Amid nerves over swine flu, some firms see cash cow | world | Hindustan Times
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Amid nerves over swine flu, some firms see cash cow

world Updated: Apr 28, 2009 16:57 IST
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The swine flu outbreak is rattling nerves around the world but some companies, like the makers of face masks and rubber gloves, are turning those jitters into a bonanza.

Long queues formed at chemists across Hong Kong, with customers waiting to buy the surgical masks widely used in every health scare here since SARS in 2003, while manufacturers said they could not ship more until mid-May.

"We ordered 1,000 more face masks yesterday and 1,000 more today to cope with the surge in demand," said Rene Chow, a manager at the city's FM Dispensary. "But the stock was gone within hours."

Troubled times always bring opportunities, and savvy business minds across Asia have been looking for a chance to turn panic into profit.

Investors in Malaysia have sent shares in rubber glove makers soaring.

Top Glove gained almost 12 percent on the Malaysian stock exchange on Monday, while Latexx gained 8.8 per cent -- before rising another 8.1 percent on Tuesday.

"People are buying glove companies because they feel that these companies will benefit from the possible pandemic as was the case in the bird flu outbreak in 2003," one dealer at a Malaysian brokerage said.

Australian company Rockeby Biomed, which makes a "rapid test" for the type-A influenza that can cause swine flu, saw its shares jump 78 percent on Tuesday alone. Similar shares also did well.

There was "serious conviction in the buying," said Chris Weston, an analyst with IG Markets. "The ones who are tiered to the viral situation -- obviously they have had a huge rally," he said.

Vaccine maker CSL hadn't responded "too amazingly" to the news, but Weston said it was experiencing a speculative bounce, up 3.8 per cent.

Biota, which licenses Relenza, one of the main anti-viral drugs recommended by the US Centers for Disease Control and Prevention, was down 3.2 percent as investors took profits after its shares rose almost 80 percent Monday.
Weston called it a "fantastic rally."

Investors have also been pouring their money into pharmaceutical firms in mainland China, and analysts said the jumps were solely due to belief the companies would prosper from the swine flu crisis.

China Animal Husbandry Industry, a company that makes animal health-care products, was up more than five percent on Tuesday after jumping by its 10 percent daily limit in the previous session.

Inner Mongolia Jinyu Group, a medicines firm, also rose by the 10 per cent limit on Monday and was up more than four percent again on Tuesday.

In Hong Kong, the swine flu scare was even turning out to be alright for an unexpected sector -- pork butchers.
Pork is the staple meat for Chinese, and there was no sign that business was slowing down amid the crisis.

"There is too much we can't eat these days," housewife Heather Wong said, referring to other scares in recent years over the safety of chicken and beef.

"What will be left for us to eat? In the worst-scenario, we'd have to go vegetarian," Wong said.
And then she bought a large bag of pork ribs to cook for dinner.