Kossan Rubber's Earnings Outlook May Be Supported Despite Cost Pressures — Market Talk

Kossan Rubber Industries' 2026 earnings outlook may be supported by disciplined cost control, a strong balance sheet and higher-value product expansion, Public Investment Bank analyst Hailey Chung says in a note. Near-term earnings are expected to benefit from stronger average selling prices amid Middle East-driven raw material volatility, particularly in 2Q, she says. However, she cautions that structural cost pressures could intensify in 2H due to higher feedstock costs. Kossan's focus on automation upgrades and expanding its higher-margin cleanroom glove segment could help cushion margin pressures over the medium term, she adds. Public IB cuts Kossan's target price to 1.36 ringgit from 1.50 ringgit, while maintaining an outperform rating on the stock. Shares are 5.8% higher at 1.28 ringgit. (yingxian.wong@wsj.com)