of all Glove counters instead of blindly chasing.

Personally I strongly think that it is unfair for the IBs(Investment Bankers) to place the price caps on all Glove counters.

Look at the TPs coming out from themselves.
Top Glove Maybank 20.00
Kenanga 15.60
Supermax RHB 10.50
CIMB 9.80

So at the current price levels of Top Glove and Supermax which are still trading below their OWN TPs, what justifications do they have to say that the current prices are crazy to support them putting a price cap ?

IT is only fair that they do their own research and imposed margin caps on some counters and not across the board

Whoever wants to differ, I think this counter is not a good one to invest at the moment. Because the main shareholders have placed their own interests above all the small shareholders. There is nothing wrong for their actions but the small shareholders can do nothing but just wait until they stop doing so.

Reasons:
(1) All the major shareholders have in their possession huge amount of FREE warrants.
(2) It is in their own interests for them to dispose off the warrants in the early stage and used the proceeds to part finance the purchase of mother shares which is still low after the Private Placement.
(3)It is not beneficial for them to allow the mother shares to move higher because the small increase in warrant price cannot outweight the much higher quantum of price movement of the mother shares.
(4)Therefore, even after a commendable quarterly results ending 31st March and rebounding crude oil, the share price continued to be restrained by the hidden hands (May be by the main shareholders and directors themselves) to enable their purchases to continue.
(5)The main shareholders clearly do not seem to harbor the intention of converting the free warrants to mother share with RM2.62 conversion price 4 years later.
(6)Meanwhile, the small shareholders have to wait in patience until the actions of main shareholders stop.

Personally, I concurred with the recommendations of some investment bankers and exposed quite heavily into this counter before. I held a lot of mother shares and warrants during PP. I quickly disposed off everything after I saw what the main shareholders and directors did. Nothing wrong but I just disliked it. I poured my funds into some glove counters and I am now reaping some benefits instead of waiting.

No doubt may be soon this counter will move higher but personally never for me with this company anymore.

All the best.

There is certainly clear correlations between warrant and mother share. Today's warrant price movement is not natural and defies logic. There is clear manipulations by party or parties holding huge amount of warrants. There was also clear manipulations of mother shares before and after PP. Hopefully the shareholders and directors are not involved.