Weekly | Why Top Glove Lead the Market this Week？

As of the close on Friday, $Straits Times Index(STI.SI)$ closed at 3,208.55 points, down 1.78% points last week. The earnings calendar is attached at the end of the article.

During the last 5 trading days, $TOP GLOVE CORPORATION BHD(BVA.SI)$, $GOLDEN AGRI-RESOURCES LTD(E5H.SI)$, $SHANGRI-LA ASIA LIMITED(S07.SI)$, $SIA ENGINEERING CO LTD(S59.SI)$ and $BUMITAMA AGRI LTD.(P8Z.SI)$ are the top 5 Weekly gainers, up 8.47%, 5.88%, 5.22%, 4.95% and 4.39% respectively.

$VENTURE CORPORATION LIMITED(V03.SI)$, $THAI BEVERAGE PUBLIC CO LTD(Y92.SI)$, $YZJ Fin Hldg(YF8.SI)$, $AEM HOLDINGS LTD(AWX.SI)$ and $DFIRG USD(D01.SI)$ are top 5 decliners of SGX stocks which market capital above S$1 Bln.

Below are key analyses of the TOP 5 gainers:

1. $TOP GLOVE CORPORATION BHD(BVA.SI)$

The pandemic may seem like a distant memory now, but it had the effect of boosting the fortunes of several sectors such as technology, rubber gloves, and personal protective equipment.

Top Glove released its fiscal 2023’s second quarter (2Q FY2023) earnings for the period ending 28 February 2023. The glove maker saw its revenue plunge by 58.2% year on year from RM 1.48 billion to RM 618 million.

Operating expenses, however, fell by just 43.1% year on year to RM 785.8 million. Revenue dipped by 2% qoq from RM 633 million in 1Q FY2023 while net loss was 2% lower qoq.

The good news is that sales volume grew 6% qoq as customers showed signs of replenishing their inventories.

2. $GOLDEN AGRI-RESOURCES LTD(E5H.SI)$

A look at the shareholders of Golden Agri-Resources Ltd (SGX:E5H) can tell us which group is most powerful. With 51% stake, private companies possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Hedge funds don't have many shares in Golden Agri-Resources. Looking at our data, we can see that the largest shareholder is PT Sinar Mas Group with 51% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. In comparison, the second and third largest shareholders hold about 11% and 4.9% of the stock.

3. $SHANGRI-LA ASIA LIMITED(S07.SI)$

Shangri-La Asia Ltd. engages in the ownership and operation of hotels and associated properties and the provision of hotel management and related services.

The firm operates through the following segments: Hotel Properties, Hotel Management and Related Services, Investment Properties, and Property Development for Sale.

4. $SIA ENGINEERING CO LTD(S59.SI)$

A question to answer is whether SIA Engineering's current trading price of S$2.29 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy?

SIA Engineering’s share price is quite stable, which could mean two things: firstly, it may take the share price a while to fall back down to an attractive buying range, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

5. $BUMITAMA AGRI LTD.(P8Z.SI)$

Even if it's not a huge purchase, we think it was good to see that Hung Siang Lim, the Lead Independent Director of Bumitama Agri Ltd. It recently shelled out S$65k to buy stock, at S$0.64 per share. Even though that isn't a massive buy, it did increase their holding by 200%, which is arguably a good sign.

Notably, that recent purchase by Hung Siang Lim is the biggest insider purchase of Bumitama Agri shares that we've seen in the last year. So it's clear an insider wanted to buy, even at a higher price than the current share price (being S$0.64). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future.

The SG earnings for May: