Hahaha GL quite new in this market. supermax is OBM model of course the profit margin higher than kossan and the rest..if asp drop will impact to all gloves not only supermax. what theory if supermax drop and kossan up whilst kossan is not obm...hahaha

I am right in the long run. In short run, the market is irrational. Supermax is clearly not worth the current price. It has poor track record in executing the OBM model and was the last in the glove race since 2010. The OBM model only work well during a pandemic. But this model has reached its limits as seen in December's results which was not much stronger than September's. OBM or not, Supermax ASP like Topglove has stretch to a peaking point, meanwhile, less room for ASP spike

Kossan ASP still much lower, so it will see qoq profit growth all the way to Q3 or even Q4. In Q3, Supermax's profit will fall. Its OBM model is pathetic. Look at the other 3, OEM but much better for the past 10 years than Lousymax.

Agree that Kossan n Harta raising ASP slower than Topglove n Super and Kossan also doesn’t practice the policy of using max price to sell; in other words , unexpected high profit of Kossan in latest quarter may not mean Super can get something like 30-40% higher than last quarter profit...

GL, I did argue the point that OBM model is nothing special n only working well during pandemic but 60-70% of the ppl here don’t understand this point ; then analysis further , how powerful is Supermax brand in the US n Canada market .... Shortage of gloves the main reason that super can sell her gloves with much higher prices to the hospitals n end users ...

I concur. The market is a weighing machine in the long term. Currently, most day traders are voting for Supermax. But soon prices will correct and reflect the reality. I also believe OBM does not give a significant advantage. If it did, Hartalega and Topglove will use their own brands too. But they don't. Some also praise Supermax's own distribution model that let it sell higher. But history showed that Supermax is not very good at distributing its own gloves

Better sell to established distributors like the other glove companies. But Supermax still want to gamble more on ODM by opening large US distribution centre. Imagine how much overhead cost it needs to maintain this just to get a marginal advantage over other glove makers in the US market.

Before jan of 2020, Supermax top management n sales volume is quite far behind of Kossan n those analysts don’t really analysis Super ... Agree that if OBM model so wonderful , Harta n Topglove would practice this model or mix of 2 models... Brand power ? The western countries are ancestors of branding n Japan n Korea still learning how to operate international brands ...

Remember that Supermax is RM 4 billion more expensive than Kossan. We have to ask how Supermax can earn RM 4 billion more than Kossan. On top of that, Supermax is lousier than Kossan, that is why its pre-pandemic PE is lower, now Supermax PE is higher instead. Kelvin and I are speaking based on facts. Sentiment wise Supermax seems to be better, but TA always lags FA

Retail investors, 60-70% of them r new investors ( less than 3-4 years) n these 12 months trend are the newbies only emphasis in technical analysis n short term goreng ( 3-4 weeks or 2 months )... they don’t bother to learn more about fundamental analysis ... it is normal that don’t understand many points about a company ...

1.3 bil still doesn't justify why Supermax is more expensive than Kossan by RM 4 billion. Don't forget to factor in Kossan's better track record than Supermax. Supermax is going to build a US plant and distribution centre, which we all know is operationally inefficient.

I also forecast Supermax only posted 1.1-1.35 billion quarterly profit ( we don’t know her ASP still up 10% or more )... Supermax quarterly profit of 1.2-1.3 b already 40 times of pre pandemic quarterly profit ( about 27-30 mil).... Kossan n Supermax may have same market cap after June or July ..:)

Besides low dividend policy, the returns from US plant will be poor because it is not cost effective at all. Which means the discounted future value of the RM 2 billion is far lower than the present value.

Supermax has a ROA of 8%. So we will expect Supermax to generate an annual rate of return on that RM 2 billion of 8%. But its US venture suggest it will make far less, possibly only 4%. So for a 10 years horizon, the net present value of the project is negative RM 630 million.

we got to see where they park the expenses, most likely won't be in cost of sales. I believe will be in amortisation in current liability. their accountant will know well. last fa their company collected prepayment of 1.4 bil under current assets.

Meaning, Supermax will make a loss of RM 630 million by opening the US plant. If we stretch the time horizon longer by another decade, the losses will increase further unless it shuts the US plant. Supermax cannot run its glove operation as efficiently as its counterparts, that is why it should trade at a discount

The fact is, in the next 10 years, Supermax will lose an upwards of RM 630 million or more by opening a US plant which is operationally inefficient. I based this figure on a rate of return of 4% vs its current ROA of 8%. It is destroying value.

The management is just a US bootlicker, they have been obsessed with the US market since last decade and failed miserably. Not going to support a management that cannot stop its obsession. Look at Stanley, he bought a condo in US. I think their intentions are clear, they are just obsessed with making a mark in the US market. Amdk

lol..bursa market no one can project 10 years, even analysts will project 2 - 3 years...the plan is not a loss.but rather I see i an expansion to the business. the cost can be amortisation to 5 years. if versus the collection of the revenue, can far better manage it.

Can conclude that @GL prefer "safer" counter and doesn't like uncertainty/challenges? I also agree the management should invest the money into expansion for more potential profit whenever there is opportunity (focus on the business but not the share price).

