Although Maybank Investment Bank Bhd (Maybank IB) is feeling positive about Top Glove Bhd's latest joint venture (JV) for high-density polyethylene (HDPE) gloves, the research house maintained a HOLD recommendation for the glove manufacturer with an unchanged target price of RM1.08.
It was mentioned that Top Glove's JV with Tronex (Asia) Ltd and Polywel International Trade Company Ltd on a shareholding of 60:20:20 will strengthen its product offerings and market reach while leveraging on Tronex's and Polywel's expertise in the medical and HDPE gloves industries.
The JV comes at a time when Top Glove is diversifying its supply chain amid the prospect of higher US tariffs on glove imports.
Maybank IB said the JV is expected to provide an additional income stream for Top Glove and help further solidify its position in the global glove manufacturing sector.
Despite this positive development, the research house has opted to maintain its earnings forecasts for Top Glove pending further information on the production capacity from the JV that is set to commence production next month.djustments to its forecasts.
