Top Glove loses share value, what’s next for the firm?

KUALA LUMPUR July 15 - At the height of the pandemic, all rubber glove producers became billionaires overnight.

Companies such as Top Glove, Kossan and Hartalega shot to the top of Bursa Malaysia to become among the country's most valuable firms.

However, with the advent of the vaccines, the fortunes of these companies made a U-turn which saw their share prices crash.

Bloomberg reported earlier this week that shares of Top Glove for example, dived 90 percent to below RM1 from a high of RM8 and is not expected to rebound anytime soon.

The emergence of several medium scale rubber producers from China are expected to heat up the world's rubber gloves market as they jostle for market share.

For Top Glove Corp Berhad, what's next for the concern?

Continue to deliver the goodies

Top Glove has always been a darling among investors.

Even before the pandemic, the company has always distributed good dividends for shareholders.

Although it's share prices have crashed 90 percent in value, the company should just continue with business as usual.

The company must sustain its business as demand for rubber gloves will always be there.

Beef up R&D activities

As the world's largest rubber glove producer, Top Glove must intensify research and development activities.

The pandemic has somewhat abated and now is the perfect time and opportunity for the company to roll out new innovative products.

All around the world, some people are still allergic to latex gloves.

The company could perhaps find a solution to beat this nagging issue once and for all by rolling out the ultimate allergen-free glove.

Improve image in global standing

Top Glove is already a well-managed firm.

Take the opportunity during this relatively free time to dispel all the myths plaguing the industry such as poor treatment of foreign workers and non-compliance of international labour standards.

It is time to snuff out the issue once and for all.

Diversify into other businesses

During the pandemic, companies which are aviation or tourism centric suffered the most.

Perhaps Top Glove should diversify into other business ventures to prepare for rainy days ahead.

Top Glove executive chairman Tan Sri Dr Lim Wee-Chai has a stake in property firm LBS Bina in his personal capacity.

Perhaps Top Glove should do the same and not put all its eggs in one basket.

There will always be demand for rubber gloves

Come hell high or water, there will always be demand for rubber gloves

Rain or shine, hospitals and healthcare professional will always need rubber gloves.

Respectfully, and as cruel as this may sound, COVID-19 is not the last pandemic and there will be another disease outbreak around the corner as shown and proven by history.

So Top Glove should not be disheartened by this slight snag.

It must up the ante and continue to do what it does best, which is to supply and consolidate it's position as the world's top glove producer. - Dagangnews.com