KUALA LUMPUR: Rubber glove makers extended their gains in the afternoon session on Wednesday, Oct 20, reversing their losses from early on in the day after CIMB Research maintained its overweight call on the sector and said the results that rubber glove companies announced during August-October were mostly in line with its expectations, except for Adventa and Top Glove which missed expectations.

At 3.45pm, Latexx as up 27 sen to RM3.13, Kossan added 18 sen to RM3.38, Adventa was up 15 sen to RM2.56, Supermax added 11 sen to RM4.76, Rubberex rose six sen to 91.5 sen, Top Glove up four sen to RM5.72 while Hartalega added three sen to RM5.45.

CIMB Research said despite the 36% year-on-year surge in core net profit for the six companies under its coverage during their recent results (quarters ending June to August), their average quarterly core net profit declined almost 4% quarter-on-quarter due to the unrelenting high level of latex prices, weak US dollar and softening demand.

"We continue to believe that these hiccups are only temporary as rubber glove demand remains resilient due to their importance to the healthcare industry.

"In light of this, we maintain our Overweight call on the sector. Potential re-rating catalysts include the continuing uptick in demand, capacity expansion and strong earnings growth," it said in a note on Wednesday.

The shares of glove makers initially fell this morning after the Malaysian Rubber Glove Manufacturers' Association (MARGMA) had advised its members to increase and adjust prices to be in tandem with high raw material costs and continued weakening US dollar.

MARGMA president K M Lee said on Tuesday most rubber glove manufacturers had started raising prices of their products to reflect the increasing raw material costs and the weakening of the US dollar.

"If the orders forthcoming do not match the glove price requested, glove makers have no choice but to reduce the output," said Lee.