Building a big factory / plant , in accounting method , it is capital expenditure; dont straightaway as cost of sales or expenses, dont affect the quarterly profit directly ... If not mistaken , the plant / asset will be deducted by 10-15% yearly as depreciation / capital allowance ...

GL, many don’t understand discounted cash flow n future value of plant after 10 years; in other words, the plant in US will have much higher cost than those glove plants in Malaysia or Thailand , much higher operating cost , maybe per glove cost is double of Malaysia n Thailand plants ; if much higher cost mean operating margin of Super will drop in near future .... So, those said big boss don’t understand the Pro n bad of build a big plant in US?? If US impose import tax of 25- 30% on imported gloves , then maybe no a bad idea but US side hasn’t impose any significant import tax for gloves from Malaysia n Thailand so far..

Kossan advantage is doesn’t expand production as fierce as Topglove n Super in this pandemic period ; Topglove has practiced share buy back most aggressive then super , share buy back cannot add value to those big manufacturers , just lifting share prices ( like what the big cap US companies doing )... If Kossan able to post 1 billion per quarter, it is much cheaper than Super n Top n Harta ... :)

Actually I think Kossan even before the pandemic got major expansion plans. The Bidor plant, around 30 billion capacity. After all, glove demand is always on an uptrend, even more so with US universal Healthcare. I think the big 4 is fine as long as they can keep competitors out.

I just cannot brain why Supermax is so high. They already make known they don't plan to change their operations but instead double down on the mediocre ODM/OBM business model + US plant. Maybe to Stanley profit not as important as breathing American air and shitting in American soil. Maybe he wants to migrate there lol

I and GL think the US500 investment to build a big plant in US, higher chance to be a failure investment ( for this ，analysts in research houses also some support n some disagree ); besides much higher operating cost, there r a lot of rules n regulations in US n EU due to they are advanced counties ..

erm i dunno about glove business

i only care my portfolio

for me which one better profit i go which one tats all wat US plant la / cost efficiency la

macam u all work in glove and live in US wat a funny
statement..... last time said glove is only for small retailers

now said kossan wat wat, supermax wat wat mcm in tat industry long long time haha

The funny statement is those who keep said glove will continue drop one now come and become superb analyst

Don’t be too much conspiracy theory, we r not China versus US... GL n me understand value investing , many here even reading 2-3 books of 冷眼still don’t understand value investment... Super up coz many think it can continue to post more than 1.1 bil profit for next 2-3 quarters n most retail investors like Super, Top n comfort n careplus than boring Harta n Kossan ... Our opinions since 1 months plus ago don’t have any intention for u guys to switch to Kossan... Retail investors prefer to speculate or invest at counters which have gone up faster/ a lot since last year...

Since u want to challenge u should said first if no go up to 70 cents in 4-5 months than how? If u really so good in value investing not suppose to stuck and need wait 4-5 months to just break even.Hahaha

Ocncash QR compare glove is almost consider no growth only TA show very weak signal and kevin u go in to said it will reach rm0.70 in near term hallo it is 30% from it current price ler...... if ocncash can reach rm0.70 supermax already rm8 lo, ocncash got wat fundamental dont tell me u go in not for goreng la.... bla bla bla 大户kevin

Glove after covid still using especially during vaccinate..... mask now i selling at rm4.50 dy compare to it height rm100 during march 2020

Glove i now wanna sell cheapest is rm20++ compare to it low rm11

u go to invest mask company and keep saying glove company is goreng stock haha.... wat a funny statement

Aiya, I said oceancash is undervalued n can go up to 70-75 cents in few months time , is my view ; dont think anyone can just read 1 hour of financial ratio , go to i3investor to read what type of biz then can understand the counter more than 50%.... That guy really small minded , my cost was 68 cents 30 days ago , do I say my cost still 68 cents after 30 days. Good thought still tell the strangers less then feel more comfortable...:)

Warren known too little about ocean but want to show knowledge; oceancash is largest non woven fabric manufacturer in Malaysia n top 3 in south east Asia but she doesn’t produce masks n only supply small quantity of non woven fabric to mask manufacturers... only can tell half to clarify half...:)

i agree with jyh. my hq provides ffp2 mask from zhejiang province supplier. medical mask from henan province. during my qatar flight to kl recently from frankfurt, qatar airline uses mask glove hand sanitizer kit from guangdong province. yingke yi liao glove counter also kena goreng up trend recently. jiayou msia top 4 glove counters :)

sometimes business decision can b of other agenda. not just cost. because western countries will impose import rules. i guess that decision has to do with creatinf job opportunities there and grab msrket share in that region. my source told me certain manufacturing will move back to western country. how much % i dono. to rely less on asia...also to provide competition a little bit...good weekend everyone :)

thats why even good prospect as described by kevin but ocean can't perform well in last few quarters due to the product is not unique and it caused the shares can't move up. ppl would rather buy prlexus due to their mask is specially made to few brands worldwide. the stocks selection from kevin still not so good.