Rubber processor Seng Fong set to bump up annual capacity

RUBBER processor Seng Fong Holdings Bhd, which saw its net profit for its second quarter ended Dec 31 (2Q24) more than doubled to RM17.4 million on the back of RM287.6 million in turnover, is set to increase its production capability.

In an exchange filing today, the Muar-based company said it has increased production hours, up to 18 hours a day from 12 hours earlier, in all its three factories by adding a second working shift.

The move will enable it to increase its total annual capacity to approximately 190,000 metric tonnes (MTs) in financial year 2024 (FY24) compared to approximately 166,000MTs in FY23.

It said it was getting increasing demand from the China and India markets which were the largest world consumers of natural rubber driven by the growth of their automotive industries.

It added that the installation of the biomass system to generate gas from wood chips as a fuel source for its dryer system was aimed towards cost-saving by replacing the consumption of diesel.

However, it said some further fine-tuning was required by the vendor after the commissioning.

In separate filings, Seng Fong announced a proposed private placement of up to 51.9 million new ordinary shares, representing up to 10% of the total number of its issued shares as well as bonus issue of up to 190.3 million shares on the basis of one bonus share for every three existing shares.

Seng Fong’s shares closed today at 77 sen today, just one sen below its 52-week high of 78 sen, giving it a market capitalisation of RM400 million. Its 52-week low was 67 sen. — TMR