Karex / Goh Siang

[winston]

On the comeback trail

1QFY6/21 core net profit of RM5.3m (>100% yoy) beat expectations, at 26.4% of our full-year estimate and 51.6% of Bloomberg consensus.

We expect Karex to post stronger quarterly earnings over the next nine months, driven by higher sales volumes and ASP for its condoms.

We reiterate our Add call with a higher TP of RM1.38 (26x CY22 P/E).

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... CFF9501AEB

[winston]

not vested

2Q earnings hit by Covid-19 related costs

We deem 1HFY6/21 net profit of RM9.9m (up >100% yoy) to be below, at 45% of our full-year estimates, but in line with Bloomberg consensus’ (51%).

We expect Covid-19 impact, in terms of higher costs (i.e. Covid-19 testing, and sanitisation activities) and lower production, to weigh on 3QFY21 results.

Reiterate Add, with a lower TP of RM1.15 (26x CY22F P/E).

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 6D50EB48DD

[winston]

not vested

Karex to see earnings recovery from OBM and gloves, says HLIB

by Tan Siew Mung

Management claimed that since condom selling prices fell by about 30% to 40% since FY17, prices had nearly fully recovered.

Karex also shared that it had incurred higher costs in FY21, including raw material costs which had risen considerably, freight costs which had more than tripled and spending incurred to curb the spread of Covid-19.

Source: theedgemarkets.com

https://www.theedgemarkets.com/node/558863

[winston]

not vested

Near-term earnings to remain weak

9MFY6/21 core net profit of RM6.5m was below expectations due to
production disruptions (Covid-19) and delivery delays (container shortage).

We expect Karex’s near term outlook to remain weak due to implementation
of MCO3.0 and higher operating expenses.

Reiterate Add. Our lower TP of RM0.77 is still based on 26x CY22 P/E.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... D4481ECF5B