STGT the favoured Thai stock -well removed from Thai economic malaise.
STGT is now my favored Thai quality, ample liquid trading, high growth stock -well removed from the Thai economy/politics/tourism/middle income trap.
Thai STGT (72) just now trades at a current p/e of around 16, yet its earnings keep (and will keep) soaring going forward as it can't produce enough what the world now most needs: surgical/examination rubber gloves -of all kinds. This company has a superb CG record -and its factories are CV19 free, vs its Malaysian competitor just reported CV19 infections at its plants. STGT has its factories in the South (Surat Thani) far away from any student protests in Bangkok. Here is their English comprehensive web site: https://www.sritranggloves.com/en#fp-greeting
Consider, the Thai SET average p/e is around 25 -and yet STGT which is growing much faster is rather often one of the most actively traded stocks on the SET. Malaysia and Thailand are the world's leading glove manufacturers by far -and there are tremendous barriers to entry in this industry. (i.e. Huge capital investment and various needed international certifications). Not least, the raw material which is often latex rubber. Thailand is the worlds' leader, number 1, natural latex rubber producer. Prices of its gloves have been on the increase (due to latex prices) and so are Net profit margins which hover around 35% and with an ROE of 24%. ! Far, far superior then the SET averages.
STGT trades at an undeserved discount to its Malaysian competitor, and is now seeking listing on the Singapore stock exchange. If its valuation was the same as TopGlove, STGT would trade at 100 Baht a share, or more. STGT just announced a 1.25 interim Baht dividend (XD is on Nov 30) and a 2 for 1 stock split. Its stock price just corrected from around 90 Baht on the vaccine news, but this will hardly dent global high demand for its gloves which are all but sold out for 2-3 years to come. More people around the world, in all sorts of places & venues and endeavors are increasingly wearing gloves on and off the job. Such gloves are non-perishable and need replacement everyday. Some 90% of its total sales are exported with China and USA/EU being their biggest markets. STGT has already announced production capacity increases -and yet remains in great financial position due its recently very successful IPO capital raising.
Here you can see the profile and stock price of Malaysia's TopGlove, its only true competitor whose current p/e ratio is around 33, or near double STGT why? https://www.bloomberg.com/quote/TOPG:MK?sref=0BtldCyo
My investment view remains very positive on STGT at current mkt. prices, in this uncertain world where increasingly more people of all sorts are paying attention to hygiene and viruses, before and after CV19, -as there a thousand viruses on the loose and its difficult to make a case glove usage will peter off post vaccination on CV19 next year or beyond. Its an increasing new habit by billions, which will not vane. I can see STGT's dividend amount to keep doubling yearly, for years to come and its stock price being above 100 at some point next year!Paul A. Renaud. www.thaistock.com