Ops, the last paragraph should be Earning pet qtr
not per year

Lets check if next qtr can hit 1.3 billion profit. Supermx has two type of business. One is OEM/Disty while the other is OBM . The OBM is 58 % of total gloves sales while the balance 42% is through OEM/ Disty .
The OEM/ Disty is straight forward. Supermx product mix is 68 % nitrile and 32 % latexx. Assuming ASP. for Nitrile.glove exfactory is US 70 per 1000.and Latexx glove is US 40 per 1000 , the weighted ASP is 70x0.68 +40x0.32 = 60.4.
Assuming capacity of 26 billion per year , utilization.of 95 % ,exchange rate of 4.1 and margin of 40 %,

OEM/Disty earning = 60.4 x 26x 0.95 x 4.1 x 0.4 x 0.42 = 1027 millions

For.OBM.business , I assume supermx sold double the price of ex factory price and make a total margin of 60 % ,

OBM earning = 60.4 x2 x26.x.0.95 x 4.1 x 0.6x 0.58 = 4257 millions.

Total earning per year = 1027 + 4257 = 5284 million.
Earning per year = 5284/ 4 = 1324 millions.

newway , thks for the information

Whenarmada, I agree with Pang72 that 6.00 is an east tgt to achieve. Supermx is worth.much more than.that.

Uplanet, Supermx last 2qtrs earnings were 790 millions in Q1 and 1056 millions in.Q2 . To achieve 4.5 billions in total , the next 2 qtrs must achieve achieve 2654 millions or 1327 millions per qtr. Can supermx achieve 1327 millions profit in.coming QTR? Lets do a reality.check.

What is so good about DIY fundamentally? It was just listed and had a 2 qtr history of financial results. Which. MRDIY business fundamentals are better than supermx? Growth.rate for the past 5 years? Cash.position? Nett Margin, ROE? Future earning. potential? Technological advantages? Workdwide.customer base ? I cant see any of these can beat supermx. DIY is definetely.overpriced . If such a company with these fundamentals can have a PE.of 60 , then.supermx deserved a PE.of 100. Welcome any comment . Pang 72, I am helping you to get more peoples into the forum .

JP Morgan tried to misled the investors by stating that the ASP will revert back to US 30 per 1000 but did not indicate the timing of when? Based on Frost and Sullivans research a few months ago, the ASP for nitrile gloves will goes down from the peak of 85 in 2021 to US 53 in.2022, US 35 in 2023 and US 30 in 2024. The drop is gradual instead of abruptly due to demand is still higher than supply. Based on.Ben.Tan yestetday article which quoted Premier's information, the demand still exceeded supply by as much as 250 billions pcs. Taking today worldwide capacity of 420 billions , it means that the average leadtime is still exceeding 200 days ( 250 /420 x 365 days ). The article.also mentioned that the challenge of meeting the demand will last until 2023 . JP also failed to mention the aggressive capacity expansion which will mitigate the drop of ASP . Topglove will triple its 2019 capacity in 2024 while supermx will double its capacity in 2022. Another point to note is that ASP of US 30 is still 30 % higher than the 2019 ASP of US 23.1 .

In another 2 to 3 weeks, Supermx,Harta and Kossan are expected to announce record results from higher volumes and ASPs than previous qtr.

I am happy my conviction.and perseverance pays off . I have added Topglove and supermx when they were below.5 and 4.5 respectively. I have also bought some Harta at below 9.50 . It is as if the markets suddenly.discovered the values of glove stocks after 6 months of downtrend.

In the last report ,RHB expected special dividend from Supermx . BIMB projected 67 sen dividend from.supermx in 2021. This is equovalent tomore than.13 % dividend yield at current price.

Supermx had increased its capacity from 24 billion per annum to 26 at the end of .2020 and continue to increase to 36 billion by end of 2021 and 48 billion by end of .2022. This doubling of capacity within 2.5 years is very aggressive. It has increasing profits for the last 6 qtrs and on the way to achieve.consecutively.7 qtrs of increasing profits. Its PE fir rolling 4 qtrs will be below 4 . It is a net cash company . Supermx is a company with solid fundamentals. Its share price at 4.56 is really a steal.

I think the next QR will be at the end of this month or first week of May. I expect another record profit . This is accomplished with higher volume and higher ASP. With the coming record profit, The PE ratio will be less than 4 . I also expect a good dividend announcement.

