Well, Supermax added 3b additional capacity since last QR. (IIRC) It is very likely that they will beat last QR unless ASP is indeed falling already which would in turn see lower revenue and profit..

It would be interesting to see if they can finally reach 2.5b to confirm USD90 ASP that has been the talk for ages. I really doubt that every player managed USD90 ASP.

Are you serious? 1.8b? No way... LoL

Their capacity is just that much... How do you expect 1.8b? $160 ASP?

There's really simple way of calculating and predicting the outcome. Production capacity doesn't lie. It's open secret.

Half a cent also want to complain?

Glove at this price is still attractive especially the big 3 that kept giving good dividends. That big S, then you're out of luck.

Harta is special which cant be used to compare to the rest except YTY because they are more towards nitrile gloves which is selling way higher than rubber gloves. Moreover Harta is still completing ngc1.0 (plant7) currently which adds to additional capacity as we speak. Harta price is more palatable now that it has increased dividends to 16c.

Just use your calculator and you already know can buy or not.

If ASP start tanking now to below $50, slowly towards $30 around year end, then you can kiss glove goodbye already. It doesnt matter how much capacity you have because when it is all over, there will be tonnes of excess capacity. Just a note, pre covid utilisation rate of most glove makers is just around 60-70%.

Supermax is kinda easy to calculate what. 26b gloves annually... 48b by end of 2022.

Q2 supposedly 26b x $0.09 (USD90 per 1000) x RM4.1 x 1/4 (Q2 2021) = almost RM2.4b
But they reported 2b... ok...maybe like they said, kena close down due to covid not working, so lower output.

Next quarter ASP how much then? if average $80 (since they said January is highest at $90), then

26b x $0.08 x RM4.1 x 1/4 = RM2.13b revenue (wait n see)

If starting 2022 ASP drop to $30 for example

26b x $0.03 x RM4.1 x 1/4 = 800m revenue

Lets said Supermax is really fast and managed to install another 5b capacity in the next 6 months...

31b x $0.03 x RM4.1 x 1/4 = 953m

Profit margin berapa? Most indicator said glove price now = 4x pre covid. Precovid $22.5, profit are shitty. None of them are making a billion a year, let alone a billion a quarter.

You better factor in the excess capacity in your calculation.

Supermax want to double their capacity from 26b to 48b (not exactly double but close)
Hartalega want to double their capacity from 50b (I guess only since havent follow long time) to 95b.
Top Glove want to 1.5x their capacity from 96b to 146b.

3 players only already added 117b pieces...

If Rubberex, Comfort, Careplus, Riverstone, YTY added 3b each... another 15b

How much will AT, MahSing, Green Ocean, MSCM, Vizione, GPA will add to the market? if 3b each, another 18b.

Icemanfx added Intco (CHINA) want to build 100b pieces nitrile glove capacity....

I dont know about developing nation appetite for gloves, but if you can barely utilise what you have in hand pre covid, I wonder how will you utilise all these once covid is over. Heck, even if covid remain forever, all these additional capacity is being utilise, I doubt you can get such high ASP ever again.

To be fair, you can't compare face mask to glove. Glove expansion is much much harder and time consuming. You'll need to secure gas deal with Petronas, as well as workers to install the lines and run them.

Boon3,

Dont look too long... 2-3 years enough. We have done many orders before from 2009 onwards. After SARS, they said want to build how many bla bla bla.

Usually what they do is build 2-3 factories or so on new land, then slow down. Now I'm just guessing but I could be wrong. Why would they rush the initial phase? I'm guessing because they want connect the gas pipeline first. After that see how the demand fluctuate... Then only see whether want to fully expand or not.

I have always been critical of tech sector valuation since I dont view most of them as tech players. More as contract manufacturers, just like foxconn. Sometimes even LED makers also get labelled as tech which is perplexing.

Apa salahan laupan wanna cash out? After all, laupan work all his life for what? Now he can retire peacefully pun tak boleh? Besides I dont think laupan should stay forever. When the time comes, laupan better move aside for younger generation to go up. Need to learn from Hartalega.

Hartalega is the most overvalued amongst glove companies woh.

I no see people cry mom and dad over Hartalega PER4 or PER5. Still solid double digit PER. So what gives?

No full mco, what is the difference? Thinking too much la... now MCO is curfew to stop rakyat movement. Not to stop business. It will affect the economy somewhat still but export counters wont be too affected. REIT, retail, travel will take some hit for sure.

Personally I see that steel stockist are more likely to rally during steel price hike. Stocks such as Hiaptek, Leon Fuat, Ann Joo see huge spike since December. You can say that profits are so good now on your ex-stock but not sustainable since future purchase will also be more expensive. If they dont give out huge dividends, then all you can rely on is their uptick in share price. I'm also in steel and I hesitated to buy Leon Fuat too. For one, our business is getting kinda slow and Malaysia tends to rely more on government or GLC on projects. The next quarter could be even more crazy because their QR is only until December 20. Steel price IIRC was around 3.2~3.3k (bars and plate) before it goes up to 3.5k (bars and plate) in March 21, and later 3.8k (bars and plate) in April. It saw another huge uptick this month due to China removing subsidies and steel price now hovering around 4.4k (bars and plate).

If you are lucky to have leftover stocks, then you are bound to have a windfall if you got what customers is looking for. Yes, business is down but the fat margin make up for it.

This post has been edited by andrekua2: May 11 2021, 09:49 AM

LOL Bursa... majunya Malaysia

10tick? Forced selling is it?

Long time no see Bone gor... Remember last time when I was quite active trading, always see him here.

This post has been edited by andrekua2: May 12 2021, 05:59 PM

Scam? What happened? Writing stock recommendations?

Ohh...

I did buy few of the stocks he recommended. Only that I bought it before he recommended them.