Glove Sector - UOB Kay Hian 2025-10-14: Adopting To A New Equilibrium Of Additional 100% Us Tariffs On China Exports

• Additional 100% US tariffs on China exports from the current high base have limited incremental impacts on Malaysian glovemakers’ earnings.
• Oversupply and sub-optimal utilisation rates are likely to continue to weigh on earnings recovery prospects.

The US raised China’s tariffs by 100%, but limited impact to Malaysian glovemakers’ earnings.

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• Nevertheless, we assess that China’s medical gloves export volume within the US market in 2Q25-3Q25 has dropped significantly since earlier reciprocal tariffs. This is mainly because ASPs are no longer competitive vs competitors even at the previous 80% tariff rate.

Finding grounds from China’s red ocean strategy, industry oversupply remains challenging.

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• Furthermore, some China players are exploring capacity expansion in other ASEAN countries such as Indonesia, Vietnam and Thailand, adding pressure to the current oversupply dynamics.

Anticipating modest earnings recovery in 2H25-2026, lifted by US customers’ restocking cycle.

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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/.

More views on outlook of manufacturing / technology sector:
Analyst Reports on Singapore Manufacturing & Technology Sector

Read also UOB's most recent report:
2025-10-10 Top Glove - Improving Earnings Momentum In 4QFY25, But Challenges Persist.

Previous report by UOB:
2025-06-30 Top Glove 3QFY25 - Weathering Another Weak Quarter; Better Outlook Guidance.

Price targets by 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