- While the Malaysian gloves sector charted an impressive turnaround in 2024 after the COVID-19 lows as expected, risk-reward appears less appealing currently as valuations are trading close to the historical mean based on 2025’s full earnings recovery.
- Downgrade to MARKET WEIGHT.
2025 will be a year of delivery.
- - Read this at SGinvestors.io -
- depletion of excess inventory,
- margin expansion on better efficiency and ramped-up capacity,
- moderating input costs, and
- the US’ revised tariffs on China gloves.
- Against the backdrop of these positives, we reiterate our view that the sector’s earnings are on the cusp of a progressive earnings recovery throughout 2025.
Nevertheless, rationalisation of overhyped market expectations anticipated.
- - Read this at SGinvestors.io -
- We opine that the market may have built up expectations of operating matrixes such as utilisation rate and profitability margin returning to 2019’s level within the upcoming 1-2 quarters, with such optimism fairly reflected in the aggressive share price uptick seen throughout 2024.
US’ higher tariffs on China medical-grade gloves officially began in January.
- Read more at SGinvestors.io.
Above is an excerpt from a report by UOB Kay Hian Research.
Clients of UOB Kay Hian may be the first to access the full PDF report @ https://www.utrade.com.sg/.
Jack Goh UOB Kay Hian Research | https://research.uobkayhian.com/ 2025-01-09
More views on outlook of manufacturing / technology sector:
Analyst Reports on Singapore Manufacturing & Technology Sector
Read also UOB's most recent report:
2026-07-02 Malaysia Glovemakers - Backloaded Pessimism.
Previous report by UOB:
2026-06-19 Top Glove 3QFY26 - Windfall Quarter; Gradual Normalisation Ahead.
Price targets by 2 other brokers at Top Glove Target Prices.
Listing of research reports at Top Glove Analyst Reports.
Relevant links:
Top Glove Share Price History,
Top Glove Announcements,
Top Glove Dividend Payout Dates & Corporate Actions,
Top Glove News
