Coronavirus Outbreak Turbo-Charge The Demand For Sanitiser Gel Products

Over the past few months, the ongoing Covid-19 outbreak has wreaked havoc on human life and global trade. According to World Health Organisation (WHO), 2,034,802 people have been found infected with the contagious virus out of which 135,163 died across 213 countries as on 17 April 2020.

Till date, prevention has been the only way to contain the spread of this contagious virus. Mainly the deadly virus spreads from human to human in form of droplets, and attacks the respiratory system in the human body eventually causing death in some cases. Therefore, the people are advised by the government, time and again, to observe social distancing and avoid mass gatherings. In addition, use of face masks and protective gear was encouraged by the government. Another prevention technique which is regularly emphasised is to maintain personal hygiene. Major supermarkets across the world saw panic buying of cleaning and hygiene products with almost stockouts in most of the shopping arcades. Demand for hand sanitiser, hand wash, air pollution masks and other hygiene, personal care and home care products have grown manifolds post the outbreak of the global pandemic. The disinfectants are considered as a prevention method against the deadly virus which can help in containing the spread of the contagious disease.

Most of the companies around the world are coming forward and doing their bit in order to fight against the coronavirus crisis. Here, we shall discuss performances of some prominent stocks in the hygiene and personal care domain.

Pz Cussons PLC (LON:PZC)

A British cosmetics and soap maker, PZ Cussons reported a significant surge in demand for its Carex hand wash, soap and sanitisers during the third quarter ended 29 February 2020. The growth was primarily driven by the rise in health and hygiene concerns among people in a bid contain the epidemic coronavirus. However, the company continues to face challenges in sourcing packaging and raw materials to meet the growing demand. The company saw growth in brand revenue in the third quarter 2020, which was driven by Carex, Morning Fresh and Cussons Baby.

PZ Cussons further confirmed its prudent financial position with a strong balance sheet. However, the company has reportedly not been doing well in its portfolio of beauty products due to closure of hair salons amid coronavirus-induced lockdown.

The company informed that manufacturing sites would remain open across all regions, with employees demonstrating huge commitment to ensure that the production targets of hygiene products are met. The company ensured safe and secure conditions to the people working in its manufacturing units in this period of unprecedented crisis.

Company Overview: PZ Cussons PLC (LON:PZC) is a consumer products company. The company is known for its innovation and has introduced some well renowned brands to the world, which include Imperial Leather, Cussons Baby, Morning Fresh and St. Tropez. The company’s operations are divided into four categories being Home Care, Personal Care & Beauty, Electricals, and Food & Nutrition. The shares of the company trade on the London Stock Exchange in the main market segment. The shares trade there with the ticker name PZC and form part of the FTSE 250 index.

Stock price performance: PZ Cussons PLC shares last traded at GBX 176.80, up 0.38 percent or GBX 0.60 as at 17 April 2020. Stock's 52 weeks High and Low is GBX 229.62 /GBX 149.00. PZC stock closed 18.66 percent above the 52-week low on Friday. Along with an annual dividend yield of 4.70 percent, the beta of the company stood at 0.48, reflecting lower volatility as compared to the benchmark index. The total market capitalisation of the company stood at £757.99 million as at 17 April 2020.

Reckitt Benckiser Group PLC (LON:RB)

United Kingdom’s Hygiene and Personal care products are in the money to make a difference in the world while putting up a fight against the novel coronavirus. Globally renowned top-rated hygiene and personal care products which includes popular household brands like Dettol, Harpic, Lysol, and many others come from the house of Reckitt Benckiser Group Plc. The company recently declared an annual dividend of 174.6 pence for the fiscal year 2019, which was more than the prior year’s dividend of 170.7 pence. Due to stable performance in the company’s hygiene business, the fiscal year 2019 was broadly in line with the expectations for net revenue growth and adjusted operating profit, as per the report.

The company expects to witness growth in its revenue on a like-for-like basis in the fiscal year 2020 as compared to the fiscal year 2019. The company has already witnessed increased demand for cleaning products and are working closely to support the healthcare systems and authorities in the need of this hour. However, it is too early to assess the impact of the pandemic outbreak on the business performance of the company, report read.

Company Overview: Reckitt Benckiser Group Plc (RB) is into manufacturing and marketing of the household, toiletry, and health care products. The company has a spectrum of products consisting of air fresheners, laundry products, dishwashing detergents, disinfectant sprays, water softeners, household cleaners, and personal care products. The company also manufactures over the counter (OTC) drugs, cough and congestion tablets, sinus relief products, gastric liquids, hair removal and pest control products. The company has a strong brand image in the market under the names such as Durex, Nurofen, Strepsils, Mucinex, Dettol, Lysol, Veet, Harpic, Mortein, Finish and Vanish.

Stock price performance: On 17 April 2020, RB stock price closed at GBX 6,248, down 0.51 percent or GBX 32.00 in a day trading session. Stock's 52 weeks High and Low is GBX 6,744.00/GBX 5,130.00. The stock prices last trade at 7.35 percent lower than its 52-week High. Along with an annual dividend yield of 2.78 percent, the beta of the company stood at 0.45, reflecting lower volatility as compared to the benchmark index. The total market capitalisation of the company stood at £44.36 billion.

Stock price Comparative Chart as on April 17 before the market close (Source: Thomson Reuters)

Beer Manufacturers Step Up To Produce Hand Sanitisers

Few weeks ago, a brewer BrewDog reportedly commenced the manufacturing of hand sanitisers at its distillery in the United Kingdom to cope up with the shortages driven by the novel coronavirus.

Another beer manufacturer, Labatt also started production of hand sanitisers from its production lines in various cities across the world, last month. The beer giant pledged to produce 50,000 bottles of hand sanitizers to cope up with the surging demand amid the deadly pandemic outbreak.

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