KUALA LUMPUR (Aug 04): Rubber stocks continued their Friday rally on news that glove makers would benefit from the Ebola outbreak.
At 10:31 am, Top Glove led the rally rising 11 sen or 2.31% to RM4.88 per share with some 800,000 shares traded.
Supermax and Hartalega rose as well with the former rising 10 sen or 4.66% to RM2.46 and the latter rising 4 sen or 0.75% to RM6.70.
Commenting on the stock rise, analyst Jerry Lee of RHB Research told theedgemalaysia.com that Top Glove stands to be the biggest beneficiary of the Ebola outbreak.
“The ebola outbreak could see Top Glove increasing its current utilization rate to 80-85% from 70-75% should it develop into a pandemic,” said Lee.
This further support comments by analyst Soong Wei Siang of JF Apex Securities in The Edge Financial Daily today that Top Glove stands to benefit the most because of its biggest capacity among the 3 listed glove makers.
Quoting the Malaysian Glove Makers’ Association (MARGMA), The Edge Financial Daily reported that glove makers would stand to benefit from the recent outbreak of the Ebola virus in West Africa as fear for the virus spreading will fan greater demand for medical gloves in not only the affected countries but those who are likely to be affected.
“Any extraordinary demand for gloves will be good for the industry… The glove industry is already enjoying good normal demand and any extraordinary demand will only mean less bargaining and a slightly higher utilisation of the production lines,” said Margma president Lim Kwee Shyan.
Last Friday, World Health Organization director-general Dr Margaret Chan said in a speech that the outbreak is developing faster than the organization’s efforts to control it.
“This outbreak is moving faster than our efforts to control it. If the situation continues to deteriorate, the consequences can be catastrophic in terms of lost lives but also severe socioeconomic disruption and a high risk of spread to other countries,” Chan was quoted as saying.
The director-general has convened an emergency committee meeting on Aug 6 to assess the international implications of West Africa’s outbreak.
– theedgemalaysia.com
