Rubber Products (Gloves, Condoms etc)

Re: Rubber Products (Gloves, Condoms etc)

Postby winston » Wed Dec 16, 2020 4:09 pm

CGS-CIMB Research maintains overweight on gloves

[quote]
Glove stocks should record stronger earnings in quarters ahead, driven by:
i) higher average selling prices (ASPs)
ii) rise in production capacity and
iii) better economies of scale

Glovemakers continue to highlight that their capacity is fully taken up until at least 1QCY22.

We expect that in the next two to three years, global glove supply will grow 15%-25% annually on the back of higher usage and increased healthcare awareness globally.

Glovemakers expect ASPs to continue rising on a monthly basis up to at least end-1QCY21.

Ability to pass on rising raw material prices (nitrile butadiene: +40% year-to-date, latex: +28% year-to-date)
[quote]

Source: The Star

https://www.thestar.com.my/business/bus ... -on-gloves
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Re: Rubber Products (Gloves, Condoms etc)

Postby winston » Fri Dec 18, 2020 9:22 am

Rubber Gloves – Malaysia
Prospects Are Intact But May Be Weighed By Sentiment


Industry prospects remain intact against the backdrop of undemanding valuations and
attractive dividend yields.

But we acknowledge:
a) unparalleled valuation surge;
b) yetto-be ascertained 2022 ASPs; and
c) negative sentiment may prove to be too steep of a speed bump to near-term prospects.

As such, we have trimmed our target prices.

Maintain OVERWEIGHT on the sector as we believe the risk-reward trade-off still
remains attractive. Top pick: Top Glove.

Key risks:-

a) Although we do not expect demand to cliff dive upon mass inoculation of the COVID-19 vaccine, the sudden need for gloves may quickly dissipate unexpectedly. This could arise from an unaccounted multiplier effect of demand (single source of demand translating into multiple orders across the supply chain), which may swiftly diminish. Alongside that, the premiums commanded for contracted and spot ASPs;

b) nitrile latex cost is expected to peak by 3-4x pre-COVID-19 levels that could curtail earnings if ASPs revert sharply. However, this is in part driven by demand for nitrile gloves. Therefore, any normalisation on glove demand should translate into nitrile latex cost normalising too; and

c) further COVID-19 outbreaks in the labour force, disrupting operations.

Source: UOBKH

https://research.uobkayhian.com/content ... 8fff693c81
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Re: Rubber Products (Gloves, Condoms etc)

Postby winston » Tue Dec 29, 2020 2:52 pm

No year-end party for glove bulls

by Tan Siew Mung

“Although the valuations of glove companies have come down significantly from a very high level in the early part of this year, the news on the rollout of vaccines will continue to weigh on the market sentiment surrounding glove stocks.

“A strong rebound in share price is unlikely but there might be opportunity when the valuation of glove stocks gradually normalise to their historical average”.


“The question now is not about how much profit they can make in 2021, but how much growth is left. The market is looking past the profit of glove companies in 2021, and its focus is now on any potential reversion in glove average selling price, which might come in as early as the second half of 2021.

“The key question now lies on when will the balance of demand and supply of gloves be restored, where it is going to trigger a downtrend in glove prices”.


Astronomical earnings for glove companies are temporary; thus he believes glove share prices have already priced in such events.

“Even if you see there is a value for glove makers, you will still want to wait for a while. Funds are profit taking, you don’t know how low it can go”.

He also noted that it is worth looking at glove makers for potential return either from dividends or from distribution (such as treasury shares or bonus issue), because of their bumper earnings next year.


Source: The Edge

https://www.theedgemarkets.com/article/ ... love-bulls
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Malaysia - Market Direction & Strategy

Postby behappyalways » Mon Jan 04, 2021 6:40 pm

Top 4 glove makers see RM13.5b wiped out from market cap
https://www.thestar.com.my/business/bus ... market-cap
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Re: Rubber Products (Gloves, Condoms etc)

Postby winston » Tue Jan 05, 2021 7:51 am

Glove stocks see heavy selling as ban on regulated short selling lifted

by Arjuna Chandran Shankar

In total, some 168.63 million shares of glove companies worth RM948.42 million were shorted by investors today, with 106.11 million Top Glove shares worth RM573.22 million involved.

Kossan saw an RSS volume of 23.26 million shares worth RM92.1 million, while Hartalega was shorted to the tune of 18.75 million shares worth RM197.56 million. Supermax saw 11.08 million shares shorted at a total value of RM61.75 million.

Top Glove lost RM3.99 billion in market capitalisation today, Kossan lost RM1.43 billion, Hartalega lost RM5.69 billion and Supermax lost RM1.36 billion.

All in all, RM12.47 billion was wiped out from the cumulative market capitalisation of the big four glove stocks.


