EPF dumps 43.5m shares in top 4 glove companies

Large chunk of it is Top Glove’s shares amounting to 17m, leaving EPF with 6.23% of direct shares left


THE Employees Provident Fund (EPF) had disposed of some 43.47 million of shares in the country’s top four glove companies within the past month.

According to filings on Bursa Malaysia, a large chunk of the total shares dumped by EPF were in Top Glove Corp Bhd which totalled to about 17.01 million.

As at last Friday, EPF was left with 6.23% or 498.82 million direct shares in the glove company.

In the past month, the biggest disposal of shares that took place was worth about 6.3 million which was on Sept 22, 2021. On the same date, the fund also acquired 5.28 million shares.

As at last Friday, Top Glove’s share price stood at RM2.76. Year-to-date (YTD), its share price RM2.74 or 49.82%. It has a market capitalisation of RM22.65 billion.

The fund also sold approximately 15.41 million shares in Hartalega Holdings Bhd in the last one month.

EPF currently has 8.11% or 277.91 million of direct interest in Hartalega.

The largest amount of shares it dumped during that period was around 2.8 million which was done in two tranches on Sept 17, 2021.

Hartalega’s share price stood at RM6.02 at the closing bell on last Friday. YTD, its shares have slipped RM4.46 or 42.56%. It is now valued at RM20.63 billion in the market.

As for Kossan Rubber Industries Bhd, the EPF disposed of approximately 7.86 million in the last one month.

The fund is now left with 8.53% or 217.68 million of direct interest in the glove company. It dumped about 2.35 million shares on Sept 17 which was the largest amount disposed of within that period.

As at last Friday, Kossan’s share price stood at RM2.44. YTD, its shares have dropped RM1.50 or 38.07%. The glove company now has a market capitalisation of RM6.24 billion.

The EPF also disposed of 3.19 million shares in Supermax Corp Bhd where it now has 34.74 million of direct units.

Supermax’s share price stood at RM2.17 as at last Friday. YTD, its shares dropped RM3.34 or 60.62% and it is now valued at RM5.9 billion.

According to a research note by Maybank Investment Bank Bhd (Maybank IB) recently, local glovemakers are expected to see a weaker average selling price (ASP) of rubber gloves.

Its analyst Wong Wei Sum said the ASP of rubber gloves are expected to return to preCovid-19 level given that the ASP had been weak since the second quarter of 2021 (2Q21).

Wong said Kossan’s ASP is expected to decline 8% to 10% month-on-month and could return to pre-Covid levels of US$23 per k pcs to US$24 (RM99.60) per k pcs by mid2022, representing a 42% decline from the current level.

Separately in another report, Wong said Hartalega’s ASP is expected to drop 30% between 1Q22 and 2Q22 and may only normalise in early 2022, returning to pre-Covid levels by mid-2022.

In a report last month, Hong Leong Investment Bank also foresees a slowdown in the glovemakers’ ASP which will lead to a decline in their earnings by up to 58%.

Its analyst Chan Jit Hoong said this would be mainly due to the ramp up of vaccination rollout in key markets.