Japan reports record spike in potentially deadly bacterial infection


Cases of a dangerous and highly fatal bacterial infection have reached record levels in Japan, official figures show, with experts so far unable to pinpoint the reason for the rise.
https://edition.cnn.com/2024/06/17/asia/japan-record-spike-stss-bacterial-infection-intl-hnk/index.html

Hospital at Sydney is using Hartalega glove COAT

Hartalega (HART MK)
Sector outlook on the upswing
Climbing out of the trough
HART's plant utilization rate continues to improve with higher sales orders
and is now running at c.85% (4QFY24: 73%). ASP outlook is also improving
as HART has managed to fully pass on higher raw material costs to its
customers. Given tight supply, ASP could improve further if demand
surges. HART's order lead time has now increased to 2-3 months (vs. China
glove makers' 3-6 months). We maintain our earnings forecasts and
MYR4.50 TP (on 3.2x F¥26E P/B). HART is our tod BUY for the sector.

Earnings adjustments
We raise FY25/26 earnings forecasts by 35%/19% on factoring in: i) actual
FY24 results, ii) better utilisation rate of 80%/80% (from 75%/80%) and iii)
higher production capacity of 36b/37.5b pcs p.a. (from 31b) for FY25/26.
We also introduce FY27 earnings forecasts. Balance sheet stays strong with
MYR1.4b in net cash (MYR0.40/sh) end-Mar 2024. We peg HART valuation
to its historical PBV mean of 3.2x.

Results above expectations
HART’s 4QFY24 core net profit of MYR1.8m (-97% YoY, -91% QoQ) was above
expectations. Management has turned more positive on the sector outlook
given improving glove demand and the ability to pass on additional raw
material cost to its customers. Plant utilisation rate [UR] has improved to
73% in 4QFY24 on 31b pcs annual capacity. We raise FY25-26 earnings
forecasts by 19-35%. Our TP is also raised to MYR4.50 TP (+14sen) on
unchanged 3.2x rolled forward CY26E P/B. BUY

Malaysia Gloves Sector
Gainer of US tariff hike on
Chinese gloves
Strong re-rating catalyst reduces valuation discounts
We are positive on the Malaysian gloves sector, given latest US trade
retaliation on Chinese rubber medical and surgical gloves, where the
tariffs will be hiked to 25% in 2026 (from 7.5% currently). This higher tariff
is expected to close the price gap between Malaysia and Chinese gloves,
making Malaysia gloves more price attractive in the US (a key export
market). We maintain our BUY on HART (new MYR4.36 TP). We also U/G
TOPG to BUY (MYR1.21 TP) and KRI to BUY (MYR2.70 TP). Our order of
preference are HART, TOPG and KRI.
US retaliation on Chinese-made gloves
The US is hiking tariffs on a wide range of Chinese imports, from
semiconductors, batteries, solar cells, critical minerals, to medical
products including rubber medical and surgical gloves. Tariffs on rubber
medical and surgical gloves will increase to 25% in 2026, from 7.5% now.
Positive impact on Malaysia-made gloves
We expect this latest development to narrow the price gap between
Chinese and Malaysia-made glove, making Malaysia gloves more attractive
in the US market. This market has been important for Malaysia glove
makers (TOPG: 17% of sales, HART: 50%). However, Malaysia glove makers
have been losing market share to their Chinese counterparts since 2021
due to intense price war. While there is a risk that Chinese glove makers
may shift their focus to the European markets (TOPG: 35% of sales, HART:
25%), we believe Malaysia glove makers will be able to compete, especially
after a few rounds of cost rationalization and decommission exercises over
the last two years that have led to better cost efficiency.
Lower discounts on valuations are warranted
While we maintain our earnings forecasts for now, pending results/
earnings release by end-May 2024, we view this latest tariff hike news as
a significant re-rating catalyst for the glove sector. We now assign higher
PBV multiples to the glove makers under our coverage in anticipation of
improving sales. Orders resulting from the US tariff hikes could pick up as
soon as 2H25, we expect. We upgrade TOPG to BUY (from SELL, new
MYR1.21 TP [+41sen], KRI to BUY (from HOLD, new MYR2.70 TP [+62sen]),
while maintaining BUY on HART (+134sen in TP to MYR4.36).
Analyst
POSITIVE [Unchanged]
Wong Wei Sum, CFA
(603) 2297 8679
weisum@maybank-ib.co

Strong re-rating catalyst reduces valuation discounts
We are positive on the Malaysian gloves sector, given latest US trade
retaliation on Chinese rubber medical and surgical gloves, where the
tariffs will be hiked to 25% in 2026 (from 7.5% currently). This higher tariff
is expected to close the price gap between Malaysia and Chinese gloves,
making Malaysia gloves more price attractive in the US (a key export
market). We maintain our BUY on HART (new MYR4.36 TP). We also U/G
TOPG to BUY (MYR1.21 TP) and KRI to BUY (MYR2.70 TP). Our order of
preference are HART, TOPG and KRI.
US retaliation on Chinese-made gloves
The US is hiking tariffs on a wide range of Chinese imports, from
semiconductors, batteries, solar cells, critical minerals, to medical
products including rubber medical and surgical gloves. Tariffs on rubber
medical and surgical gloves will increase to 25% in 2026, from 7.5% now.

Malaysia Gloves Sector
Gainer of US tariff hike on
Chinese gloves

Delta強襲東亞爆代工危機！ 鄭州「千年級」暴雨「滅頂直播」？！-江中博 徐俊相《57爆新聞》網路獨播版-1900 2021.07.21

https://youtu.be/itVLFnbEcNQ

Delta強襲東亞爆代工危機！ 鄭州「千年級」暴雨「滅頂直播」？！-江中博 徐俊相《57爆新聞》網路獨播版-1900 2021.07.21

https://youtu.be/itVLFnbEcNQ

Sapura Energy says subsidiary clinched Mubadala contract for Pegaga development project

Bjasset got strength..gentleman , any news ?