Supermax: The Best Is Yet To Come- Myth or Truth
It will all be reveal by Stanley Thai, who once said that he expected Supermax revenue to hit RM700 million in 2005 on a Bursa Query on 18 October 2005.
Back then, the company is running on a capacity 8 billion per annum.
Can his words be trusted even since he was previously convicted of insider trading with former remisier Tiong Kiong Choon who had each been sentenced to five years' jail and fined for insider trading in relation to APL Industries Bhd (APLI)?
Away with the past, now the company is running towards 100% capacity of 26 billion per annum by end 2020. It also runs a different model of OBM structure that allows it to garner better ASP and profit margin. Also noting among the top 5 largest glove manufacturer in the world, it’s the SMALLEST. However, it’s plan to expand it’s capacity to 48 billion per annum by 2022 is the BIGGEST among the top 5.
Note: Supermax exported 55 per cent of production under its own and 40 per cent through independent distributors. Only five per cent is allocated for original equipment manufacturer (OEM) production. Supermax is able to leverage on its own distribution to build a direct relationship with the end users so that they will remain sticky and continue to purchase through Supermax's own distribution channel even post-pandemic.
Currently Supermax will be announcing it’s Quarter 1 (Q1) results soon.
In i3 investor forum, people are calling its Q1 PAT between RM600 million to RM1billion.
So it’s safe to say that RM700 million to RM800 million is possible.
However, let’s be reminded again that Supermax’s last call for ASP hike was back in July (Refer to slides)
Will there be further ASP hikes for August onwards?
What’s your take on Supermax’ Q1 PAT?
Related stocks: Topglov, Harta, Kossan, Careplus, Comfort, Ruberex, Mahsing
https://klse.i3investor.com/blogs/20200913StoryRM200Bil/2020-10-27-story-h1535482816-Supermax_The_Best_Is_Yet_To_Come_Myth_or_Truth.jsp
