Glovemakers soar on H1N1 threat

Glovemakers soar on H1N1 threat

Tags: Kossan Supermax Top Glove

Written by Surin Murugiah
Tuesday, 11 August 2009 01:05

KUALA LUMPUR: The increasingly deadly outbreak of the influenza A (H1N1) virus threat sent the stocks of rubber glove manufacturers soaring on Aug 10, with some hitting their 52-week high.

With the death toll from the H1N1-related disease in Malaysia having reached 32 yesterday, demand for rubber gloves and masks have been increasing.

Inter-Pacific Research Sdn Bhd head of research Anthony Dass said he did not see any softening in the demand for rubber gloves and surgical masks at the moment.

“The strong demand due to the virus outbreak will continue to push the stock prices. This would translate into potentially good earnings for the companies,” he said.

Last week, OSK Equity Research in a report had said it remained overweight on the rubber gloves sector, and that the demand for gloves from the medical industry was strong, especially from developing countries.

It said that since the H1N1 outbreak has been raised to pandemic level, the governments of developed countries like US and Europe have urged all healthcare MNCs to stock up on rubber gloves, which has created short-term demand.

“Over the longer term, demand is expected to come from developing countries like China, India and Russia, which are gradually increasing their use of gloves.”

“Also, with US tightening Food and Drug Administration (FDA) regulations effective December 2008, the number of glove defects per batch would need to be reduced to qualify for entry to the US market,” it said.

This would reduce the supply of rubber glove exports to US due to the retention of “unqualified” gloves at the ports and hence creating new sales opportunities for the established rubber glove manufacturers, said the research house.

On Aug 10, the shares of ADVENTA BHD [ ADVENTA 2.090 -0.020 (-0.948%) ] rose almost 22% or 38 sen to close at its 52-week high of RM2.11, while RUBBEREX CORPORATION (M) BHD [ RUBEREX 1.930 -0.070 (-3.500%) ] added 15.6% or 27 sen to RM2.

SUPERMAX CORPORATION BHD [ SUPERMX 2.980 -0.050 (-1.650%) ] gained 10.99% or 30 sen to RM3.03, KOSSAN RUBBER INDUSTRIES BHD [ KOSSAN 4.110 -0.040 (-0.964%) ] up 4.3% or 17 sen to RM4.51 while LATEXX PARTNERS BHD [ LATEXX 2.230 0.060 (2.765%)
] rose 10.1% or 20 sen to RM2.17.

Supermax was among the most actively traded stocks yesterday with 11.6 million shares done, while Latexx saw some 10.4 million of its shares traded.

Meanwhile, TOP GLOVE CORPORATION BHD [ TOPGLOV 7.300 0.020 (0.275%)] gained seven sen to RM7.28.

HARTALEGA HOLDINGS BHD [ HARTA 5.260 -0.030 (-0.567%)], however, fell six sen to RM5.29.

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