Malaysia's Glove Industry Might See Further Consolidation — Market Talk

Malaysia's glove industry might consolidate further, after major Malaysian rubber-glove manufacturer WRP Asia Pacific wound down operations amid challenging operations, MBSB Research says in a note. The closure is expected to tighten supply for products such as surgical and specialty gloves, creating opportunities for larger players to capture market share and strengthen pricing power, it says. However, if war-related supply disruptions persist for a further three to six months, glove makers might face growing liquidity pressure as weaker sales and shrinking inventories weigh on cash flow, it flags. MBSB appears cautiously positive on Malaysia's glove sector, pegging Kossan Rubber Industries and Hartalega as its top picks, given their resilience and ability to fill the supply gap. (yingxian.wong@wsj.com)