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Thursday, 1 September 2016

SCB set to win power cable job

SCB group managing director and chief executive officer Aaron Toh Chee Ching (pic) has indicated that the power cable supply contract, which is estimated to be worth between RM80mil and RM100mil, could be signed this month.

SCB group managing director and chief executive officer Aaron Toh Chee Ching (pic) has indicated that the power cable supply contract, which is estimated to be worth between RM80mil and RM100mil, could be signed this month.

KUCHING: Sarawak Cable Bhd (SCB) is set to clinch a major contract for the supply of power cables for the Pan Borneo Highway project.

The power and telecommunication cables manufacturer is also in negotiations to supply steel poles for relocated or new power transmission lines under the highway project.

In addition, the company is also eyeing the supply of road guard rails and construction jobs under the highway’s utility packages.

SCB group managing director and chief executive officer Aaron Toh Chee Ching (pic) has indicated that the power cable supply contract, which is estimated to be worth between RM80mil and RM100mil, could be signed this month.

“New power cables are needed for the relocation of existing cables affected by the widening of the existing highway, road re-alignment or construction of new stretches of road,” he told StarBiz.

The Sarawak portion of the Pan Borneo Highway spans 1,089km.

The project, which is awarded in 11 work packages,involves the construction and upgrading of 779km of single carriageway to dual carriageway, construction of many bridges and some flyovers.

The entire project is estimated to cost some RM16bil on Sarawak side and is expected to be fully completed by 2022.

Lebuhraya Borneo Utara Sdn Bhd, the project delivery partner for the Sarawak portion, has awarded most of the work packages.

Sarawak-listed companies which have secured the packages include Hock Seng Lee Bhd, Zecon Bhd, KKB Engineering Bhd, Cahya Mata Sarawak Bhd and Naim Holdings Bhd.

Most of them have set up joint venture companies with Peninsular Malaysia-based construction firms to undertake the construction work.

Toh is confident that SCB would secure contracts for the supply of steel poles for the highway project but the quantity of the poles is yet to be determined.

On the supply of guard rails, he said the company was currently in talks with some of the contractors who had won the work packages. “We are eyeing for the engineering,procurement and construction (EPC) job for two to three of the 11 highway’s utility packages comprising three components- electricity,water and telecommunication,” said Toh.

Each of the utility package is said to be worth an average of RM200mil.

SCB, which is Malaysia’s largest power cable manufacturer with an annual production capacity of 52,000 tonnes, has a current order book of more than RM600mil for both power and telecommunication cables.

“About two-thirds of the orders were secured in the past two to three months.

“Some 80% of the orders were from Malaysian companies and the balance from foreign buyers. Tenaga Nasional Bhd (TNB) and Telekom Malaysia are our major clients.

“We expect to secure more orders before year-end. We are targeting for RM1bil a year in the sales of power and telecommunication cables,” said Toh, adding that SCB had received an increasing number of orders from TNB since May.

He said the new orders provided better profit margins than those secured last year.

Toh said SCB was pushing to increase the exports of its power cables from the current 20% of total production, and had zoomed in on several new and potential markets in South-East Asia.

“Sri Lanka is a new market for medium-voltage power cables.

“We have sold some RM80mil worth of cables to that country. Indonesian market is our immediate target and we are engaging with our partner there to find ways to sell our power cables to that country as its utility body, Perusahan Listrik Negara Persero (PLN), only sources its power cables requirement from local (Indonesian) companies.

“We are also trying to break into the construction of power transmission line projects in Indonesia,” he added.

Toh said SCB group,which has been exporting power cables to traditional markets,like Singapore, Australia, New Zealand and the Middle East, had the advantage being the sole manufacturer of 275kV high-voltage underground power cables in South-East Asia.

SCB group’s manufacturing facilities and capabilities received a major boost after it acquired Leader Cable Industry Bhd and Universal Cable (M) Bhd.

Tags / Keywords: Earnings , Stocks , Corporate News , Investing , Sarawak Cable , power

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