by BLOOMBERG / pic credit: ANNUAL REPORT
SHARES of Hup Seng Industries Bhd suffered their biggest intra-day drop in 19 months following findings by Hong Kong’s consumer watchdog that cancer-causing substances were detected in biscuits and crackers including those made by the Malaysian company.
The stock slid as much as 3.9%, the most since March 2020, amid volume that was 30 times the average for this time of day. The shares traded at 87.5 sen at 3:55pm in Kuala Lumpur.
“The HKCC’s (Hong Kong Consumer Council) finding is expected to create short-term negative news flow over Hup Seng and some near-term downside bias on Hup Seng’s share price performance,” Jeff Lye Zhen Xiong, an analyst at Kuala Lumpur-based TA Securities Holdings Bhd wrote in a note on Monday.
The Hong Kong Consumer Council last week announced that 60 samples of pre-packed biscuits and crackers it tested contained cancer-inducing elements such as glycidol or acrylamide. The council also found that 40% of the products analyzed had misleading nutrition labels.
Malaysian health ministry’s food safety and quality division on Friday said that it is conducting a verification on Hup Seng’s premises. “The factory premises of (Hup Seng) hold HACCP (Hazard Analysis and Critical Control Points) and KKM (Malaysia’s health ministry) certificates,” the department said in a statement.
Hup Seng on the weekend said its cream crackers made and sold in Malaysia are fit for human consumption and are in compliance with the local food safety standards. The company in an email said it will fully cooperate with authorities on the investigation if required.
Hup Seng is one of the leading makers of crackers and biscuits in Malaysia, according to its website.