KUALA LUMPUR, Nov 24 — CGS-CIMB estimated that Top Glove Corporation Bhd’s (Top Glove) financial year 2021 net profit forecast (FY21F) will be negatively impacted if its manufacturing facilities in Meru, Klang does not resume full operations in two weeks.
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Yesterday, the world’s biggest rubber glove manufacturer had announced the temporary suspension of its manufacturing facilities in Klang to allow for further COVID-19 screening and quarantine of its workers following a surge in COVID-19 cases among them.
“Assuming that all 28 plants in Meru, Klang are not operational for a duration of two weeks, we estimate that the impact on our FY21F net profit forecast will be -1.9 per cent.
“Note that for every week that all 28 plants are non-operational, our FY21F net profit estimate for Top Glove will be reduced by another 0.9 per cent,” CGS-CIMB said in a research note today.
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It estimated that Top Glove’s factories in Klang, Selangor, account for an estimated 50 per cent of its total production capacity of 90 billion pieces per annum.
“Hence we keep our FY21-23F earnings per share estimates, as we await further updates on this matter,” it said.
As at 3.56 pm, Top Glove shares slipped 52 sen to RM6.83. – BERNAMA