CORRECTED-UPDATE 1-Malaysia's Top Glove shares tumble after govt says factories to be shut

24 Nov 2020 / 11:10 H.

    (Corrects gender of speaker in paragraph 4 and 5)

    KUALA LUMPUR, Nov 24 (Reuters) - Shares in Malaysia's Top Glove slumped 7.5% on Tuesday, after the government said some of its factories would be closed in stages for COVID-19 screening and quarantine, as more than 2,000 of its workers tested positive for the disease.

    The Health Ministry reported a sharp rise in cases in the area where Top Glove factories and dormitories are located, with 2,453 workers testing positive for the virus, out of 5,767 screened.

    The government said 28 factory buildings will be shut in phases but did not provide a timetable.

    This new development has not affected the company's orders, MIDF Research analyst Ng Bei Shan said in a note, adding she was maintaining her earnings estimates for fiscal 2021.

    "The development of the temporary closure of its facilities in stages is still fluid. As such, the actual impact to Top Glove's full-year earnings may be hard to ascertain at this point," she said.

    In a stock exchange filing on Monday, Top Glove said it had temporarily stopped production at 16 facilities since last Wednesday, with the balance of 12 facilities operating at much reduced capacities.

    The world's largest maker of latex gloves has racked up record profits this year on sky-rocketing demand for its products and protective gear, thanks to the pandemic.

    Last week, the government ordered 14-day curbs through Nov. 30 in parts of a district about 40 kms (24.8 miles) west of the capital Kuala Lumpur, where Top Glove factories and dormitories are located. (Reporting by Liz Lee; Editing by Tom Hogue and Neil Fullick)

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