Chin Hin Group Bhd group managing director Chiau Haw Choon showing one of his autoclaved aerated concrete product in his factory in Bukit Beruntung, Selangor.
KUALA LUMPUR: Chin Hin Group Bhd
has acquired Mi Polymer Concrete Pipes Sdn Bhd for RM35mil.
The move effectively positions the group as the first integrated sewage specialist in South-East Asia, with the ability to provide a full range of solutions.
Managing director Chiau Haw Choon said as an integrated building materials provider, the group manufactured a number of products for the sewage business solution.
“However, we noticed a gap in our product range, as we do not have pipes smaller than 450 millimeters, and this prevented us from becoming a one-stop supplier.
“This acquisition provides the missing link, effectively positioning us as the first integrated sewerage specialist in Southeast Asia,” he told reporters at the signing ceremony on the acquisition in Kuala Lumpur on Monday.
Given the current urbanisation trend, he said the region’s public capital expenditure for sanitation might reach up to US$12.4bil (RM54.9bil), which provided a great potential for the industry to tap into.
He added that the region’s population was projected to grow from about 633 million in 2015 to 733 million in 2030, thus intensifying the need for sewage pipes.
On the local front, Chiau said the Malaysian government had allocated RM9bil under the National Sewerage Project, out of which RM510mil had been earmarked for this year.
He said this became the group’s immediate target, leveraging on its geographical proximity.
Further to the acquisition, Chiau said Mi Polymer had made a profit guarantee of RM6mil to the group this year and the would contribute positively to group earnings.
He said Mi Polymer was in midst of constructing its second factory costing RM2mil, which was expected to be completed by the end of this year.
The new factory will double the company’s production capacity to 44,000 tonnes.
Currently, Chin Hin’s orderbook stands at about RM300mil, including RM10mil from Mi Polymer, which would last the group for three years.
Chiau said the group had grown rapidly, achieving revenue exceeding RM1bil in the past six years, while net profit had doubled to RM44mil in 2016 from the previous year.
He added that the group aimed to maintain its double-digit growth in profit this year, on the back of its two core business segments - sewerage business and infrastrusture.
Moving forward, the group plans to tap into regional markets and participate in sewerage infrastructure tenders in Indonesia, the Philippines and Myanmar. - Bernama
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