SGX Market Updates

Medical Suppliers See a Surge in Trading as Markets React to Omicron Variant


PUBLISHED ON |

29 November 2021

  • The STI has declined 3.1% over the past two sessions. Globally, Airline, Hospitality and Bank stocks were among the most adversely impacted by the reports of the Omicron variant and ensuing uncertainty on vaccine efficacy and containment measures. At the same time, globally, Pharmaceutical, Healthcare Services and Healthcare Products have been the most defensive sectors.

  • In Singapore, Riverstone, Top Glove, Medtecs International and UG Healthcare have averaged 48% gains over the past 2 sessions, with a surge in trading turnover. Today, the 4 stocks saw close to S$170mil in shares changing hands, more than doubling Friday’s S$77mil, and significantly higher than the combined average daily $20mil turnover for the 2021 year, prior to 26 Nov.

  • Medtecs International led the 4 stocks over the 2 sessions. The stock rallied from S$0.037 at the end of 2019 to S$1.00 at the end of 2020, and had declined to S$0.29 on 25 Nov, before rallying to S$0.40 on 26 Nov, and closing at S$0.50 on 29 Nov. On 22 Nov, Medtecs International reported 9MFY21 revenue of US$115M, down from US$287mil in 9MFY20, and up from US$50mil in 9MFY19.

  • Raffles Medical and Q&M Dental also averaged 4% gains over the past 2 sessions. Both companies have supported the Singapore Government’s COVID-19 initiatives, with Raffles Medical operating dedicated PCR centres while Q&M Dental’s Acumen Diagnostics focuses on the manufacture and distribution of COVID-19 diagnostic test kits, as well as COVID19 testing.




The uncertainty of the Omicron variant on vaccine efficacy and global containment measures has seen a sharp adjustment to the recent gains of stock sectors, industries and valuations since Thursday. In the Singapore stock market, the Straits Times Index (“STI”) has declined 3.1% from 3,221.52 on Thu 25 Nov, to 3,120.58 on Mon 29 Nov, while the Hang Seng Index has declined 3.6% and the FTSE ASEAN All-Share Index has declined 2.8%. This has seen the STI return to levels last traded on 11 October, with the year to date total return trimmed to 13.2%.

DBS Group, OCBC Bank and United Overseas Bank have averaged a decline of 3.8% over the two sessions, with global banks declining 3.1%. During the 2 sessions, Singapore Airlines, CapitaLand Integrated Commercial Trust, Genting Singapore, ComfortDelGro and Thai Beverage led the STI decliners, averaging 5.0% declines.

Outside the STI, and among the 100 most actives for the year, Far East Hospitality Trust, CDL Hospitality Trust and Ascott Residence Trust averaged 6.0% declines over the 2 sessions. At the same time, the sharp decline in energy prices, with emerging variants a key downside risk, saw Rex International, Geo Energy Resources and RH Petrogas average 4.3% declines. These moves have followed the moves of global stocks that have seen Airlines, Hospitality and Bank stocks seeing the biggest declines since 25 Nov, while Pharmaceutical, Healthcare Services and Healthcare Products have been the most defensive.

Likewise, among Singapore’s 100 most active stocks for 2021, 6 of the most defensive performers of the past two sessions represented the Healthcare Sector. As tabled below, Medtecs International, UG Healthcare, Top Glove and Riverstone comprised 4 of the 5 strongest most actively traded stocks over the past two sessions. Today, the four stocks saw close to S$170 million in shares changing hands, more than doubling Friday’s S$77 million, and significantly higher than the combined average daily $20 million turnover for the 2021 year, prior to 26 Nov, and their average daily combined turnover of S$40 million in 2020.


Strongest Performers since 25Nov21 among the 100 most actively traded stocks in 2021 SGX
Code
Price
S$
Total Return % Sector
On 29Nov21 Since 25Nov21 Since 30Sep21 Since 31Dec20 Year 2020
Medtecs International 546 0.500 25.0 72.4 29.9 -47.1 2627.8 Healthcare
UG Healthcare 8K7 0.425 30.8 66.7 25.4 -25.9 1156.6 Healthcare
Top Glove BVA 1.040 24.6 43.4 16.6 -42.1 300.3 Healthcare
Totm Technologies 42F 0.200 11.7 21.2 -21.6 108.3 -5.0 Telecommunications
Riverstone AP4 0.765 7.7 10.9 -14.0 -25.7 142.9 Healthcare
Q&M Dental QC7 0.645 4.9 6.6 18.2 80.9 3.4 Healthcare
CFM 5EB 0.148 -2.0 3.5 -19.6 270.0 207.7 Industrials
Raffles Medical BSL 1.410 1.4 2.2 -3.4 44.3 2.5 Healthcare
Yanlord Land Z25 1.120 1.8 1.8 0.9 5.3 -2.3 Real Estate (excl. REITs)
Leader Environmental LS9 0.073 1.4 1.4 -6.4 1.5 498.3 Industrials
Sheng Siong OV8 1.490 1.4 1.4 0.7 0.0 28.9 Consumer Non-Cyclicals

Source: SGX, Bloomberg, Refinitiv (Data as of 29 Nov, 5:15pm)



Prior to Friday, the 4 stocks had generated median declines of approximately 60% in the 2021 year through to Nov 25, following median total returns of 720% in 2020.

