Good returns seen for rubber glove sector

TheStar Fri, May 15, 2020 09:40am - 4 years View Original


For 2020, UOB Kay Hian Research said the big-three producers have their expansion plans intact, foreseeing Hartalega Holdings Bhd and Kossan Rubber Industries Bhd to add capacity close to 10% and Top Glove Corp Bhd expanding capacity by 14%.

PETALING JAYA: The average selling price for the rubber glove sector has surged on the back of higher demand for protective personal equipment and a potential second wave of Covid-19 as delivery lead times lengthen.

UOB Kay Hian Research said the average selling prices have risen more than 10% from 3% to 5% previously, while the delivery lead times have extended to three to four months from the one to two months.

“Given the fluidity of the outbreak, we have resorted to a blue-sky scenario in our attempt to fully capture the earnings upside associated with the demand upswing against potential peak valuations.

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