Chin Hin banks on infrastructure division

Posted on 05 August 2019

Source: The Star Online

Chin Hin Group Bhd, a building materials supplier, is expecting its infrastructure division to drive its business this year despite the housing segment remaining subdued.

“In our precast segment, we are supplying for the double-tracking project in Johor. We supply a lot of beams, including for the ongoing mass rapid transit and light rail transit projects and the Duke Highway. We are also looking to supply precast products for the East Coast Rail Link project, which is also used for its earthworks, ” group managing director Chiau Haw Choon told StarBiz recently. 

“We are now riding on the momentum from infrastructure demand. We hope that we will have a slight improvement from last year’s (results). Generally today, most of the building material suppliers are making losses such as steel and cement mills. We are also challenged but due to some of the strategic businesses we are in, we are able to do relatively well, ” he added.

Apart from its precast business segment, the company also sells Starken Autoclaved Aerated Concrete (AAC), a more advanced building material compared to clay or cement-type bricks.

Chiau said the company spent some RM160mil in capital expenditure to import the machinery from Germany to manufacture Starken AAC.

“We have two plants: one in Bukit Beruntung and another in Kota Tinggi, Johor.

“For the Bukit Beruntung plant, we are already running at full capacity, while for Kota Tinggi, the capacity is running at 30% because we just started this year. For the whole company, our capacity has increased by some 50% (since the Kota Tinggi plant opening), ” Chiau said.

Chiau also hopes that with the expected additional demand coming from the Philippines, the group’s Kota Tinggi plant can achieve a targeted capacity utilisation of at least 60% by the end of the year.

“We hope that within the next 12 months, the Philippines market would be able to contribute some 30%-40% of the Kota Tinggi plant’s capacity.

“We are very confident of doing well in the Philippines market, as it would help to shorten the building process there compared to the usual methods they use to build, ” he said.

He noted that the longer-term plan is to build another Starken AAC factory in the Philippines.

The company’s Kota Tinggi Starken AAC plant has a 600, 000m3 installed capacity.

Other than the Philippines, Chin Hin said in its annual report that it is also aiming to expand its market reach for Starken AAC in Singapore.

Meanwhile, its 45% associate company Atlantic Blue Sdn Bhd, which is an engineering, procurement, construction and commissioning contractor for solar power plants, is also expected to tap on the growth of the renewable energy industry in Malaysia.

Atlantic Blue is also seeking a listing on the Ace Market, which has been approved in-principle by the Securities Commission, subject to the registration of its prospectus with the regulator.Atlantic Blue currently has three large-scale solar (LSS under the LSS2) projects in hand with a total value of RM158.07mil for the deployment of solar farms in Perak that will be completed by year-end.

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