THE COVID-19 virus is dubbed ‘invisible enemy’ for a reason. Nobody wins once it strikes.
For that reason, employers especially those in a labour-intensive working environment must never ever let their guard down or to put in more bluntly, stinge on the welfare of its workforce.
Ensuring proper accommodation with ample space for social distancing and hygiene may seem a costly investment but at the end of the day, this could prove to be a better investment than to encounter disruption from their employees been ruled invalid by becoming part of the country’s ever rising COVID-19 statistic.
Indeed the COVID-19 virus is industry-blind.
Electrical and electronic giant Panasonic Manufacturing Malaysia Bhd has joined its glove sector counterparts by becoming the latest casualty after 116 or circa 5% of its 2,137-strong workforce (45 local and 71 foreign) were tested positive for COVID-19.
The screening was conducted on Dec 19 as part of a precautionary measure following rising cases across manufacturing facilities in Malaysia.
This has prompted the group to close both its factories in Seksyen 15 and Seksyen 23 Shah Alam for three days (Dec 21-23) to allow full disinfection of its facilities, including the foreign workers’ accommodation.
As revealed by Hong Leong Investment Bank (HLIB) Research in its latest company update, the management shared that the COVID-19 infection is widespread across all production department and the group is currently in discussion with Health Ministry on the appropriate timing to resume production.
While the management should be credited for being transparent, the group’s operation will be impacted in the short term due to production suspension.
“We opine that the group may need to increase number of shifts/overtime, thus incurring higher production cost in order to fulfil the demand moving forward,” projected analyst Syifaa’ Mahsuri Ismail. “Furthermore, the group estimated the cost of sanitisation works would be approximately RM35,000.”
As a consequence of the COVID-19 issue, HLIB Research has lowered Panasonic Malaysia’s target price marginally to RM28.17 (previously RM28.40) to reflect its slashing of the company’s FY2021 earnings by -2% to take into account the short-term plants closure and higher operational cost.
“Despite the uncertainties, we reckon Panasonic Malaysia can weather through this storm supported by its balance sheet strength,” added the research house.
At 9.55am, Panasonic Malaysia was down 56 sen or 1.8% to RM30.62 with 2,500 shares traded, thus valuing the company at RM1.86 bil. – Dec 22, 2020
