Showing posts with label Covid19. Show all posts
Showing posts with label Covid19. Show all posts

Thursday, August 20, 2020

Pharma already price in for current quarter result and prepared for future earning

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As I had been invested in Pharmaniaga, the result that is release on Wednesday evening could had gotten some mixed feeling over revenue and profits.


While there are some investor which are expecting a very good revenue and profit, however, it turn out that the profit is still going good, but not explosively tremendous until it will see the stock limit up. According to analyst, the result is within expectation.

Pharma revenue did improve by 44 million, and earning increase. There is some slight drag down on Indonesia operation due to payment from Indonesia government could be slightly hard during this trying time. Other than that, it is good.

https://www.thestar.com.my/business/business-news/2020/08/19/pharmaniaga-2q-net-profit-higher-at-nearly-10mil


The result could be factored into the price from a peak of RM 5


As you can see, the current price of RM 4.40 is more than 10% adjusted from the peak of RM 5.00, which is reflective of the current quarter result, but anticipating on the future revenue from the vaccine bottling and distribution effect.

If we are to compare on the virus outbreak and movement of share price, the Coronavirus got detect in the middle of December 2019 in WUHAN, CHINA. It got into momentum earlier this year, and global lock down on March 2020. However, most of the gloves share price are still not moving drastically upwards. It took almost 4 months for gloves company to consolidate, and journey to >1000% capital appreciation.


Hence, this will be the same for Pharma. The revenue and profit is there, but there will be waiting, but any good news on Vaccine development will spike the interest of investor in Pharma.


Currently, there are 2 vaccines under approved for limited use. One is from RUSSIA, and another from CHINA by Cansino Biologics. 

https://www.thestar.com.my/aseanplus/aseanplus-news/2020/08/18/china-grants-country039s-first-covid-19-vaccine-patent-to-cansino


It is prime time now for Malaysian counterparts to get ready for Vaccine sourcing in order not to get stuck in the bottleneck of orders.


Further news from Minister of Science Technology and Innovation, Khairy Jamaluddin is recommending that the vaccine to be provided free to ALL MALAYSIAN. If this will come through, Pharma / Dpharma could be almost certain in getting a confirmed sales of approx 80 million doses (if 2 doses required per person)

https://www.channelnewsasia.com/news/asia/covid-19-coronavirus-malaysia-vaccine-free-for-all-13034404


Any drop in Pharma share price will be a good opportunity to scoop in due to the confirmed revenue and sales from the government.


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Monday, August 10, 2020

PHARMA technical chart consolidation points towards imminent break out at RM 5

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As you know, I am staunch supporter of Pharmaniaga (PHARMA - 7081). As vaccine is a sure thing to happen, Pharma is a sure thing to profit from this vaccine bottling and distribution. It is only a matter of time.


We witness how powerful glove company can rally. I believe Pharma also can be this powerful when the vaccine solution arrived.

Today closing RM 4.75 give PHARMA a total market cap of RM 1.24 billion, which I still consider it very cheap.


Even DPHARMA got a higher market cap compared to Pharma although Pharma earning is better. DPHARMA market cap is RM 2.16 billion.


So if PHARMA need to go to RM 2 billion market cap, the share price need to be RM 7.66 to reflect this


I believe PHARMA will continue to see strong uptrend this month especially when QR is coming out.

Based on the latest chart that Pharma is going on, it is matter of time RM 5 will be break out. Consolidation is pointing on breakout happening this couple of days. RM 5 already been test 3 times, I believe 4th time will see a strong break out and many retailer will start chasing it.


Since Pharma is destined for vaccine bottling and distribution to government hospital in Malaysia, and probably Indonesia, it will be good to invest into Pharma to capture the growth. Anything below RM 5 will be a good entry point as break out above RM 5 is very soon technically.


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Sunday, August 9, 2020

GLOVE MAKER RAMPAGE EXPANSION WILL BOOST KSSC SHARE PRICE HIGHER

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Glove maker all over the world are having a big problem now, which is to deliver all the pending order as soon as possible. However, due to demand exceeding supply, the ordering waiting list can be as long as 18 months. This can continue to put pressure on pricing escalation, but it will also be a sweet tooth for glove player to expand in a more generous manner.

According to the news featuring the TOP 4 glove companies in the world, all of them had wasted no time to purchase land and start the expansion plan.

SUPERMAX - Buy Klang land to expand production

KOSSAN - Buy factory from CBIP for RM 40 million

And KOSSAN also sell land at Kuala Langat for RM 153 million to fund glove expansion at Bidor, Perak

Hartalega - Buy 95.1 acre land at Kuala Langat for RM 263.1 million


TopGlove - 21% growth and expansion plan

TopGlove allocate RM 600million for expansion plan in 2020


All glove company are in crazy expansion mode now, they are buying land at high speed, and factory need to be set up within 1 year. All this point to very positive growth to GLOVE SUPPLIER.

HLT had took the prime bite on the growth, it is time for KSSC (via KSG ENGINEERING SDN BHD) to catch up on all the missing bites)

Now at 79 cents, KSSC is just a meager RM 75 million market cap.

