Lai lai, be my guest..I always welcome constructive criticism, it can help me sharpen my rational thinking skills and see things from a perspective I can’t due to confirmation bias..

I’ve thought through all the above concerns you have, fortunately I’m able to address your concerns in simple words, as I’ve watched the zoom meeting given by the Alvin Ang back in Oct 2020.

1.) according to Alvin ang, world plastic demand is growing about 5% annually, slowly but steadily.

2.) TGuan has bought in additional resins when the price was low last year, so it won’t affect their QR in coming 2 quarters if I remember correctly...their nanotech in the premium stretch firm sectors allows them to command higher profit margin (the new factory started operation since late Oct-Nov last year, with additional 11 production lines, each line can pull in 100-500 mil annually, Alvin calls it the “next billion of their revenue”.

3.) they saw this coming, so their PPE are transacted in USD for hedging purpose.

4.) internationally speaking, they have started expanding their stretch firm production to Myanmar..domestically, more factories are built to increase production lines, and with the increasing courier bag demand, they have allocated new factories to accommodate..

If you have time you can search on fb the video below under cgs-cimb page, I sourced my explanation from the meeting

Maybe it takes a thief to know a thief.

Wonderful info.
Might have some homework to do tonight to see if I want to get involved tomorrow.

Plastic is the new rubber

So yeah tguan / scientex no brainer. Just buy and sit on it, wait for packaging boom. It will come, especially now most big brands will switch from corrugated box to eco friendly plastic packaging due to its flexibility and weight.

Also also don't forget the amount of ecommerce transacted currently, do you notice all your goods from online come with some form of plastic packaging such as shrink wrap or some bubble wrap ?

MedElite23ChAOoz

Do you have a view on why Tguan has been downtrending until recently?
Looked at the QR and no red flags.

That’s precisely my thoughts of consideration before decided to invest in the plastic packaging company.

It doesn’t have an attractive story to sell for like in the tech sector, but it’s an essential industry that sells no matter the economy is up or down, relatively speaking. With increasing delivery and take away service, the plastic packaging industry will gain huge benefit from it, and I don’t see them going away anytime in the near future..

No particular bearish news bro, this industry has been under the radar haha..

If I were to nitpick, it’s probably due to the concerns squarepilot had in mind.. they needed to dig deeper..second level thinking is much needed being an investor,imo..

Shipment cost increase, USD weakness, Resin price increased.

All this is temporary, but packaging trend growth should be consistent for next 5 year.

Thank you both for your kind replies.

My circle of competency right now extends only into the corrugated cardboard packaging industry, with a slight edge into plastics which I do not know enough of the industry.
I have Scientex, but the knowledge does not extend beyond the company. I can see a tonne of plastic industry papers for reading waiting for me. Strangely enough, I used to be tracking SLP but chose not to go in because of future prospects.

The current price point for Tguan looks fair. If the boxes get ticked tonight, might have small entry position tomorrow.

Good stuff bro, do share with us here tomorrow if you’ve initiated a position and your rationale behind the decision. All the best!

Okay here's my contribution. (the least I can do)

My bad. There was another report on the plastic packaging industry.

Here ....



here is TGuan...

that's a ascending triangle right there.... (pls google if you are unsure what ting tong I am yapping about)



and of course there's Tomy






okay?



This post has been edited by Boon3: Jan 19 2021, 08:11 PM

Wah...thanks bro

I need to improve my trend line drawing skill.. the one I drew looks like a symmetrical triangle more than an ascending.. but I trust you more hahahaha

Yay, fills it from the TA perspective.
The least I can do for contribution is a small write-up on the decisioning process after I finish my reading tonight. I'll take an IOU for now.


Sure sis. I'll put one up later tonight or tomorrow latest.



This post has been edited by statikinetic: Jan 19 2021, 08:21 PM

Boon3 You wanna join the packaging band wagon or not ?

Your drawing is okay la..

just remember.. in situations like this... the bottom line, showing that the recent lows are getting higher...

..... lol.... need a break and take it easy.

Here is my end of the bargain. I've finished my prelimenary research which covers the past couple of annual reports, financial statements for trailing 8 years, news portals and that 1 hour vid from CGS CIMB with Alvin which was more interesting than I had expected. Here is my basic checklist.

Fundamentals
Year on year revenue increase is clear. Balance sheet is solid, though not flawless.
I like that the Cash From Op is rising to layer the bottom line. Though the free cash flow is considered high right now, I have concerns on the historical dips. Business expansion would likely be the cause here so I'll give it a pass. Higher profit margins we see are good, but keep in mind some part of it seems driven from lower material costs so I don't think it is sustainable.
Balance sheet wise, the debt to equity ratio is acceptable. Debt is 95% covered by the operating cash flow which is good.
The company also earns more interest than it pays so interest coverage gets a pass.
Overall debt has been growing which I dislike. Considering the expansion, I will pass this for now but I really hope it goes down post.

Growth Potential
I think for the industry, the word should be slow and steady growth.
The company has demonstrated good growth in the past and there are plans to continue with the strategic expansion plan which is already in execution phase. I like this as compared to one still residing on a powerpoint deck. One question mark I have are how new sales are being sourced.

Management
I gauge this by measuring how management has run the business on a day to day basis as well as strategic plans.
Overall goal to double revenue from a couple of years back is still on track. The expansion for the local facility and Myanmar gives them space to grow and scale. This expansion is somewhat delayed because of the MCO and I think they are still struggling to fly specialists in to work on it. Definitely a pass here for overall management. From the plan and past results, looks to be a group of people I'd give money to.

Alternatives
Tguan has a higher annual growth rate to some of it's peers like SLP and BPLAS.
BPLAS looks undervalued too with good fundamentals but probably suffers from the small market cap. Even with a good QR, the share price barely budged. They are sitting on lots of cash though. Anyhow, when in doubt for capital appreciation, go for the bigger players.

Industry Concerns
If this industry experiences a boom, ESG considerations might start to weigh in. Especially the 'E' part. Plastic gets a bad red. For now, not an area of concern.


I think the price is about fair and usually I would buy in with a small entry position to start with as part of an entry strategy.
However, there is an additional listing of 185k shares as an ESOS exercise announced today. I think the price might trace south tomorrow in response.

I'm onboard, most likely to pull the trigger sometime tomorrow.

Wonderful analysis, may the market be with you

Thanks. I think that's 2 companies now that we have in common with exposure to the Tokyo Olympics.