Unlike other glove companies, Supermx glove business comprises the ex factory to distributors business plus its own.OBM.distributor business. This OBM business account for additional 40 to 50 % of its ex profits from.factory sales . Based on.kenanga estimated ASP of US 70 per 1000 ex factory price, we can expect.the coming qtr profit to be around 1.1 to 1.2 billions.

Uplanet, Oh, I m not aware . The last time I talked to him was 20 years ago on D & O business when he told me.he had a beer business in Cambodia. I m not aware he had sold his business to Carlsberg. You are more updated .

I think the Chairman does has good relationship with Cambodian PM . 85 % of Don.Sahong power is being sold to Cambodia . MFCB also had a land concessions of 9500 hectars planting coconuts. He also has a beer.business in.Cambodia. With proven record , We hope mfcb will.get another similar hydro power project in.Laos.

i3.gambler. Thanks for the clarification.
Some of our assumptions.are the same while some are different. We both used the same utilization.rate of 85 % . I used 2024 as post pandemic while you use 2025. The other difference is Nitrile vs Latexx ratio. I used 70 /30 while you may use different ratio. Topglove had converted many latexx lines to Nitrile and new capacities are predominantly Nitrile which has.higher ASP and margins. I used margin of 20 % vs your 10 % because of 30 % higher.Nitrile ASP in 2024 at US 30.5 than.ASP of US 23.1 in 2019. I used a lower PE of 22 vs your 30.

i3 gambler , may I know how you get the US 21.5 in 2015 ? Is this the price of nitrile glove or latexx gloves? I found the nitrile prices on Frost and Sullivans ASP projections are US 30.5 in 2024 and 27.2 in 2025 while the latexx prices are US 19 in 2024 and 18.5 in 2025 . May I know what is your assumptions on the ratio of nitrile and latexx gloves in Topglove ? I.used 70 % Nirile.in 2024 and 30 % latexx. Also, topglove capacity is projected at 205 billion in 2024 not 2025. Topglove capacity may be 10 % higher in 2025.

i3 gambler , I beg to differ . I refer to Frost and Sullivan projections from Ben Tan.article . The 2019 nitrile price was US 23.1 per k while the latex glove was US18 . I do not think 6 years later the Nitrile price will.drop to 21.5 . The yearly inflations of 3.5 to 5 % will make glove prices higher rather than lower. If you compounded at 4 % inflation rate for 6 years, the price increase will be about 30 % increase. Anyway both are projections 。It is a question.of judgements.

invest malaysia, pls read the article from HLI.dated 6 April titled key takeaways from.MARGMA meeting. There are 4.key points. The first is regarding capacity expansion by China glove manufacturers. It is not a concern as this.capacity.add will be taken.up by domestic demands since China per capita usage is still.very low at 6 pcs . The second is on.ASPs post pandemic. It is projected to be 40 to 60 % higher than pre pan demic ASPs. The third is on local new players capacity which is expected to be 6.5 billion to 10 billions per year. This is negligible against the total world capacity of 420 billions in 2021 .Till today , none of the new.players has started production . The fourth takeaway is on foreign workers freeze which might impact the overall glove industry. The over supply issue should not arise.

Invest Malaysia , agreed with you we need to look at the future or the post pandemic . I am.aware of 3x pre pandemic price but come 2024 , Topglove.capacity will also be 3X of 2019 capacity. Moreover, according to MARGMA, the post pandemic ASPs of gloves will be about 40 to 60 % higher than pre pandemic ASPs. I have done a calculations last week based on these data, the earning in 2024 is still more than 10X of 2019 earnings. I give a PE of 22, the tgt price is still 9.90. The question of over supply does not arise based on MARGMA projection of 12 to 15 % annual growth rate post.pandemic. This is 50 % higher than the 8 to 10 % growth rate before pandemic.

Invest malaysia , we need to look at facts so that we can compare which stock is more recession.and pandemic/epidemic proof. Lets look at Nestle and Topglove financials for 2003 and 2020 respectively. The revenues and.profits of Nestle and Topgloves are as follows
Nestle Topgloves
Rev Profits Rev Profits
2003 2658 m 162 m 264 m 25.2 m

2020 5411 m 551 m 14921 m 6885 m

Growth 2X 3.4 X 57 X 273 X

The above data shows that Topglove growth rates are much much higher than Nestle for the past 18 years. I do not understand why Mr markets give such a high PE to Nestle but not Topglove when the latter 's earning growth is 80 X more than Nestle. The irrationality is just too obvious.

