Top Glove, Kossan fall as ringgit shows its strength

by **Cals** Fri 09 Oct 2015, 00:10

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[size=28]Top Glove, Kossan fall as ringgit shows its strength

By Supriya Surendran / theedgemarkets.com | October 8, 2015 : 11:02 AM MYT

KUALA LUMPUR (Oct 8): Glove manufacturers Top Glove Corp Bhd ([You must be registered and logged in to see this image.] Valuation: 1.10, Fundamental: 2.50) and Kossan Rubber Industries Bhd ( Valuation: 0.70, Fundamental: 2.10) saw their share price fall as much as 1.7% to RM8.04 and 1.8% to RM7.83 respectively this morning, following a stronger performance from the ringgit.

Yesterday, the ringgit had strengthened to 4.1745 against the US dollar, following a rebound in crude oil prices and better-than-expected trade numbers. However, this morning the ringgit weakened to 4.2222 against the greenback.

At 10.45am, Top Glove shares were trading down 1.4% at RM8.06 with 1.1 million shares traded, while Kossan shares were trading down 1.6% at RM7.85 with 186,500 shares traded.

In its fourth quarter 2015 outlook report, MIDF Research said it is maintaining its positive stance on the glove sector, despite the average price-to-earnings ratio (PER16) for the four largest glove stocks being at an all-time high of 25 times.

"Despite the high PER16, we reaffirm our positive call on the sector as we believe that the demand for rubber gloves, mainly nitrile, is still strong.

"Moreover, we still believe that the demand for rubber gloves will be able to cater to the robust expansion plans by the glove companies and that the fundamentals of the rubber glove sector will remain favourable," said MIDF Research in its report today.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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