KLANG: Property developer Mah Sing Group Bhd is aiming to be among the Top 5 glove producers in Malaysia in the medium term.
“At the moment, we are looking to close more deals with tier-one and tier-two customers for long-term contracts.
“With the demand remaining strong, this may not be a difficult task for us.
“We hope to be in the Top 5 within the next couple of years, ” Mah Sing founder and group managing director Tan Sri Leong Hoy Kum told a press conference after a media tour of the glove factory here yesterday.
The 228,800 sq ft glove factory is on five acres in Kapar, near Setia Alam.
It anticipates demand for gloves to remain strong and has currently secured sales up to September 2021 with average selling prices (ASP) ranging from US$85 (RM349) to US$115 per 1,000 gloves.
“Within the industry, everyone is saying that the ASP would be adjusted lower but this would all depend on the pandemic situation, ” said Mah Sing’s executive director Datuk Steven Ng.
“Our production costs based on current raw material prices are US$36 to US$40 per 1,000 gloves. These are before taxes are calculated, ” Ng added.
Mah Sing also has a plastics division.
While the main contributor to its earnings and revenue is the property division, “the sky is the limit” for its newest glove venture, according to Leong.
“It would all depend on the demand moving forward.
“If we can secure long-term contracts, I’m sure we would expand further.
“With the ongoing demand, the indicative orders have exceeded the entire capacity for 2021, ” Leong said.
“For now, gloves will be the smallest contributor, ” Ng said without discounting that the division might grow more than initially anticipated.
In the longer term, the company is aiming to list its glove or healthcare division within five years.
“We are aiming to list on the Hong Kong Stock Exchange. This is because the market capitalisation of companies in Hong Kong is almost 15 times more than Malaysia.
“While trading volumes there are more than 20 times, ” Ng said.
“Listing there would also ease business contacts so that we can consider more mergers and acquisitions as it is an international market, ” he added.
With the factory, Mah Sing is targeting to sell to customers from the United States, Europe, China, Canada, the Middle East and Japan.
As of yesterday, Mah Sing had successfully completed the testing and commissioning of its first two glove production lines in Kapar.
The company said it is on track to see four more production lines to be operational in the second quarter followed by six more production lines in the third quarter.
The 12 double former lines are under its first phase manufacturing plans, which are capable of producing 38,000 pieces of gloves per hour per line with a maximum capacity of up to 3.68 billion pieces of gloves per year.
Mah Sing said in its statement that it could expand in an eventual phase two plan by exercising the option for the next portion of the existing plant, or negotiate with the landowner on an adjacent land.
This could accommodate another 12 new production lines and increase the capacity by up to an additional 3.68 billion pieces of gloves per annum, the company said.
The factory is modern and would incorporate highly automated processes which will reduce the reliance on labour.
It has also installed thick oven panels to insulate the heat released during the production of gloves to safeguard factory personnel from unnecessary work risk.
The company said air-conditioners will also be installed at the layering and packaging areas of the factory when all the lines are completed in the future as an enhanced hygiene measure to create a dust proof environment and ensure the quality of gloves produced.
“Starting from scratch allows us to put best practices in place from the get-go. Our high speed production lines are equipped with auto strip, auto stack and auto count features as well as auto dosing of solutions for higher efficiency, ” CEO Datuk Ho Hon Sang said.
“There are also plans for auto-boxing and the factory will also be ready to adopt the IR 4.0 ecosystem to improve our efficiencies and competitiveness, ” he added.
Mah Sing Healthcare Sdn Bhd’s general manager Lawrence Khoo said the factory incorporates a water treatment facility and scrubbing systems that helps to cater to necessary environmental, social, and governance requirements.
“We are continuing to monitor such discharges (waste) so we can comply with the department of environment’s and the other regulations (by the government), ” he said.