KUALA LUMPUR: Baby, children and maternity product retailer Kim Hin Joo (M) Bhd is looking to diversify into the toy sector with an ambitious plan to open up to four The Entertainer toy outlets in Malaysia in the next three years.
The Entertainer UK, which was founded in 1981, is a privately owned company that runs a chain of toy shops in the United Kingdom with a total of 148 stores.
Kim Hin Joo chairman Pang Kim Hin said the company plans to open up the first outlet of The Entertainer in the first quarter of 2020 in the Klang Valley, pending approval from the franchise authority of Malaysia.
“We hope the approval can be given in the next three months so we can get started,” he told StarBiz on the sidelines of the company’s listing on the Ace Market.
With regard to baby toys, the company sold less than 1% of baby toys out of RM637.07mil imported toys in 2018 in Malaysia.
“It is a blue ocean for us to diversify into the toy sector. Even if we were to capture 10% of the market, we would be able to double the company’s turnover,” he said.
The company also plans to expand The Entertainer toy outlets in Singapore in the next three years.
Apart from the brick-and-mortar toy stores, Pang said the company would also have a multi-pronged strategy to sell the toys, adding that it would be through its website and distribution channel which would have a “far deeper reach” to consumers.
Currently, it has around 635 distribution points, where it distributes home, baby and travel products to local and overseas retailers.
Kim Hin Joo is expected to double its customers from its diversification into the toy sector as it would cater to children aged six to 12. Currently, Kim Hin Joo’s business activity allows it to cater to retail products for kids up to the age of six via its Mothercare outlets and early learning centre (ELC) stores.
To date, Kim Hin Joo has 17 Mothercare outlets and 11 ELC stores. The company sells a total of 184 brands of clothing, home and travel products, and toys.
It also plans to open up to five new Mothercare outlets in Malaysia within three years of listing on the Ace Market.
Yesterday, Kim Hin Joo made a cautious debut on the Ace Market, opening at 39 sen with 3.59 million shares being done, four sen below its offer price of 43 sen.
Given the lower opening price, Pang said his main focus was to deliver performance for the company, citing its increasing profitability in the last four years.
“The most important thing is to look forward to the performance of the company. The share price and value of the company would increase once investors see our performance. I will make sure that consistent profitability is delivered in financial year 2019 (FY19),” he said during the press conference.
Kim Hin Joo’s net profit had steadily increased to RM11.11mil in FY18 from RM8.2mil in FY15.