UNIMPRESSED with the extent of health hazards from the Human Metapneumovirus (HPMV) outbreak in China, MIDF Research has reiterated its “neutral” stance on Malaysia’s glove sector.
The research house further justified that China’s Union Health Ministry has at the current juncture surmised that the outbreak is an annual occurrence during winter and that it is safe to travel to China.
“Premised on this, we view that the seasonal influenza cases would not lead to a surge in glove demand inside and outside of China,” commented analyst Martin Foo Chuan Loong in a glove sector update.
“Nonetheless, should it become prevalent in China, we opine that it would not benefit the local glove manufacturers as China’s glove companies would have the necessary capacities to supply to the country.”
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MIDF Research also pointed to the fact that the news on the potential HPMV outbreak “coincidentally took place with the commencement of steep increase in tariff for China-made gloves to the US from 2025 onwards”.
“We have neutral recommendations across all glove manufacturers under our coverage as the run-up in share price since September 2024 has led to stretched valuation,” noted the research house.
“Nonetheless, should there be uptick in share driven by sentiment, we view that it would represent a good opportunity to take profit.”
Recall that the US has raised its tariff against China-made medical gloves from 7.5% in 2024 to 50% in 2025 and 100% in 2026.
As it is, China is reportedly experiencing a surge in infections of the respiratory virus. This comes five years after the advent of the COVID-19 pandemic which emerged in Wuhan, China.
Nonetheless, the country’s Union Health Ministry mentioned that there had not been substantial increase in the number of HPMV cases in December 2024.
Premised on the data, influenza is leading the outbreak with 30.2% tested positive. Comparatively, HPMV is only linked to 6.2% of the respiratory illness tests.
“Since the virus has been circulating for some time, it seems that there is more herd immunity against it as compared to a novel virus such the COVID-19 at the beginning of the pandemic,” opined MIDF Research.
Editor’s Note: There is no specific treatment nor vaccine available for it at this juncture. Locally in China, some 327 cases of HMPV were detected in 2024, an increase of +45.3% year-on-year (yoy).
At the close of today’s (Jan 6) mid-day trading, all the Big Four glove makers posted an uptrend, led by Hartalega Holdings Bhd (up 7 sen or 1.81% to RM3.94); Kossan Rubber Industries Bhd (up 7 sen or 2.52% to RM2.85), Top Glove Corp Bhd (up 4 sen or 3.01% to RM1.37) and Supermax Corp Bhd (up 3 sen or 2.36% to RM1.30). – Jan 6, 2025
