COCOA-DERIVED food ingredient maker Guan Chong Bhd, en route to a listing on Bursa Malaysia main board on April 8, is to increase its cocoa bean processing capacity, chief executive officer Brandon Tay Hoe Lian said.
Annual capacity would be raised to 60,000 tonnes by the end of the year from the present 52,000 tonnes as demand for cocoa-derived products was likely to remain buoyant in the coming years, he said.
Tay said there were not many cocoa-derived food makers in the world to cater for the three million tonnes of cocoa grindings required by chocolate-making companies yearly.
This is a very niche industry and only those with the technical know-how can enter the market, he told reporters during a tour to the company's plant yesterday.
Tay said while production cost was the main criteria for other industries, it was not really the main factor for cocoa-derived food makers.
If costs were a factor, producers from the low-cost countries in the region would have the advantage over Malaysian producers, he said.
Quality comes first. Only producers who consistently make high-quality cocoa ingredients will survive in the industry.
Tay said Guan Chong prided itself as one of the leading manufacturers in the region providing high-quality cocoa-derived food ingredients to the international market.
The group has three subsidiaries involved in producing cocoa-derived food ingredients, procuring cocoa beans and producing blended cocoa-derived ingredients.
Tay said the company exported 94% of its products to more than 20 countries, with the main destinations being the Netherlands, Singapore and the United States.
He said the company planned to open a marketing office in New York and had appointed agents in Russia and Eastern Europe this year.
Europe and the US remain the main chocolate centres of the world as most of the chocolate and related products are made there, he added.
The company aims to raise RM38.5mil from the initial public offer, of which RM20.8mil will be used to finance its expansion, RM13.7mil for working capital and RM1mil for the acquisition of equipment for research and development.
Another RM1.4mil will be used to repay bank borrowings and RM1.5mil for listing expenses.
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