Plant utilisation of rubber glove makers improve

TheStar Mon, Mar 11, 2024 12:00am - 2 months View Original

PETALING JAYA: While many are still bearish on the glove sector, AmInvestment Bank Research (AmResearch) has an “overweight” call, and is of the view that there is an opportunity for investors to bottom fish for stocks like Hartalega Holdings Bhd and Kossan Rubber Industries Bhd.

It notes that the recent share price weaknesses for Hartalega and Kossan were predominantly due to the market pricing in the weaker-than-expected results reported by both companies last month, as investors were sceptical on the timeliness of demand recovery.

“Nevertheless, we view this as an opportunity for investors to bottom fish for Hartalega and Kossan as their high plant utilisation (PU) of 90% in March 2024 and continued quality issues among Chinese glove makers could meaningfully address doubts about demand recovery and re-catalyse market interest,” the research firm said in a report.

It said both Hartalega and Kossan missed its expectations and consensus’, primarily attributable to lower-than expected sales volume as a result of Red Sea-related shipment delays.


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Related Stocks

HARTA 3.640
KOSSAN 2.490


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