PETALING JAYA: Top Glove Corp Bhd is the best-performing constituent of the iEdge SG All Healthcare Index, with a 41.4% return on a year-to-date basis.
According to a recent SGX market update report, the index’s best performers since the beginning of the year comprised SGX’s three rubber glove plays, Top Glove Corp, Riverstone Holdings and UG Healthcare Corp, which have a combined market capitalisation of more than S$5bil (RM15.25bil).
The iEdge SG All Healthcare Index is a free-float, market capitalisation-weighted index that measures the performance of Singapore’s listed healthcare sector.
“As rubber gloves are indispensable in medical procedures and for hygiene purposes, the global rubber glove industry is poised to benefit from rising regional healthcare spending and patient demand.
“Singapore’s healthcare sector is typically viewed as a defensive segment, poised to enjoy multi-year growth prospects.
“Drivers of Asia’s increased healthcare spending levels include accelerated ageing rates, the rise of lifestyle diseases like diabetes and hypertension, as well as growing disposable incomes,” said SGX.
To meet growing global demand for gloves, Top Glove will continue to pursue strategic expansion.
It is currently expanding capacity across its facilities, which is estimated to give the group a total of 746 production lines and an output of 69.1 billion gloves per annum by 2020.
Top Glove is also looking to expand in Vietnam, and has entered into an agreement to buy a land site for its factory, which is scheduled to start operations in the next two years.
In support of this ambitious growth agenda, the group will continue to explore inorganic expansion via mergers and acquisitions, as well as new set-ups in related industries.
Top Glove, the world’s largest manufacturer of gloves, is primary-listed on Bursa Malaysia, with a secondary listing on SGX. Year-to-date, the five best-performing constituents of the iEdge SG All Healthcare Index are Top Glove (+41.4%), Camsing Healthcare (+19.5%), Haw Par Corp (+12.2%), UG Healthcare Corp (+5.7%) and Riverstone Holdings (+5.1%).
These five healthcare plays have averaged a total return of +16.8% in the year thus far, bringing their three-year and five-year total returns to 5.8% and 102.2%, respectively.
The iEdge SG All Healthcare Index, which comprises 31 constituents, has generated a total return of -2.4% year-to-date, compared with total returns of -6.2% and -6.7% for the benchmark Straits Times Index and the broader FTSE All-Share Index, respectively.
Between July and October 2018, the healthcare sector saw four consecutive months of net inflows by institutional investors; S$8.1mil (RM24.7mil) in July, S$2.7mil (RM8.23mil) in August and S$10.1mil (RM30.8mil) in September, followed by S$4.3mil (RM13.11mil) in October, according to SGX data.
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