KUALA LUMPUR (Dec 18): Shares in Top Glove Corp Bhd rose 3.22% this morning after the glove maker’s first quarter ended Nov 30, 2019 (1QFY20) saw net profit grow marginally by 1.2% to RM111.43 million or 4.36 sen per share, from RM110.06 million last year or 4.31 sen per share, following a greater contribution from the nitrile glove segment.
At 9.15am, Top Glove added 15 sen to RM4.81, valuing it at RM12.32 billion.
Quarterly revenue fell 4.2% to RM1.21 billion from RM1.26 billion, following lower average selling prices and raw material prices.
Meanwhile, Affin Hwang Capital Research has maintained its “Buy” rating on Top Glove at RM4.66 with a higher target price (TP) of RM5.40 (from RM5.20) and said Top Glove reported a decent set of numbers: 1QFY20 core-PATAMI of RM111.4 million (+39.2% q-o-q; +1.2% y-o-y) is slightly ahead of house but within consensus estimates, delivering 26% and 22% of the respective forecasts.
In a note today, the research house said the improvement in earnings can be attributed to the higher sales volume and the recovery in margin, as competition in the latex segment has eased.
“We are expecting stronger quarters ahead, with new capacity expected to start contributing in 2HFY20.
“Reiterate Buy and raise our TP to RM5.40,” it said.