KUALA LUMPUR (Oct 14): Glove counters were among the top gainers on Bursa Malaysia in the morning trade session today as demand for gloves continued to rise amid a surging number of Covid-19 cases.

At the time of writing, shares in Rubberex Corp (M) Bhd had risen 23% or 17 sen to RM7.57, bringing its market capitalisation to RM2.1 billion, while Careplus Group Bhd rose 4.3% or 16 sen to RM3.88.

Other top gainers included Supermax Corp Bhd and its structured warrant Supermax-C84. Supermax was up 1.18% or 12 sen to RM10.30, with a market value of RM28.02 billion. The structured warrant rose 2.61% or 12 sen to RM4.72.

As of yesterday, Malaysia’s total Covid-19 cases stood at 16,880 following an addition of 660 new cases. Globally, Covid-19 cases soared to 38.35 million with 1.09 million deaths.

According to an HLIB Research report dated Oct 8, the research house expects glove makers' earnings for financial year 2021 (FY21) to be fuelled by a continuous surge in demand for gloves, spilling over into an expected higher average selling price (ASP) on increased orders and elevated utilisation rates of above 95%.

This is because Covid-19 cases are showing no signs of slowing down, paired with no concrete vaccine timeline.

“Some channel checks showed that the lead time of glove manufacturers is now at a minimum eight months, while there are manufacturers looking at more than one year. It is noted that blended ASPs of nitrile gloves are high at between US$90 (RM373.14) and US$160 per 1,000 pieces,” it said.

Furthermore, the research house reiterated that catalysts for rubber glove growth include more stringent regulatory requirements, higher healthcare awareness, growing populations and wider glove use beyond medical, such as for food and beverages (F&B), travel, janitorial and mechanical.

“With the Covid-19 impact, projected global demand for 2020 is 330 billion gloves. Post Covid-19, we opine, the normalised global glove demand growth would be at about 13%-15%, higher than the usual 8%-10%,” it said.

HLIB reiterated its "overweight" call for rubber gloves, enhanced by pandemic-fuelled demand.