KUALA LUMPUR (July 28): PublicInvest Research expects Hartalega Holdings Bhd (KL:HARTA) to benefit from higher glove prices due to Middle East tensions, but the upside may be limited as customers remain cautious and suppliers have diversified their sources.

The research house upgraded Hartalega to 'neutral' from 'underperform' after the recent share price decline, saying the stock is now closer to its target price of 98 sen, with a more balanced risk-reward outlook.

PublicInvest expects Hartalega’s first quarter ended June 30, 2026 results, due on Aug 4, to benefit from stronger glove prices in May and June, maintaining its earnings forecasts for the financial year ending March 31, 2027 (FY2027)-FY2029.

PublicInvest said price gains may be limited as customers are taking a wait-and-see approach, while competition from cheaper Chinese manufacturers has kept glove prices under pressure.

It said Hartalega’s plant reactivation and technology upgrades could improve efficiency and reduce costs by up to 10%, with its third plant expected to resume operations by December. The company is currently operating at 85% capacity.

Among 19 analysts tracked by Bloomberg, most maintain 'hold' or 'sell' calls, with only three recommending a 'buy'. The average target price stands at RM1.31, above PublicInvest’s target of 98 sen.

Hartalega’s shares were unchanged at 97 sen a share at noon break on Tuesday, valuing the company at RM3.3 billion. Year to date, the stock is down 2%.