KUALA LUMPUR: Kenanga Investment Bank Bhd
maintained its "outperform" rating on Karex Bhd, setting a share target price of RM1.12 after the United States Food and Drug Administration (FDA) approved its new synthetic condoms.
In a note today, the bank said the approval significantly enhances Karex’s growth prospects, though large orders are more likely to materialise in the financial year 2026 and beyond as the product gains market traction.
The bank said the FDA approval significantly boosts Karex’s growth prospects, although substantial orders are expected to materialise in the financial year 2026 and beyond as the product gains traction.
The FDA approval came just a month after Karex received Conformité Européenne (CE) certification in Europe, a regulatory standard that verifies products are safe for sale and use in the European Economic Area.
"The FDA approval not only paves the way for Karex to tap into new markets by enabling a new distribution stream for its synthetic products, but also significantly streamlines the approval process in other countries and regions,” it said.
Kenanga noted that, having met the stringent requirements of both the FDA and CE certifications, Karex is poised to accelerate its global market penetration.
"We continue to like Karex for its leading market position and global reach in the rapidly growing condom industry, projected by industry experts at a compound annual growth rate of 8.0 to 9.0 per cent over the immediate term, and its strong research and development and product innovation," the bank added.
Kenanga Investment upheld its forecasts for Karex, citing adherence to standards, strategic shifts, post-pandemic recovery, and growing demand for innovative condoms. - Bernama
