Glove Sector Faces Persistent Oversupply Woes Despite US Tariffs, Underweight Rating Upheld

The glove sector remains under pressure due to structural oversupply, despite new US tariffs on Chinese gloves. While tariffs may boost average selling prices in the US, they won’t resolve fundamental issues like oversupply, rising costs, and competition from Chinese manufacturers. The outlook is cautious, with an Underweight rating on the sector. Specific ratings include Underweight on Kossan (target price: RM1.60), Sell on Top Glove (target price: RM0.68), and Hold on Hartalega (target price lowered to RM2.30 from RM3.00 due to increased US market competition and a reduced target price-to-earnings ratio of 17x from 22x).

Glove sector

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