THE patience of investors of Bursa Malaysia’s Big-Four glove makers has really been tested to the limit in recent times. The share prices of their prized possession has hit rock bottom without any clue or hint of rebounding.
Top Glove Corp Bhd is officially reduced to penny stock today after declining 4 sen or 3.96% at the time of writing to 97 sen with 66.63 million shares traded which gave the counter a market capitalisation of RM7.96 bil.
The world’s largest glove maker is not alone in such quandary. Amid consistent dumping of its stock by the Employees Provident Fund (EPF), Hartalega Holdings Bhd has hit a 52-week low or probably a pre-pandemic level of RM2.87 before firming a little to RM2.88 but still down 10 sen or 3.36% to RM2.88 with 6.54 million shares traded (market cap: RM9.87 bil).
Kossan Rubber Industries Bhd seems to be the strongest of the lot thus far, judging by its ability to withstand the storm. The counter was unchanged at RM1.33 with 2.76 million shares traded, thus valuing the glove maker at RM3.4 bil.
Joining Top Glove as penny stock is Supermax Corp Bhd, whose share price retreated 3 sen or 3.3 % to 88 sen with 11.6 million shares exchanged hands (market cap: RM2.39 bil).
For Supermax, this can be a double whammy as news has surfaced that Norway’s US$1.2 tril wealth fund has on yesterday (June 15) put the glove maker under observation for two years, citing unacceptable risk that the company contributes to serious violations of human rights.
The fund added it has also revoked the exclusion of Malaysia’s IJM Corp Bhd and decided to end its active ownership for South Africa’s AngloGold Ashanti Ltd.
IJM Corp was excluded in 2015 due to its activities in palm oil plants in Indonesia, and since these activities have been terminated, there are no longer grounds for exclusion, according to the fund.
Given massive uncertainties that lie ahead with regard to demand for gloves as the world is gradually transitioning to an endemic phase in addition to diminishing average selling prices (ASP) and steep competition from China, prospects of the Big-Four glove counters are undoubtedly bleak at this juncture. – June 16, 2022
