While glove stocks have been underperforming since November of last year as positive news flow on vaccines hit the market, Maybank Kim Eng has advised investors to hold on to some glove stocks.
Maybank Investment Bank is looking at a stock market benchmark index target of 1,830 for this year.
PETALING JAYA: A combination of better earnings and ample liquidity is what will drive the local equity market higher this year.
Maybank Kim Eng regional head (equity research) Anand Pathmakanthan said the investment bank was looking at a 45% year-on-year growth in terms of corporate earnings this year against a decline of 11% last year, supported by continued growth in the earnings of glove companies as well as a recovery in earnings of sectors like banking and plantation.
“Earnings outlook and liquidity – in both areas, 2021 is looking good, “ he said via an online briefing session yesterday organised by Maybank Investment Bank.
IN recent weeks, while the world’s largest glove maker Top Glove Corp Bhd grappled with a Covid-19 outbreak at its staff accommodations in Klang, which led to investigations by the authorities of the group’s operations in five other states, the investor relations (IR) official at another glove company received various enquiries from fund managers seeking assurances that it did not share the same workers’ problems.
Last week, the Ministry of Human Resources opened 19 investigation papers against six companies related to Top Glove for failure to apply for an accommodation certificate from the authorities, which led to the discovery of other offences, including crowded, uncomfortable accommodation and lack of proper ventilation.