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After PPE foray, Mango brand retailer

Jerasia looks to raise RM261m for
glove business
Emir Zainul / theedgemarkets.com

January 29, 2021 23:20 pm +08

KUALA LUMPUR (Jan 29): Apparel manufacturer and fashion retailer Jerasia
Capital Bhd plans to raise up to RM261.3 million by way of a rights issue with
free warrants, as part of its efforts to venture into glove manufacturing.  

Jerasia, which operates Mango retail outlets in Malaysia, said it plans to install
up to 10 glove dipping lines in stages over the course of 12 months to
manufacture latex and nitrile gloves. These 10 lines are expected to yield a
production capacity of 8.4 million pieces of gloves per day. 

The estimated capital expenditure required to construct and commission all 10

glove dipping lines, as well as its related facilities, is RM146.0 million, the
group said in a statement today.
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Part of the plan includes acquiring a three-acre freehold land in Negeri

Sembilan, in which it aims to construct a double-story factory consisting of an
office, warehouse, laboratory and production space. 

Jerasia group managing director Pronob Sen Gupta said the expansion is
synergistic for the group, which had last year expanded its product portfolio
into producing personal protection equipment (PPE).

"Since the outbreak of the Covid-19 pandemic, the demand for PPE to curb the
pandemic has boosted the demand for gloves. On the other hand, our
wholesaling, retailing and manufacturing and exporting of fashion apparels
and accessories had been affected by the movement control order (MCO). 

“The glove business venture will allow us to take advantage of favourable

long-term prospects of the glove industry and capitalise on the burgeoning
demand for gloves, while making the most out of the opportunities created by
the Covid-19 pandemic," he said.  

With the corporate exercise, the group will enter into a conditional offtake
agreement with Golden Global Trading & Healthcare Sdn Bhd for the supply of
gloves.  

Under the offtake agreement, Jerasia said it will supply a minimum 72 million
boxes of latex and nitrile examination gloves within three years, with a
monthly minimum volume commitment of two million boxes throughout the
three years period. 
Subject to the completion of the factory, the first glove dipping lines is
expected to be commissioned by the second half of 2021. 

Shares of Jerasia today fell 2.5 sen or 5.38% to close at 44 sen, with a market
capitalisation of RM 36.10 million. 

Edited by S Kanagaraju
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