(Post date : 25 August 2010)
Latexx Partners Berhad is located in Kamunting Industrial Estate, north of peninsular Malaysia, with close proximity to Penang seaport and Penang international airport.
The company started its operation in 1988. Today, Latexx is one of the largest medical examination gloves producers in Malaysia. It is presently the largest glove manufacturing company with all its factories built in one single location. The company is embarked on an aggressive expansion plan. The current capacity is 6 billion pieces of gloves annually. By the year 2011, the capacity is expected to increase to 9 billion. The expansion plan will further continue. By 2013, a target of 12 billion gloves is set. And, by year 2015 to achieve a shipment target of 15 billion gloves per annum.
We cater and distribute our gloves worldwide, capitalizing on our strong market representation around the world. Currently our gloves are distributed to 80 countries, serving more than 300 customers.
Hospital
A variety of medical gloves are now offered to hospitals. Because medical gloves are an important protective barrier for personnel and patients alike, it is essential that one make an educated choice to ensure that the glove provides the necessary protection
Dentistry
The recommendation for glove wearing has been made to protect both the operator and the patient from cross-infection. The routine use of gloves should protect the dental team from blood borne viruses such as hepatitis B, C and HIV.
Laboratory
Glove selections are important when handling the toxicity and hazards of the materials. Use of hand-care tool is necessary when work with high acute toxicity and those with significant chronic effects.
Food
Proper use of gloves must be monitored and prevented from being used in ways that result in cross-contamination. Various types of gloves are employed in the food industry both to protect the food worker from occupational exposures related to food product or process, as well as to prevent pathogen transmission from the worker to the product.
Beauty & Cosmetic
Gloves are essential for performance of the services that are effectively protective, yet gentle with skin. Frequent hand washing and chemical use can lead to skin disorders, therefore gloves use is meant for protection.
Others
Latex gloves are recommended in applications where gloves are worn for a longer period of time or exposed to greater stress. Nitrile gloves also have chemical barrier properties that give them an advantage when handling certain chemicals.
Financial Highlights
Latexx stock is currently in the downtrend, and closed at the price of RM3.11 on 25th August 2010. Since April 2010, it has been trading below the price of RM4 and did not move up more than this point. Compared to the low point during March 2009 at the price of RM0.53 and the highest point during January 2010 at the price of RM4.93, it is currently trading below the 38.2% retracement level. During June and August 2010, the stock price has been trading at the price of RM3.25, which is at the 38.2% retracement of the stock price since March 2009. 50% retracement is at about RM2.73, this point is also a strong support level as there were two historical resistance points that becomes the new support line.
Compared to current price at RM3.11, 50% retracement level (RM2.73) is not very far from now. From the technical analysis theory, the stock show no obvious sign of uptrend in near term, and the outlook for glovemakers in coming quarters is not so promising as well compared to the last few quarters. So, mostly in coming quarters, the stock price will be subjected to further drop and will reach the level of 50% retracement or even lower price at the 61.8% retracement (RM2.12)? If you refer to the article below, you may find they all positive with the outlook for the rubber glove stocks in the first or two quarters of year 2010. But after this, will the rubber glove industry grow as strong as last year or follow the expected slowdown worldwide economy pace in coming quarters?
Thursday January 7, 2010
Rubber glove stocks spring upwards on good prospects
By HANIM ADNAN
PETALING JAYA: Rubber glove stocks riding high on the prospects of sustainable growth in demand, posted the best gains on Bursa Malaysia yesterday.
Supermax Corp Bhd tops the gainers list to close 65 sen higher at RM5.35.
Nitrile glove maker Hartalega Holdings Bhd rose 51 sen to RM6.72, Rubberex Corp (M) Bhd firmed 43 sen to RM2.75 while Kossan Rubber Industries Bhd and Adventa Bhd were each 35 sen higher at RM5.84 and RM3.48 respectively.
CIMB Research yesterday released an optimistic report indicating that the rubber gloves sector was in a good shape after experiencing a spectacular year in 2009.
The brokerage is maintaining an overweight stance with factors that could extend a re-rating including continued uptake in demand from the healthcare industry, ongoing capacity expansion and above-market earnings growth driven by major expansions by many local gloves companies.
CIMB Research said that over the next two years, industry giants like Top Glove Corp Bhd, Supermax and Latexx Partners Bhd would be adding annual capacity of 3 billion to 7 billion pieces to capture a bigger slice of the expanding world market.
“We believe demand will be resilient (this year) and continue to grow given the hygiene awareness, health regulations and population size,” it said.
In 2009, customers’ order returned to normal with latex prices coming down from record levels, the strengthening of the US dollar and the outbreak of the H1N1 pandemic in the second quarter leading to a rubber glove shortage which many manufacturers believe would continue into 2010.
Supermax group managing director Datuk Seri Stanley Thai told StarBiz that he was bullish about the sector’s performance for the next six months.
“I expect it to remain in an oversold position (higher demand and lower supply situation).” he added.
He said it was timely for both local and foreign funds to consider the glove sector in their equity portfolios for 2010 given its resilient status.
“2009 was a really good year for local rubber glove players. It was unlike in 2008, especially between June and September, when players faced the toughest challenge when crude oil prices hit a record US$140 per barrel on the back of the Government’s unexpected announcement on the electricity, natural gas and gasoline price hikes,” added Thai.
He said the sudden increase in the utility costs had disrupted most rubber gloves players’ cost structure and suffers margin squeeze as many had sold their production capacity two months ahead.
Utility cost represents about 50% of the glove makers’ total cost of production.
“We (players) are used to the volatility in raw material prices and foreign exchange because that is the nature of our business. However, we fear sudden changes in the Government policy especially on the utility costs and subsidies,” he added.
Kossan Group corporate affairs senior manager Edward Yip said the H1N1 pandemic that gripped the world last year had helped restore the industry to a stronger position.
“Both the developed and even developing nations are imposing more stringent rules on healthcare. Rubber glove makers are definitely riding on this trend with the prospect looking good over the next one to two years,” he said.
He noted that most glove manufacturers practised an efficient costing and pricing mechanism, using the average latex price for the previous month to set the current month’s selling price.
Thus, they can pass on the higher latex cost to customers.
Local rubber glove makers contributed about 65% of the total world rubber gloves demand estimated at 145 billion pieces per year.
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