The 1QFY10 results were within expectations, mainly contributed by continuously strong demand for examination gloves, which enabled the company to not only fully pass on the cost increase to customers in a timely manner but also allowed it to command premium selling prices. Going forward, we expect demand for its examination gloves to remain firm given Adventa’s niche in surgical and dental gloves. Maintain Buy, with our target price maintained at RM5.37 based on a PER of 15x FY11 EPS - OSK.
2359 GMT [Dow Jones] Adventa (7191.KU) may rise to MYR3.46 (yesterday's intraday high) vs yesterday's close at MYR3.38 (+0.3%) says trader; this after company posts fiscal 1Q net profit to January 31 of MYR9.35 million vs MYR3.23 million year earlier; revenue rises to MYR76.8 million vs MYR68.2 million previously. Surgical gloves maker says demand for both surgical, non-sterile examination gloves "strong in all markets", increase in price of natural rubber latex not cause for concern, successfully passed on to consumer in previous quarters, "we do not see any difficulties this year in this respect as the commodity prices are well publicised," but adds, may see small change in margins in 2Q due to time lag in price increments. Trader says better results will boost shares; latex glove makers are benefiting from high demand coupled with tight supply situation; "it's not likely to change this year," trader says. (KPL)
CIMB Research maintains Outperform on Adventa - tp=RM5.44
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