Gloves Sector Update: Overly Pessimistic?

"- *Two weeks after soft guidance by Harta’s management* in its results briefing, *Malaysian glove companies ??* have seen share price declining by 30-40%.

- *Full impact from US order shifts are not reflected yet??.* Sept-Dec 24 (4Q24) results are already commendable, but note that US distributors frontloaded purchase from China producers...

- *Against 1Q25's softening results?,* 2Q25 will see good pick up as US' purchase recover ...

• *Malaysia production capacity is c.150b ?* (big 4 glovemakers) and running at *U-rate of c.60%* averagely...

- *Challenging outlook in Europe is not something new...

• *China ASP not as low as expected ...

• *Recall that China glovemakers only turnaround into operational profit in 1Q-2Q24...

- *Local glovemakers' global market share?* for medical gloves is highest at *c.40-55%..."
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