Hartalega has front-loaded its capex and we expect this to bring forward their capacity expansion plans. Consequentially, management has guided that Hartalega would be taking up a revolving credit facilityin FY16 (Mar) to ease cash flow for the firm. We switch our valuation to DCF from one-year forward P/E. We downgrade to NEUTRAL (from Buy) with a lower TP of MYR8.48 (vs MYR8.60), 0.3% downside
1M4UIt's like musical chair, one way rocket to the moon since IPO in 2008...valuations too high... Valuations getting out of market ranges for rubber gloves maker,,,,be it PE or P/NAPS. Law of diminishing returns in operation and is acelerating....the revenue generated per million pcs of glove produce is fast falling....so is dividend yield at this high price..