Singapore’s Big Winner of the Week: UG Healthcare Corporation Ltd

This week’s big winner in Singapore’s market is UG Healthcare Corporation Ltd (SGX: 41A), which gained 28.6% during the week to end Friday at S$0.315. This easily triumphs the 1.6% decline that the Straits Times Index (SGX: ^STI) had experienced over the same duration.

UG Healthcare, which got listed in December last year, is a Malaysia-based glove manufacturer. It manufactures “natural latex and nitrile examination gloves, as well as distribute ancillary products such as surgical, vinyl and cleanroom gloves, face masks, and other medical disposables.”

One of UG Healthcare’s competitors in the gloves market is Singapore-listed and Malaysia-based Riverstone Holdings Limited (SGX: AP4).

For the six months ended 31 December 2014 (1H FY2015), UG Healthcare’s revenue declined by 3.5% year-on-year to S$25.1 million. This was on the back of a reduction in the average selling price of its products that was partially offset by a slight increase in production volume.

The revenue dip flowed down to the bottom-line:  UG Healthcare’s net profit dropped by 17% from S$2.9 million in 1H FY2014 to S$2.4 million.

Going forward, UG Healthcare said that the upcoming 12 months is going to “remain challenging due to competition among major gloves producers.”

However, as set out in its initial public offering prospectus, the company will still forge ahead and look into 1) expanding its production capacity and sales and distribution network, 2) developing new products and engaging in research and development, and 3) expand its business through mergers and acquisitions.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.