The global coronavirus pandemic has led to skyrocketing demand for personal protective equipment (PPE) including medical rubber gloves. Malaysia has been a beneficiary, as the world’s largest source of medical gloves, with a market share of about 65%.The country’s rubber glove manufacturers have seen their profits soar since the beginning of the year, with shares hitting record highs. The world’s largest rubber glove manufacturer, Top Glove Corp. and fellow-Malaysian glove giant, Hartalega Holdings Bhd., are now among the five most-valuable companies on Malaysia’s equity benchmark index, with shares leaping by more than 192% in 2020. Most of the glove majors are racing to increase capacity to meet demand from across the world.
Wong Teek Son, who co-founded Singapore-listed Riverstone Holdings Ltd. in the 1980s, recently became the fifth US-dollar billionaire in Malaysia on the back of his glove manufacturing empire, with a worth of $1.2 billion. Based on its latest annual report, the company has an annual production capacity of about 9 billion gloves. Its profit more than doubled to RMB137.5 million ($32.8 million) in the first half of the 2020.
According to a company spokesman, when Riverstone decided to go public in 2006, it picked Singapore, where funds that are raised are more easily transferable to China and Thailand, where the company is expanding. In comparison, the company’s home country, Malaysia, has stricter currency controls.
There are concerns that the boom in the rubber glove sector in Malaysia could fizzle out, leaving the country’s glove majors with excess capacity and inventory, if a vaccine or cure for coronavirus is found soon.