KUALA LUMPUR: Rubber glove makers pared down their earlier losses on Wednesday, Oct 20 after CIMB Research maintained its overweight call on the sector and said the results that rubber glove companies announced during August-October were mostly in line with its expectations, except for Adventa and Top Glove which missed expectations.
At 12.10pm, Latexx was up 13 sen to RM2.99, Kossan added eight sen to RM3.28, Adventa and Supermax up five sen each to RM2.46 and RM4.70 respectively, Hartalega up four sen to RM5.46, Top Glove rose one sen to RM5.69 while Rubberex added 1.5 sen to 87 sen.
CIMB Research said despite the 36% year-on-year surge in core net profit for the six companies under its coverage during their recent results (quarters ending Jun to Aug), their average quarterly core net profit declined almost 4% quarter-on-quarter due to the unrelenting high level of latex prices, weak US dollar and softening demand.
"We continue to believe that these hiccups are only temporary as rubber glove demand remains resilient due to their importance to the healthcare industry.
"In light of this, we maintain our Overweight call on the sector. Potential re-rating catalysts include the continuing uptick in demand, capacity expansion and strong earnings growth," it said in a note on Wednesday.
At 12.10pm, Latexx was up 13 sen to RM2.99, Kossan added eight sen to RM3.28, Adventa and Supermax up five sen each to RM2.46 and RM4.70 respectively, Hartalega up four sen to RM5.46, Top Glove rose one sen to RM5.69 while Rubberex added 1.5 sen to 87 sen.
CIMB Research said despite the 36% year-on-year surge in core net profit for the six companies under its coverage during their recent results (quarters ending Jun to Aug), their average quarterly core net profit declined almost 4% quarter-on-quarter due to the unrelenting high level of latex prices, weak US dollar and softening demand.
"We continue to believe that these hiccups are only temporary as rubber glove demand remains resilient due to their importance to the healthcare industry.
"In light of this, we maintain our Overweight call on the sector. Potential re-rating catalysts include the continuing uptick in demand, capacity expansion and strong earnings growth," it said in a note on Wednesday.
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