KUALA LUMPUR (July 28): Analysts have maintained their calls on rubber glove manufacturer Kossan Rubber Industries Bhd despite its record-breaking net profit for the second quarter ended June 30, 2021 (2QFY21) as glove average selling prices (ASPs) have peaked and are expected to taper off in the second half of 2021 (2H21).
MIDF Research analyst Ng Bei Shan wrote in a note today that Kossan’s first half ended June 30, 2021 (1HFY21) core net profit of RM2.16 billion was deemed to be in line, but softer results are expected for 2HFY21.
“Kossan’s 1HFY21 core net profit of RM2.16 billion was largely within our and consensus expectations. The cumulative core net income made up 55.7% and 65.3% of our and the consensus full-year estimates respectively.
KUALA LUMPUR (Jan 26): Public Invest Research has initiated an outperform call on Inari Amertron Bhd with a target price of RM3.80, as it sees Inari is poised for a strong comeback in FY21, benefitting from the deployment of 5G wireless.
Its analyst Chua Siu Li said in a note today that after two consecutive years of earnings decline, Inari is poised for a strong comeback in FY21, as she expects it to benefit from the deployment of 5G wireless technology with more radio frequency (RF) contents to be included in 5G devices.
“We believe Inari will greatly benefit from the transition to the emerging 5G technology, given that the wireless technology evolution will result in higher number of frequency bands supported by 5G devices, which in turn, increases the need for more RF filters to be fitted,” she said.
KUALA LUMPUR (Dec 18): PublicInvest Research has downgraded Top Glove Corp Bhd’s rating to neutral from trading buy as it lowered its target price (TP) to RM7.30 from RM9.70 as concerns remained over environmental, social and governance (ESG)-related issues.
The research house’s analyst Chua Siu Li said in a note today that she did not discount the fact that glove makers like Top Glove will continue to deliver record-breaking profit for the coming quarters as average selling prices (ASPs) are expected to increase by another 30% quarter-on-quarter (q-o-q) in the second quarter ending Feb 28, 2021 (2QFY21).
“However, with the ESG issues uncovered recently, we are incorporating a 20% ESG discount to our valuation of Top Glove, from a price-earnings multiple of 10.5 times previously, to eight times currently (at its five-year historical mean), taking into account lingering concerns over ESG-related issues,” she said, adding that her TP was subsequently lowered to RM7.30.