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Hot Stock Kossan rises after proposing bonus
by Cals Tue 03 Sep 2013, 14:41
Hot Stock Kossan rises after proposing bonus
Business & Markets 2013
Written by Jeffrey Tan of theedgemalaysia.com
Tuesday, 03 September 2013 12:27
KUALA LUMPUR (Sept 3): KOSSAN RUBBER INDUSTRIES BHD [] was the seventh top gainer at noon today after it proposed a bonus issue.
Kossan announced yesterday it would distribute one bonus share for one existing unit held. The exercise involves some 319.73 million new shares.
At 12.15 pm today, Kossan shares were traded at RM6.44 after climbing 13 sen or 2.1%, with some 384,000 shares done.
Hong Leong Investment Bank Research analyst Tan J Young said the bonus issue is viewed positively as it will enhance the liquidity and marketability of the shares although there are no fundamental changes.
“We reiterate our ‘buy’ call on the equity with unchanged target price of RM7.30 based on unchanged 12.8 times of CY14 earnings per share,” said Tan.
“We believe Kossan’s balanced 50:50 product mix of nitrile and natural rubber (NR) gloves will allow it to cater to both markets and mitigate risks from sudden price hikes in either product.”
However, Tan said he is conservative given that the glove company has been a sector laggard.
Business & Markets 2013
Written by Jeffrey Tan of theedgemalaysia.com
Tuesday, 03 September 2013 12:27
KUALA LUMPUR (Sept 3): KOSSAN RUBBER INDUSTRIES BHD [] was the seventh top gainer at noon today after it proposed a bonus issue.
Kossan announced yesterday it would distribute one bonus share for one existing unit held. The exercise involves some 319.73 million new shares.
At 12.15 pm today, Kossan shares were traded at RM6.44 after climbing 13 sen or 2.1%, with some 384,000 shares done.
Hong Leong Investment Bank Research analyst Tan J Young said the bonus issue is viewed positively as it will enhance the liquidity and marketability of the shares although there are no fundamental changes.
“We reiterate our ‘buy’ call on the equity with unchanged target price of RM7.30 based on unchanged 12.8 times of CY14 earnings per share,” said Tan.
“We believe Kossan’s balanced 50:50 product mix of nitrile and natural rubber (NR) gloves will allow it to cater to both markets and mitigate risks from sudden price hikes in either product.”
However, Tan said he is conservative given that the glove company has been a sector laggard.
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