Invest malaysia , topglove and other glove counters are also recession.and covid proof . Pls look.at the past 20 years records . The 4 glove.counters are Sars proof, H1N1 proof and Covid proof beside recession proofs.

gohkimhock , nobody suggest Topglove to take on.Nestle. It is just a comparison between the.fundamental matrixes. You are.free to promote Nestle and buy at rm 136 with.PE of 57.7 and DY of 2 % if you think Nestle is few class.above Topglove. I prefer to buy topglove at PE of 6.23 and DY of 8 % despite having.the ESG issue. It is just a question of your judgement vs mine.

i3lurker, I seldom eat instant noodles nowadays. I prefer Korean or mamee because of its curry and spicy taste plus the noodle textures. What do you mean by controlled counter? Why peoples are willing to pay Nestle with PE of 60 when its growth rate is so small ?. Its DY is not that attractive also.

Invest malaysia, hope you can see the irrationality of " markets" on Nestle versus Topglove and other glove counters. This.market irrationality and imperfection will be Corrected sooner or later . The room for growth for gloves are huge with future demand coming from highly populated low usage countries. The big.hawks are watching and aiming at these big pieces of meat . At the right timing, they will snatch up .

Gemfinder and Invest malaysia, Frankly, I do not buy any Nestle products . I prefer Mamee or Korean instant noodles than maggie mee. I dont take Nescafe as I prefer other coffees. I also dont like Nestle chocolates and Nestum. Hershey and Quaker oats are better . I can live without Nestle as there are hundreds of alternatives and competitors.
You cant grow food consumption by asking peoples to eat 12 to 15 % more.every year . The earning growth of Nestle is mainly organic growth due to price inflation plus one or two new products .Unlike the food industry , gloves can grow between 12 to 15 % per year by growing the per.capita usage from 10 to 300 pcs from the 5 to 6 billions peoples who stay in.the less developed countries.

Gemfinders, gloves are necessities for medical industries like hospitals, clinics, dental clinics, food and beverages , food and pharmaceutical manufacturings , aviations . The meaning of 300 pcs usage per capita in US means on.average one person is using.300 pcs per year .

Yeo HS sell canned food like sardine , bake beans, curry chickens etc beside drinks . Dutch lady sells milk products yougurts etc. These products.are food products compete directly.with Nestle products like , Milo ,milks , yogurts etc. Go to groceries and check.. Every Nestle products, there are many competitors of different brands.

Gloves are necessities just like food . Nestle is a top brand in food industry and has been in Malaysia for decades . There are many new competitors like Dutchlady ,Yeo HS, F.&N, Mamee , power root etc but Nestle continue to grow. Topglove is not.only.top in Malaysia but top in the whole world. Before the pandemic , gloves usage are growing between 8 to 10 %. During pandemic , it grow between 20 to 25 %. Post pandemic, it is projected to grow between 12 to 15 %. It is your judgement whether it is good to invest in Topglove. I wonder why market can give a PE of 60 to Nestle which grow at the rate of 5 % for the last 20 years but have to " punish " Topglove with a PE of less than 20 when Topglove earnings had grown more than 25 % in the last 20 years . Can someone tell which fundamental of Topglove is not as good.as.Nestle . Are the fears unfounded?

gemfinder . Long term are like those who bought 2000 shares of topglove at rm 5400 in 2001 and kept them for 20 years until today and they are worth rm 576000 x2 = r m 1,152000 today .

geary . thks for the reminder on the risks of using margins to purchase stocks. I think kyy was.burned by margin calls on his jaks, dayang and supermx .

Excluding China, the total populations of India , Africa , Latin America , Indonesia, Thailand , Myammar , Vietnam , Bangladesh ,pakistan are 5X of Total population of US, EU plus Britain and Japan combines. These countries need more gloves since they will get their vaccines much slower than US and EUs. The usages of these highly populated countries are only 1/25 of those developed countries. This pandemic will.accelerate the growth of glove usages as these are basic necessicities in preventing covid 19 transmission .

greenland , As per Topglove presentation in Feb , Netheland is 317 , USA 300 , Japan 133 , Philipines 14 ,China 9 and Indonesia 6 pcs per capita . The rooms for growth is tremendous for these high population countries. I remembered India usage per capita is also below 10 and.Brazil is below 30.

The good news is workers activist ANDY HALL is speaking on.behalf of Topglove now. He said that Topglove has made many positive improvements towards workers welfare. He even question why CBP did not lift the ban despite many corrective actions were taken and started questioning CBP why it target.topglove when there are so many others have worsed workers rights violations. Who.knows one day.a CBP worker may work for Topglove America ?

