Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

Sri Trang Gloves (Thailand) / Equity Bottom-Up

<ul>
<li>Riding on COVID-driven demand boom, <a href="https://www.smartkarma.com/entities/sri-trang-gloves-thailand-public-company-limited" target="_blank" data-smartkarma-citation="entities:29141:1" rel="noopener">Sri Trang Gloves (Thailand) Public Company Limited (STGT TB)</a> reported record high performance in 2021, which is not likely to continue in near-term.</li>
<li>However, post pandemic, gloves demand is expected to improve on the back of increased glove usage from emerging markets with low gloves consumption per capita and heightened hygiene awareness.</li>
<li>STGT shares have corrected 15% thus far in this year, providing a good buy on dip opportunity. Shares can be considered for the long-haul.</li>
</ul>


Riding on COVID-driven demand boom, Sri Trang Gloves (Thailand) Public Company Limited (STGT TB) reported record high performance in 2021, which is not likely to continue in near-term.
However, post pandemic, gloves demand is expected to improve on the back of increased glove usage from emerging markets with low gloves consumption per capita and heightened hygiene awareness.
STGT shares have corrected 15% thus far in this year, providing a good buy on dip opportunity. Shares can be considered for the long-haul.


Sri Trang Gloves (Thailand) Public Company Limited (STGT TB): Short-Term Pain; Long-Term Gain

External broker reports(aggregated public sources), TA Securities Holdings Berhad

TA Securities Holdings Bhd

External broker reports(aggregated public sources)

Kossan Rubber Industries / Equity Bottom-Up

<p>Solid 9MFY21 Results Last Traded: RM2.44 [...] Kossan reported 9MFY21 net profit of RM2.6bn (+383.8%), which came in at 85.2% and 83.8% of our and consensus full-year estimates, respectively. We deem the results to be within expectations as we expect 4Q21 results to be weaker underpinned by lower ASP. [...] The increase in ASP has boosted the PBT margin to 60.6% as compared to 29.0% in 9MFY20. [...] Required Rate of Return of 7% is defined as the yield for one-year Malaysian government treasury plus assumed equity risk premium.</p><div class="content-highlight"><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></div>

Solid 9MFY21 Results Last Traded: RM2.44 [...] Kossan reported 9MFY21 net profit of RM2.6bn (+383.8%), which came in at 85.2% and 83.8% of our and consensus full-year estimates, respectively. We deem the results to be within expectations as we expect 4Q21 results to be weaker underpinned by lower ASP. [...] The increase in ASP has boosted the PBT margin to 60.6% as compared to 29.0% in 9MFY20. [...] Required Rate of Return of 7% is defined as the yield for one-year Malaysian government treasury plus assumed equity risk premium.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

<div class="content-highlight"><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></div>

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

Intco Medical Technology  Lt / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/intco-medical-technology-co-ltd-a" target="_blank" data-smartkarma-citation="entities:29782:1" rel="noopener">Intco Medical Technology Co., Ltd-A (300677 CH)</a> is the largest disposable gloves provider in China and the third-largest in the world as measured by production capacity as of 31 December 2020, according to Frost &amp; Sullivan. Intco which listed its A Share on the Shenzhen Stock Exchange on 21 July 2017, is seeking an H Share listing to raise $1 billion, according to press reports. </p><div class="content-highlight"><p>Intco along with its global peers have benefited tremendously from the demand-supply imbalance for gloves due to the COVID-19 pandemic. Most peer share prices have declined since the start of the year in expectation of peak quarterly earnings in the second or third quarter of 2021. The glove industry has gone through two previous cycles but has re-rated at each cycle – sector average P/E of 11x in 2007-11 and P/E of 18x in 2013-17. As the industry continues to be underpinned by structural growth drivers, the sector will likely re-rate as sector earnings normalise. Overall, we think that Intco has attractive fundamentals to benefit from these market dynamics. </p></div>

Intco Medical Technology Co., Ltd-A (300677 CH) is the largest disposable gloves provider in China and the third-largest in the world as measured by production capacity as of 31 December 2020, according to Frost &amp; Sullivan. Intco which listed its A Share on the Shenzhen Stock Exchange on 21 July 2017, is seeking an H Share listing to raise $1 billion, according to press reports. Intco along with its global peers have benefited tremendously from the demand-supply imbalance for gloves due to the COVID-19 pandemic. Most peer share prices have declined since the start of the year in expectation of peak quarterly earnings in the second or third quarter of 2021. The glove industry has gone through two previous cycles but has re-rated at each cycle – sector average P/E of 11x in 2007-11 and P/E of 18x in 2013-17. As the industry continues to be underpinned by structural growth drivers, the sector will likely re-rate as sector earnings normalise. Overall, we think that Intco has attractive fundamentals to benefit from these market dynamics. 