Source: The Edge

https://www.theedgemarkets.com/article/ ... ing-lifted
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Re: Rubber Products (Gloves, Condoms etc)

Postby winston » Wed Jan 06, 2021 9:06 pm

Demand for rubber gloves to stay elevated

KUALA LUMPUR: Kenanga Research expects demand for rubber gloves to remain resilient with the vaccine potentially taking years before it will reduce the spread of Covid-19 infection.

"To reduce the spread of Covid-19 infection, vaccine coverage has to reach 60-70% to achieve some degree of herd immunity," said Kenanga.

Meanwhile, the spread of the new strain of fast-spreading coronavirus further casts doubt that the pandemic situation will be resolved soon.

It added that scaling up production of vaccines and distribution could pose a challenge, which means the pandemic is likely to remain in 2021.

The research house said earnings growth in 1Q21 and lead times of over 365 days indicated demand will stay resilient given that buyers are unlikely to put down deposits if they expected demand to ease soon.

In addition, the temporary production disruption experienced by some glove makers could potentially exacerbate a supply shortage.

"Based on our sensitivity analysis, assuming ASP normalizes to UD35/1,000 pieces and hence with PER valuation tracking back to pre-COVID 5-year historical forward mean, current glove makers’ share prices are indicating potential upside from here.

"Note that current latex and nitrile ASP average USD50 and USD90 to USD110, respectively and expected to be higher in 1Q CY21," said Kenanga.

It has a an "outperform" recommendation on Hartalega, its top sector pick with a target price of RM21.

It also has an "outperform" on Top Glove with a target price of RM8.50.

Source: The Star

https://www.thestar.com.my/business/bus ... y-elevated
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Re: Rubber Products (Gloves, Condoms etc)

Postby behappyalways » Mon Jan 11, 2021 10:32 am

八点最热报 10/01/2021 疫苗面世疫情或趋缓 2021手套股还有看点?
https://m.youtube.com/watch?v=DpF9hnF4t9I
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Re: Rubber Products (Gloves, Condoms etc)

Postby winston » Tue Jan 12, 2021 2:25 pm

Rubber Gloves
4QCY20F preview: Another strong showing


We forecast UGHC and RSTON to report another quarter of record earnings in 4QCY20F, with net profits jumping 54x/8.5x yoy, respectively.

Fundamentals of glovemakers remain strong as ASP uptrend continues, which could support stronger earnings in quarters ahead.

We see value emerging post the removal of share price overhang (lifting of
Bursa’s short-selling restriction). Maintain Add on UGHC and RSTON.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 576B290C6C
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Re: Rubber Products (Gloves, Condoms etc)

Postby winston » Wed Jan 13, 2021 9:17 pm

Glove bear JP Morgan tells clients gloves ain’t needed during vaccinations

by Ahmad Naqib Idris

KUALA LUMPUR (Jan 13): JP Morgan, which initiated coverage on the Malaysian rubber glove sector with "sell" calls in December, reminded investors that gloves are “not needed” while administering vaccinations.

Citing the Centers for Disease Control and Prevention of the US, the National Health Service of the UK and the British Columbia Centre for Disease Control of Canada, the American bank said medical officers are not required to wear gloves while carrying out vaccination.

“Gloves are needed only if the healthcare workers are likely to come into contact with body fluids or if there is an open wound. Guidelines also state that even after wearing gloves, constant sanitisation between each patient would be the best way to minimise the risk of disease transmission,” it wrote.

Glove prices may have peaked as testing efforts have started to plateau in most countries, especially developed ones. The bank pointed out that the current unprecedentedly strong demand was due mainly to high testing activities globally, particularly in the developed countries.

It expects glove prices to reach a peak by the first half of 2021, with prices and profits to normalise thereafter.

At the time, the average selling price stood at US$140 versus US$22 pre-Covid-19, which the bank said was driven by unsystematic buying.


Source: theedgemarkets.com

https://www.theedgemarkets.com/article/ ... ccinations
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Re: Rubber Products (Gloves, Condoms etc)

Postby winston » Wed Jan 13, 2021 9:22 pm

AmBank Research sees 'limited upside' to glovemakers at current prices, cuts target PER by 10%

by Hamsaveni Visuvaseven

“Although we hold the view that demand for gloves will remain stable post-Covid-19, we expect ASP to decline as there is no longer a rush for gloves compared to what happened at the beginning of the pandemic.

Nonetheless, we expect ASP will stabilise at a higher level than the pre-pandemic level due to the broader usage of gloves.

Moreover, capacity expansion from glove companies will be able to cope with the future demand,” he said.


Source: theedgemarkets.com

https://www.theedgemarkets.com/article/ ... -target-10
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