Geary and balance views, thks .
Under such market environments in the last 6 months , we need convictions and perseverance to be able to hold glove stocks and add more when.they are extremely undervalued. I actually break my own principle and use margins to.add more . My own valuations had helped me a lot to be greedy when others are fearful.

Pankaj kumar.said stock.valuations is an.art . I like to project and forcast values of stocks based on some assumptions. So I calculate from.left to right, from right to left , from top to bottom and from bottoms up . No matter how I calculate the values of top glove is more than 7.50. I Calculate until my calculator overheated... still more than rm 7.50 . Si I am convinced Topglove is undervalued even at current price. By the way , I do calculate and value supermx and harta . They are undervalue too . I decided not to publish my valuations for these two stocks . I added both supermx and topglove yesterday.

Wow, big rally for gloves counter today. All my topgloves , supermx and harta went up by almost 10 % on.average .

newway, TGuy88 , thks for the comments.
Yes. Topglove will be in net cash position in 2024 which is a much better position than in 2019 and before . It deserve a better PE of 22 which I conservatively assumed. The historical average PE of topglove was 26 from 2015 till 2019 .

Today, I read with interest on the report by HLI about its meeting with Malaysia glove.association or MARGMA . Based on the report , the ASP s of gloves post pandemic will be about 40 to 60 % higher than pre pandemic . I think this is a reasonable assumption due to greater demand arising.from.higher hygiene awareness plus organic ASP growth from inflation.
Lets assume the.post.pandemic will happen in 2024 . The ASPs for.Nitrile and.Latexx gloves during prepandemic 2019 were US 23 and US 18 per 1000 respectively. Assuming a 50 % increase in price and topglove capacity is 70 % nitrile and latexx is 30 % , the weighted ASP is

( 23 x 1.5 x 0.7 ) + ( 18 x 1.5 x 0.3 ) = US 32.25

Assuming the average capacity in 2024 is
(178 +205 ) /2 = 191 billion , then its earning for 2024 is
32.25 x 191 x 0.85 x 4.1 x 0.2 = 4.293 billions
The other assumptions are
Utilization 85 % , exchange rate 4.1 and net margin of 20 %.
With 9.5 billion shares after HK listing , the eps is 4.293 / 9.5 = 45.2 sen .
Assuming a conservative PE of 22
, its price is rm 9.94
This is double the current market price.of 4.91 .
Using the rule 72 , doubling.of price in.3 years is 24 % CAGR . Total return per.year will be 32.% assuming average dividend yield of 8 % per year for the next 3 years .

Feel free to comment on my assumptions and calculations.

Ultrabot, I took the data published by John Hopkins University. Based on.the latest numbers , US had 31.5 millions infected and 570 k deaths. China has 90 k infected and 4.6 k deaths. You dont trust these numbers? Then what is your numbers and.where you got them from ?

In 2020 , China is the only.country with GDP growth of 2.3 % while the rest of the world are negative growth ? You dont belive this number also ?
In the last 20 years, US has invaded numerous countries which include.IRAQ, Libya, Afghan , Syria etc. This invasions killed 800 k civilians and displaced almost 4 millions innocence who become homeless . You dont believe such.atrocities committed by US and its allies?

Do you know the meaning of hypocrisy? Did China go around telling the west on human right issues pepetrated by US and its allies ?. China never Sanction others on human right issues. It is always US and its allies blaming others on human rights while forgetting they are the worst kind. This is called HYPOCRISY. understand ?

There is a Doctrine in.British law called Doctrine of CLEAN HAND. When your hand.is not clean and filled with blood, you cannot claim and.sanctions others of committing human rights violations. The west should stop behaving like holier than thou and think they are tge SAINTS .They must first clean up their own hands which are filled with bloods before pointing fingers at others .Like What Yang Jieche told off Blinken in the meeting in.Alaska. " You are not qualified to talk to me on the position of strength" . ""Go and.clean up your own mess in your country while we will.clean up our own.""

Ultrabot, many are fascinated by western system of freedom , democracy , check and balance etc thinking that the system will ""self correct "" and elect the best leaders. The facts speak otherwise. The US elected D Trump who was a few times bankrupt and zero experience managing a district not to mention.a state. Look at how he lied on actions to.contain.covid pandemic. He dont follow the scientific methods but used his emotions to contain the pandemics. The result is disastrous with almost 3 millions infected and 570k.death . This is 400x worst than.China . Who is.ACCOUNTABLE for.such high infections and death? D. Trump and.his team ? Singapore had weak opposition and.never change.party to rule . Does it has higher corruption.than malaysia which has much.stronger opposition.? Democracy does not really bring.progress to the country. Another good comparison is India vs China. Both gained independence almost at the same time but practise.different.system. Look at the difference today .Results speak louder than rhetorics.