Intco Medical IPO Initiation: Riding the Cycle

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

<p>The <a href="https://www.smartkarma.com/entities/kuala-lumpur-composite-index" target="_blank" data-smartkarma-citation="entities:22913:1" rel="noopener">Kuala Lumpur Composite Index (Klci) (FBMKLCI INDEX)</a> is the flagship index of the Bursa Malaysia. The index has 30 stocks and is a free float weighted market cap index. The next rebalance will be announced on 3 December and will be effective after the close of trading on 18 December.</p><p>The review uses today's closing price to determine the stocks to be included into and excluded from the index. We see <a href="https://www.smartkarma.com/entities/supermax-corp-bhd" target="_blank" data-smartkarma-citation="entities:12883:1" rel="noopener">Supermax Corp (SUCB MK)</a> being included in the index, replacing <a href="https://www.smartkarma.com/entities/klccp-stapled-group" target="_blank" data-smartkarma-citation="entities:7148:1" rel="noopener">KLCCP Stapled (KLCCSS MK)</a>. Glove makers should have a weighting of 14.23% in the <a href="https://www.smartkarma.com/entities/kuala-lumpur-composite-index" target="_blank" data-smartkarma-citation="entities:22913:1" rel="noopener">Kuala Lumpur Composite Index (KLCI) (FBMKLCI INDEX)</a> post the change.</p><p><a href="https://www.smartkarma.com/entities/kossan-rubber-industries" target="_blank" data-smartkarma-citation="entities:20482:1" rel="noopener">Kossan Rubber Industries (KRI MK)</a> has dropped out of the list of potential inclusions following the momentum unwind, while <a href="https://www.smartkarma.com/entities/genting-bhd" target="_blank" data-smartkarma-citation="entities:14210:1" rel="noopener">Genting Bhd (GENT MK)</a> and <a href="https://www.smartkarma.com/entities/genting-malaysia-bhd" target="_blank" data-smartkarma-citation="entities:3141:1" rel="noopener">Genting Malaysia (GENM MK)</a> have rallied to avoid index deletion.</p><p>We estimate passive funds will need to buy 0.35 days of ADV on <a href="https://www.smartkarma.com/entities/supermax-corp-bhd" target="_blank" data-smartkarma-citation="entities:12883:1" rel="noopener">Supermax Corp (SUCB MK)</a>, while passive selling on <a href="https://www.smartkarma.com/entities/klccp-stapled-group" target="_blank" data-smartkarma-citation="entities:7148:1" rel="noopener">KLCCP Stapled (KLCCSS MK)</a> will be around 13 days of ADV.</p><p><a href="https://www.smartkarma.com/entities/klccp-stapled-group" target="_blank" data-smartkarma-citation="entities:7148:1" rel="noopener">KLCCP Stapled (KLCCSS MK)</a> was an inclusion at the previous review in June, and its short stay in the index looks like coming to an end.</p>

The Kuala Lumpur Composite Index (Klci) (FBMKLCI INDEX) is the flagship index of the Bursa Malaysia. The index has 30 stocks and is a free float weighted market cap index. The next rebalance will be announced on 3 December and will be effective after the close of trading on 18 December.The review uses today's closing price to determine the stocks to be included into and excluded from the index. We see Supermax Corp (SUCB MK) being included in the index, replacing KLCCP Stapled (KLCCSS MK). Glove makers should have a weighting of 14.23% in the Kuala Lumpur Composite Index (KLCI) (FBMKLCI INDEX) post the change.Kossan Rubber Industries (KRI MK) has dropped out of the list of potential inclusions following the momentum unwind, while Genting Bhd (GENT MK) and Genting Malaysia (GENM MK) have rallied to avoid index deletion.We estimate passive funds will need to buy 0.35 days of ADV on Supermax Corp (SUCB MK), while passive selling on KLCCP Stapled (KLCCSS MK) will be around 13 days of ADV.KLCCP Stapled (KLCCSS MK) was an inclusion at the previous review in June, and its short stay in the index looks like coming to an end.

KLCI Index Rebalance Preview: Glovemaker to Take a Real Estate Spot

Malaysia

Kossan Rubber Industries Berhad manufactures and sells rubber products. Through its subsidiaries, the Company also manufactures and trades latex examination gloves as well as fabricates and installs machinery.

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Kossan Rubber Industries (KRI MK)

Sri Trang Gloves (Thailand) Public Company Limited (STGT TB): Short-Term Pain; Long-Term Gain

With strong financials and aggressive capacity expansion plans, STGT can be a long-term bet to gain from the post pandemic global gloves demand boom.

Tina Banerjee

Solid 9MFY21 Results

<p>Solid 9MFY21 Results Last Traded: RM2.44 [...] Kossan reported 9MFY21 net profit of RM2.6bn (+383.8%), which came in at 85.2% and 83.8% of our...

TA Securities Holdings Bhd

A Solid 1H21

Buy Kossan Rubber Industries Bhd: A Solid 1H21. - By: TA Securities Holdings Bhd

TA Securities Holdings Bhd

Intco Medical IPO Initiation: Riding the Cycle

Intco is seeking an H Share listing to raise $1 billion, according to press reports. Overall, we think that Intco has attractive fundamentals to...

Arun George

KLCI Index Rebalance Preview: Glovemaker to Take a Real Estate Spot

Supermax is expected to join the KLCI after its eye-popping rally this year, taking the place of KLCC. Glove makers will have a weight of over 14%...

Brian Freitas

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