“It seems that further increases in ASP may not be feasible at this point as Top Glove is facing strong resistance from its customers. On a positive note, the company expects demand to pick up significantly in 4Q2023 once destocking activities are over,” Wong adds.
Maybank Securities analyst Wong Wei Sum has maintained “sell” on Top Glove Corp (SGX:BVA
) with a target price of 57 sen, expecting the glove maker’s 3QFY2023 ended May earnings to remain in the red.
While Top Glove has managed to raise its average selling price (ASP) to US$21 per thousand pieces, this has had an impact on both sales volume and plant utilisation rate — especially amid an oversupplied market condition, says Wong. Top Glove’s plant utilisation rate currently stands at about 20% based on 100 billion capacity.