If KSSC can go
RM 1 - KSSC is worth RM 96 million
RM 2 - KSSC is worth RM 192 million
RM 3 - KSSC is worth RM 288 million
RM 4 - KSSC is worth RM 384 million



Based on a simple voting result, 35% are optimistic on KSSC heading towards RM 2.65

However, do not that this polling result is not and should not be treated as a reference or guide to buy or sell.


All this are purely for your informational purposes that are happening on the glove industry.



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Thursday, August 6, 2020

KSSC is the hidden gem in Malaysia glove dipping line provider, will be shooting to sky for next few days!!

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Today got very very good and interesting company that will maybe see limit up a few round due to many investor overlook on this company potential despite being directly related to GLOVE INDUSTRY, and support big company like TOPGLOVE and KOSSAN..

This unknown company is hidden as a steel pipe manufacturer, but actually got a 100% owned company doing set up for glove dipping line.

Remember to allocate some bullet for KSSC - 5192, because this stock is super undervalue.

There is one subsidiary under KSSC (100% wholly owned) named KSG ENGINEERING SDN BHD

KSG ENGINEERING WEBSITE
There are end to end consultant and fabricator and contractor to build glove dipping line for large company such as TopGlove.

They also provide spare parts

KSG ENGINEERING MAIN CUSTOMER


As you can see, KSG ENGINEERING is supporting TOPGLOVE, KOSSAN (2 of the TOP4 glove manufacturer in the world)


The closest competitor with listed glove dipping line provider is HLT, which have market cap 1.66 billion.


If based on current valuation, KSSC should be worth RM 20 already. But since this is a little bit over the board, what about RM 4? Just grow 10 times the market cap?

So have to get ready KSSC to be limit up a few round in a row!!! We know that a lot of gloves company are buying lands and setting up new factory in a big big aggressive manner to cater for the demand. KSSC will aggressively benefit from this.

Short term TP RM 1.50


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Wednesday, August 5, 2020

PHARMA Q2 RESULT PREDICTION WILL BE VERY GOOD AND POSITIVE EVEN WITHOUT VACCINE

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Pharma will be reporting coming 2nd Quarter QR and insider projection is expecting it to burst into some very good figure. Expected date for PHARMA Q2 result is 18/19 AUGUST 2020.

Since Pharma contract to supply to Malaysian government is extended to the end of December 2021, we expect that the COVID-19 preparation and the medical supplies stock up as well as enhance usage of gloves, face shield, face mask and hand sanitizer will increase drastically.

Don't forget PHARMA also have INDONESIA operation, so the effect will be much more stronger!!! MORE SALES, MORE REVENUE, MORE PROFIT!!

So in short, without the VACCINE coming in, PHARMA will still be reporting very excellent result for Q2 and that is for sure..

There are still a lot of other product, needles and syringes, medical machines and stuffs.

Even though PHARMA today had went up 12%, actually it is still very cheap.

At RM 4.78, PHARMA market cap only RM 1.25billion. Reason is because only 261m shares, so the chances to go up in a parabolic manner is very high..


Look at the awesome chart, at the current environment and feel, easily Pharma will be heading 3 to 4 days to big green candle, parabolic upwards, break above RM 5.00, challenging RM 6



Then when vaccine news come stronger, another leg up..

So better prepare your heart to invest PHARMA and hold until RM 10, then aim for RM 15 to RM 20 for BONUS ISSUE...

Gonna be a long investment journey with PHARMA.

I AM INVESTING PHARMA UNTIL RM 10 ALSO NOT GOING TO SELL... TIME WILL TELL.


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Monday, August 3, 2020

Coronavirus (covid-19) created a vaccine business worth USD936 billion yearly!!! What you need to do to capitalize on this?

The COVID-19 has indeed created a lot of fear, cracked up a lot of economy, creating hyper inflation from government stimulus, but it also add into a potential business worth USD 936 billion annually!!!

Yes, you read it right, it will not be a one off event, but rather a annually / seasonal vaccine that will require human to spike up immunity defense against the virus.


According to BioNTech, PFIZER, SHANGHAI FOSUN partnership, this coronavirus vaccine shot will be needed seasonally. The virus is expected to be here to stay, hence annual vaccination is required to spike up human immunization against the virus.

Based on the global population of 7.8 billion people, each dose costing USD 60, and with 2 dose vaccination, this is equivalent to USD 936 billion annually!!!!

Pharmaceutical companies are going to make the heist, and that is for sure! 

What can you do as a Malaysian investor in order to capitalize on this opportunity?


Luckily for our minister, the Malaysian counterpart had put in intention that the vaccine will not be imported as a fully finished product, but to be import as a partly finished, with the end bottling process to be finished in Malaysia pharmaceutical companies which are capable of handling it.

If you do not understand, this is like buying a CKD version of BMW or MERCEDES instead of buying a CBU version. This will create job opportunity for Malaysian, which is beneficial for the nation.

Currently, 2 most suitable pharmaceutical for this bottling process is Dpharma and Pharma.

