Wednesday, February 02, 2011

Rubber glove sector- a glimmer of hope?

Today, we learned that Latexx is disposing off its entire business to Navis Asia for RM852 million or RM3.10 per share (go here). Is Navis Asia the same company which had earlier expressed interest in buying up the business of Adventa (go here)? It was reported that the party interested in buying up Adventa's business had earlier approached Topglov with the same motive. The interest shown by this unknown party & the successful deal between Navis Asia & Latexx could be a sign that the rubber glove sector has hit a bottom.

From Chart 1- to 3 below, we can see Latexx & Adventa have broken above their downtrend line while Harta is still pressing against its all-time high.


Chart 1: Latexx's daily chart as at Feb 2, 2011_9.30am (Source: Quickcharts)



Chart 2: Adventa's daily chart as at Feb 2, 2011_9.30am (Source: Quickcharts)



Chart 3: Harta's daily chart as at Feb 2, 2011_9.30am (Source: Quickcharts)

However, the same bullishness seems not to have touched the share price of Kossan & Topglov. This may present a buying opportunity for investors with longer time horizon to slowly nibble into this sector. Who knows when the price of rubber latex & the cross rate of USD & RM may move favorably for this sector?


Chart 4: Kossan's daily chart as at Feb 2, 2011_9.30am (Source: Quickcharts)



Chart 5: Topglov's daily chart as at Feb 2, 2011_9.30am (Source: Quickcharts)

Good entry level to Kossan & Topglov is at RM2.90-3.00 & RM4.80-5.00, respectively.
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5 comments:

  1. jamesWednesday, February 02, 2011 11:12:00 AM

    Hi Alex,

    Wishing you and your loved ones a rabbit year leaping with abundance, sound health and success in all your undertakings.

    Best regards,
    James

    ReplyDelete
  2. tanWednesday, February 02, 2011 11:21:00 AM

    hi alex,
    is mphb a good entry point at current price, it has breakout form previous high last year april,with the relisting news of magnum could it be the catalyst for this uptrend?. as per your previous posting it may trade up to the PE of 12x at above rm3.00.

    happy CNY !

    ReplyDelete
  3. newbieWednesday, February 02, 2011 12:18:00 PM

    Happy new year,Alex.May the year of the rabbit enable all to hop to greater heights!!

    ReplyDelete
  4. steveFriday, February 04, 2011 4:12:00 AM

    What is a good entry point for supermax? Thanks!

    ReplyDelete
  5. Alex LuFriday, February 11, 2011 10:04:00 AM

    Hi steve

    Supermax's good entry is at the gradual uptrend line support of RM4.10.

    ReplyDelete