Shares of three glove makers plunge on Russian vaccine news
UG Healthcare, Top Glove and Riverstone tumble after news of first vaccine approval
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A production line at a Top Glove factory in Selangor in February. Malaysia-based Top Glove, the world's largest glove manufacturer, closed at $8.19 yesterday, down 9.3 per cent with 2.8 million shares traded. It had rallied to a peak last Thursday when it closed at $9.30, up about 38.9 per cent from a month earlier.
PHOTO: BLOOMBERG
News that Russia will roll out a Covid-19 vaccine sent the shares of three Singapore-listed glove manufacturers plunging yesterday.
The sell-off wiped out the considerable gains the shares had racked up over recent weeks.
The trigger was Russia's announcement on Tuesday night that it has approved the world's first vaccine against the coronavirus although clinical trials will continue.
Its announcement appeared to weigh on sentiment for glove plays, as an effective vaccine could curb the spread of Covid-19 and dampen demand for gloves.
Mainboard-listed Riverstone Holdings sank 12.7 per cent to $3.99 within the first hour of the market opening before recovering a little to close down 9.4 per cent at $4.14.
About 12 million shares changed hands, making it the third most active stock by value on the bourse.
Its share spiked to a record high of $4.69 last Friday, two days after Riverstone announced that its half-year earnings had more than doubled. The Malaysian company specialises in gloves for clean rooms and healthcare.
Malaysia-based Top Glove, the world's largest glove manufacturer, plunged 12.8 per cent early on but recovered slightly to close at $8.19, down 9.3 per cent with 2.8 million shares traded.
The mainboard-listed stock had rallied to a peak last Thursday when it closed at $9.30, up about 38.9 per cent from a month earlier.
Top Glove said on Monday that it expects to pay about RM53 million (S$17.3 million) in remediation fees to migrant workers it employed before it implemented a new standard for ethical recruitment.
Disposable glove manufacturer UG Healthcare's stellar financial results released on Tuesday were not enough to prop up its shares.
The Catalist board counter rapidly retreated 18.5 per cent early in the session before closing at $2.98, a fall of 11.6 per cent with 10.5 million shares traded. Similar to its peers, UG Healthcare had enjoyed a bullish run over the past several weeks, jumping to $3.37 on Tuesday before announcing full-year results.
Earnings for the second half ended June 30 hit $12.6 million, markedly higher than the $1.2 million recorded a year earlier.
Revenue surged 80.9 per cent, boosted by the higher volume and selling prices of gloves.
Full-year net profit was $13.4 million compared with $2.5 million in the previous year, while revenue grew 57.2 per cent to $144.2 million.
Yesterday's share price falls of the glove firms were in stark contrast to healthcare company Medtecs International.
The Catalist-listed stock rocketed 44.6 per cent to $1.41 with a remarkable 150.5 million shares traded after posting a robust set of financial results on Tuesday night.
THE BUSINESS TIMES