While both are good, I will prefer Pharma due to
1. Government supply contract to government hospital
2. Established supply chain, logistic and network
3. Lower share outstanding compared to Dpharma, hence capital gain are higher due to less dilution of profit



Global pharmaceutical company are going fast and rushing into the vaccine.

Time line expected to see it at Q4, October 2020..



Just like Glove.. Since the detection of coronavirus, Glove are muted for 4 months from December until April... After that, all hell break lose..

Pharma will be the same.. Now it is muted at this level around RM 4.00..

But when the vaccine comes, it will not be RM 4.00, and you will have to risk chasing higher and higher and roller coaster...


Invest now or chase later? That is your decision to make.

Wednesday, July 29, 2020

Can Pharma be worth RM 20 next year?

We had seen with our eyes how a pandemic create chances that are unthinkable in normal circumstances. The primary beneficiaries for this is gloves industry and their related companies.

By now, a lot of gloves companies already saw share price appreciated much, some with still room to go, some maybe priced in. But we do not know what will continue on, however, the near term can be seen as this pandemic will continue to be here for a little more while as the world enter into the 2nd wave.

Gloves companies such as Topglove, Supermax, Hartalega, Kossan, Careplus, Comfort, Rubberex, HLT had saw share price went up by many fold.
Other related industry are Hexza, Luxchem, Samchem, LKL, Ocncash also saw share price booming up.

Pharmaceutical company are catching up. Among them are PHARMA, DPHARMA, KOTRA, YSPSAH, AHEALTH.

Today focus is - PHARMA GETTING TO RM 20, PRACTICAL? REASONABLE ? DOABLE ?

We calculate here 1 by 1

Total share is 261.7 million, if RM 20 per share, means total market capitalization is just RM 5.23 billion. Only 5.23 Billion.

So can the coming future of Pharma earning able to justify PHARMA worth RM 5.23 billion, or RM 20 per share ?



1st, the usual normal operation is profit making, around 9 cents per quarter.
Hence, the valuation for this company at PE x 15 = RM 5.40

Secondly, Pharma is a good candidate for bottling of covid-19 vaccine with facilities ready.

Malaysia put it as 40 million people (citizen + foreigner combine)

Vaccine if selling RM 150 per dose and each person needing 2 dose.

40 million x RM 150 x 2 = RM 12 billion business opportunity annually


But Pharma got some established Indonesia operation, and can get exposure to more than 300 million people.



Got coverage in all the main indonesia island



And MPI is listing and 75% owned by PHARMA, hence can capture the large growth rate



Indonesia listed Millennium PI also can see share price increasing



So if PHARMA also can capture 15% of the 300 million people from INDONESIA market

45million people x RM 150 x 2 = RM 13.5 billion market business opportunity


So if PHARMA potential future business opportunity increased by 25.5 billion annually, profit margin 10%, and lets say only take 40% from the pie

So potential earning is RM 1 billion a year !!!!!!!

EPS will become RM 3.90 a year potentially !!! 

If value PE x 20 will become RM 78 !!!!!


RM 78 hard to believe right? So we take 30% from it, reasonable ? That is RM 23.40

So future can PHARMA share price go to RM 20 ? Now RM 4 better act fast

Tuesday, July 28, 2020

Why you should buy Pharma now

With the covid-19 pandemic spreading all over the world, glove industry had been making a big windfall from maxed out orders and higher average selling price due to orders from all over the world.

As the whole world is 7 to 8 months into the virus, the chase for vaccine development had been speeding up globally. R&D had been pouring out in US, Europe and China in search for the suitable vaccine candidate for this coronavirus.

How should this relate to Pharmaniaga (Pharma - 7081)

As you may see, our Malaysian minister had shortlisted 2 candidate to be the vaccine bottling process - Dpharma and Pharma. Subsequent on this new, the share price of this 2 companies had rocketed much, but is this fully valued?



Pharma still have a lot of potential to rise based on the company prospect and shareholding.

Pharma only have 261.7 million shares outstanding, at the current price range of RM 4, the market capitalization of Pharma is only RM 1.04 billion.


As you can see, BOUSTEAD already hold 56%.
LTAT holding 11.5%

Hence, majority of the shares (70% of the shares) are already being held by strategic investor that are not going to sell out, leaving the market with just 30% of the shares.

This means, just 78 million of shares are left floating in the market for the public. 
This is not discounting investment fund, unit trust fund investing into it and holding for longer term tenure, hence probably the market is only left with 30 million share for the retailer only.


A lot of you might be concerned on Pharma FYE 2019 loss of 57 cents per share. This is due to impairment of a system development, which is not going to be recurring, but a ONE OFF EVENT impairment.

Subsequent proof of result is PHARMA delivering 8.57 cent in earning per share with a 6 cent dividend.


Hence, based on this average result, ANNUAL EPS PROJETION is 36 cents
At PE x 15, PHARMA should be valued RM 5.40 based on existing performance.


So PHARMA is still a good buy, because it had not yet factor in VACCINE reselling and also potential in INDONESIA operation for vaccine reseller.

Keep you updated in next post.