Catalist-listed Medtecs International ended the 29 Nov session at S$0.50 per share, up from S$0.29 per share on Thu 25 Nov. In 2020, the share price rallied S$0.037 at the end of 2019 to S$1.00 at the end of 2020. Medtecs International noted last week in a 3QFY21 (ended 30 Sep) Business Update, demand for personal protective equipment ("PPE") had declined recently due to completion of stock-piling exercises by its customers in 2020 and subsequent inventory adjustments, and the stabilisation of the supply and prices of the PPE market globally. The last two years had seen its revenues for the first nine months of the year swing from US$50M in 9MFY19, to US$287M in 9MFY20, to US$115M in 9MFY21.

Top Glove Corporation is the largest medical supplier listed in Singapore by market value. The secondary listing is also the globe’s largest manufacturer of gloves and has reported steady growth with a compound annual growth rate of 27% for revenue and 36% for profit after tax over the past 20 years, and as the Chairman reiterated on 11 Nov, glove demand was already growing steadily pre pandemic at a rate of 10% per annum and is likely to stabilise at a higher level even after the pandemic recedes owing to elevated awareness and hygiene levels. While ranking outside the most traded 100 stocks this year, Aspen Group has also rallied 19.1% over the past 2 sessions. In addition to its Development of residential and commercial property business, Aspen Group has a healthcare Manufacturing of gloves segment, with its commercial production of gloves under its Phase 1(a) commencing on 10 May and its first shipment of gloves shipped out on 29 May.

Also among the 5 most defensive stocks for the past two sessions was Catalist-listed Totm Technologies. Formerly Yinda Infocom, the company has undergone a strategic rebranding following its acquisition of a 51% stake of Singapore based International Biometrics Pte Ltd, which is a Singapore-incorporated software company that provides integrated identity management platform solutions for mega-scale end-to-end projects. With Totm Technologies’ focus on Identity Management Solutions, especially in the space of Digital On-boarding and Digital ID, the company maintains in the post-COVID-19 scenario, the global digital identity solutions market size is projected to double from US$23 billion in 2021 to US$50 billion by 2026.

Raffles Medical and Q&M Dental also ranked among the most defensive stocks over the past two sessions.

Raffles Medical Group noted in July that adapting to the ever-changing nature of the pandemic, it has expanded its operations beyond air-border screening and pre-event testing to include vaccination centres, pre-departure swabbing of cruise passengers, as well as operating dedicated polymerase chain reaction (“PCR”) testing centres to conduct tests for those exposed to new COVID-19 clusters as they emerge.

Q&M Dental also reiterated in November, that in 2020, the Group expanded into the medical laboratories and research industry with the incorporation of Acumen Diagnostics Pte. Ltd. (“Acumen Diagnostics”). Acumen Diagnostics currently focuses on the manufacture, sale and distribution of COVID-19 diagnostic test kits, as well as COVID19 testing.

The 10 least performing stocks of the 100 most traded Singapore stocks in 2021, over the past two sessions are tabled below.

Least Performers since 25Nov21 among the 100 most actively traded stocks in 2021 SGX
Code
Price
S$
Total Return % Sector
On 29Nov21 Since 25Nov21 Since 30Sep21 Since 31Dec20 Year 2020
SIA C6L 4.910 -2.8 -6.5 -2.4 14.7 -32.8 Industrials
Far East Hospitality Trust Q5T 0.585 -3.3 -6.4 -5.6 -1.6 -13.2 REITs
First REIT AW9U 0.295 -1.7 -6.3 18.6 51.5 -74.6 REITs
ISDN I07 0.695 0.0 -6.1 11.2 73.4 79.4 Technology (Hardware/ Software)
CDL Hospitality Trusts J85 1.130 -3.4 -5.8 8.7 -7.6 -17.8 REITs
Ascott Residence Trust HMN 1.000 -2.0 -5.7 8.1 -3.2 -17.8 REITs
Rex International 5WH 0.270 0.0 -5.3 28.6 84.9 -28.8 Energy/ Oil & Gas
Geo Energy Resources RE4 0.275 0.0 -5.2 10.0 78.7 29.6 Energy/ Oil & Gas
CapitaLand Integrated Commercial Trust C38U 2.140 -2.3 -4.9 5.4 2.3 -7.9 REITs
Genting Singapore G13 0.790 -0.6 -4.8 9.7 -6.0 -4.7 Consumer Cyclicals

Source: SGX, Bloomberg, Refinitiv (Data as of 29 Nov, 5:15pm)







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