CIMB Research ups Latexx Partners (7064.KU) target to MYR5.44 from MYR4.36 based on unchanged 30% discount to rival Top Glove's (7113.KU) target market PE of 16.5x; this, after raising house FY10-11 earnings for Latexx by 23-25% after getting updates on company's expansion plans; keeps Outperform call, which is premised on the potential re-rating catalysts of the company's move towards higher-margin premium products, latest JV agreement produce, market and distribute protein-free natural rubber gloves.
In Latexx, it is teaming up with Amsterdam-based Budev BV to market and distribute protein-free gloves. The JV company would treat natural rubber latex examination and surgical gloves using Budev's TECHNOLOGY [].
The proposed JV would enable Latexx to venture into a new era of technology to treat natural rubber latex examination and surgical gloves with extremely reduced levels of proteins and allergens to non-detectable level to prevent users from having an allergic reaction.
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