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Kossan 3Q15 Net Profit Jumps 60% On Higher Sales
Malaysia Daily Bulletin | 20 November 2015
  • Higher gloves sales, a better product mix and improved operational efficiency have sent latex gloves manufacturer Kossan Rubber Industries’ 3Q15 earnings surging 60.4 percent to RM55.2 million. Revenue in the quarter gained 34.5 percent to RM441.7 million.
  • The group shared that all three divisions (technical rubber, gloves and clean-room) continued to perform well with positive increases in turnover and profit before taxation in 3Q15.
  • For the nine-month period, top and bottom lines grew 27.5 percent and 39.9 percent to RM1.2 billion and RM147.3 million respectively.
  • Riding on the strong order book, the firm said that all its plants are in almost full operations and are churning out 22 billion pieces of gloves per annum.

Significance: While the group had a good performance, AmResearch has downgraded the stock to ‘Hold’ with a revised fair value of RM9.40 mainly due to its rich valuations and the limited upside potential to its fair value. On the other hand, CIMB Equities Research retained its ‘Add’ call on the firm with a higher target price of RM9.80 after rolling forward its valuation.

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