Tuesday, December 15, 2015

Topglov: Earnings soared!

Results Update

For QE30/11/2015, Topglov's net profit rose 24% q-o-q or 164% y-o-y to RM128 million on the back of a revenue which rose 13% q-o-q or 41% y-o-y to RM800 million. Revenue increased due to increase in sales volume of 15% y-o-y, largely attributed to nitrile glove sales which increased 54% compared with 1QFY15. PBT soared y-o-y due to  increased levels of efficiency throughout the manufacturing process as a result of intense focus on automation,  R&D  and  re-engineering, which led to enhanced quality output and substantially reduced downtime. The Group's bottom-line was also boosted by the strong US Dollar and lower raw material prices.

Table: Topglov's last 8 quarterly results

Chart 1: Topglov's last 38 quarterly results


Topglov (traded at RM11.90 as at 3.45pm) is now trading at a PE of 20.5 times (based on last 4 quarters' EPS of 58 sen). At this PE multiple, Topglov is fairly valued as compared to Harta & Kossan which are trading at their respective trailing PERs of 40 & 30 times..

Technical Outlook

Topglov is still in an uptrend. The current move may mirror the strong rally of 2009 when the stock rose 280% after surpassing the 20-month EMA line. If Topglov can chalk up a similar gain of 280% after surpassing the 20-month EMA line, then the potential target is RM14.00.

Chart 2: Topglov's monthly chart as at Dec 15, 2015_3.00pm (Source:

Chart 3: Topglov's monthly chart as at Dec 15, 2015_3.00pm (Source:


Based on satisfactory financial performance, fairly attractive valuation & positive technical outlook, Topglov is a good stock for long-term investment.

In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, Topglov.


Ks said...

Alex, whats your view on DSONIC getting the 318mil passport contract.

Teck Heng Kwan said...

Hi Alex, could u share your view on Comfort.