Abba84, China central bank did the right thing.by stopping the Ant IPO. If Ant s business is lending money , it had better follow the banking laws . ANT IPO will not be approved by US banking laws too after they experienced the 2008.of financial crisis which bankrupt almost.all the big banks plus the insurance companies. Jack Ma can.try to IPO ANT group in the US if he think.US is less stringent . Try and see and I wish him good luck.

Based on.Maslow Hierachy of needs, the most basic human rights are the rights to have food , clothings and shelter. The Chinese have the rights to choose what food to eat,what clothes to wear and what house to buy and which place to stay. The government has also improve the basic infrastructure and basic utilities such that the residents had basic sewerage system , drainages and roads. On the second level of needs or wants, the Chinese are free to travel , to choose types of transportation be it by road on buses , by cars, by train or by airs. On.educations , they are free to.choose types of schools or universities .On personal freedom, they are free to choose who to marry , free to have types of leisures and hobbies, free to choose their beliefs. In fact , women in China has more rights than their peers in other countries. They can drive , choose their.spouse and move freely at night . The residents in.India, pakistan , Bangladesh, middle eastern.countries and some other south east asian may not have so much human.rights.and freedom as those in China.

TQ Geary and Titan 3322 for the trusts . I will continue to voice my opinions and comment and rebut on half truth , double standards and hypocritic messages so that forum participants can.see another side of the story and make their own judgements.

ultraboat , cotton picking jobs are seasonal not every month . Once cotton is ripe for harvest you need to pick it fast before it get damaged . Other months , the cotton pickers may do other jobs which has lower wages . China per capita has reached 10k US which is slightly lower than Malaysia. Xinjiang GDP per capita is about US 8 k or 54, 000 yuan. This is equivalent to 4500 yuan per month. For your reference , both India and Bangladesh per capita us less than US 2000. Xinjiang peoples are 4 X richer than average Bangladeshi and Indians.

The Hans and Uyghurs cotton pickers earned about 5000 yuan per month are considered "forced labour " but Nike workers in.Cambodia and Myammar were paid 15 cts per hour but not considered forced labour. US and western countries put on sanctions on Xinjiang cotton to punish the whole industry so that the Uyghurs will be out of job.

Remediation for workers who did not manage to come to Malaysia due to covid related lockdown. Is this considered " Forced Labour" ? What remediation.efforts? Compensate them ? Work with the governmrnts to bring them in to Malaysia by hook or by crook ? Does US government herself take remedial actions for those who lost their jobs due to lockdown? I understand that US jobless swelled to 40 millions due to pandemic.

Topglove share price has gone up from rm 2.70 to the equivalent of rm 576 after numerous bonus issue and share splits in the last 20 years. This is equivalent to 30 % CAGR . Such achievement is better than Warren Buffet 60 years of investment performance. Many including myself regretted for not investing in.Topglove 20 years ago and keep long term until today. The question we should ask today is whether topglove can repeat such performance in the next 20 years . Based on the past 20 years record , the growth.rate of gloves was around 8 to 10 % when there was no pandemic or epidemic . With.small or medium epidemic like SARS, H1N1 and Zika or Merc., the growth rate increase to 15 % . The current covid 19 super pandemic has increased the growth rate to 20 % in 2020 and 25 % in 2021. The growth rate for 2022 is expected to hit 15 % and and thereafter between.12 to 15 % based on MARGMA data. Make your own judgement whether topglove will repeat its performance for the next 20 years. Do not regret the second time .

Topglove is not a company with size only although size does matter . Topglove is number 1 in all 3 glove categories namely Nitrile , Latexx and Vinyl gloves. Topglove has 1000 researchers in their 7 R& D centres. It has more than 100 PHD s. It is also the company with second most IP s filed in Malaysia last year.

Invest malaysia , of course harta can decide to expand its capacity on.latexx glove if it wish but why it wants to do that ? Harta specialised in Nitrile gloves and its expansion plan is 176 billion capacity per year in 2044 with its latest purchase of 250 acres of land in Kedah. This is much less than topglove expansion plan of 205 billions in.2024 . It looks like harta will not surpass Topglove in the next 30 years . By 2044, topglove could be a fortune 500 company with one trillion capacity at the current rate of expansion.