Vaccine-related plays get shot in the arm

AS pharmaceutical companies make major breakthroughs recently in the hunt for a Covid-19 vaccine, investors are turning their attention to stocks seen as part of the storage and distribution chain for when a viable vaccine comes to Malaysian shores.

Needless to say, the share prices of total logistics solutions providers, such as Tiong Nam Logistics Holdings Bhd and Tasco Bhd, which are equipped with cold-chain capabilities, have been driven up further by investors in the last few weeks, likely owing to the vaccine news.

While there seems to be keen interest in the vaccine play, market experts believe much of it is still speculative at this point.

“For now, we believe that the share price surge, driven by Covid-19 vaccine distribution news, is most likely speculative. There have been no directives from the government or those logistics companies’ healthcare clients yet on this matter,” says MIDF Research head of research Imran Yusof.

On Nov 9, news broke that Pfizer Inc and BioNTech SE’s Covid-19 vaccine showed evidence of being more than 90% effective. A week later, Moderna Inc announced that preliminary analysis of its Covid-19 vaccine trial indicated 94.5% effectiveness.

Last week, Malaysia inked an agreement with China to cooperate on the development of a safe and efficacious Covid-19 vaccine. The agreement will give it priority access to coronavirus vaccines developed by China.