CIMB Research expects a subdued three-year core net profit compound annual growth rate of around 3% over financial year ended March 31, 2025 (FY25) to FY28.
PETALING JAYA: QL Resources Bhd
is aiming for long-term growth as it plans a major expansion of its food manufacturing capacity to meet rising demand and broaden its product range.
According to CIMB Research, the move signals a forward-looking push to scale up operations and improve efficiency even as near-term conditions remain challenging.
The expansion centred on a large, multi-year development that would reshape the group’s manufacturing base, said the research house.
The group’s QL Innofood Park is expected to unlock 2.5 times capacity growth with efficiency upside.
“Upon completion, QL Innofood Park is expected to deliver a step-change in scale, with annual production capacity reaching 180,000 tonnes,” the research house said.
“This represents an increase of 130,000 tonnes, or 2.5 times QL Resources’ current capacity of 50,000 tonnes, materially enhancing its ability to meet rising demand,” it added.
Recent media report highlighted that QL Resources planned to expand the production capacity of its marine products manufacturing segment through the RM1.3bil QL Innofood Park project, which will be undertaken via its wholly owned subsidiary, QL Foods Sdn Bhd.
Located in Bagan Datuk, Perak, the site is planned as a new regional food manufacturing hub.
It is intended to support the group’s move beyond surimi into higher value-added protein-based foods, including soy, flour, poultry and other processed products, strengthening its position to capture long-term domestic and export demand growth.
The project will be rolled out under a 10-year phased development plan starting this year.
It will comprise 13 production plants along with supporting infrastructure.
Capital expenditure is estimated at RM300mil for initial infrastructure works, followed by about RM100mil per year for plant construction during the build-out period.
On operations, CIMB Research said: “The facilities will be Industry 4.0-ready, incorporating automated storage and retrieval systems, centralised cold rooms, smart warehouses, and data-driven monitoring systems.”
These features are expected to lift efficiency, improve supply chain integration and support future expansion, it noted.
Despite the strategic scale of the project, the research house remained cautious about earnings in the near term.
CIMB Research maintained its “hold” rating on QL Resources with an unchanged target price of RM4.60, based on a valuation of 33.9 times one-year forward price-to-earnings ratio.
It expected a subdued three-year core net profit compound annual growth rate of around 3% over financial year ended March 31, 2025 (FY25) to FY28, reflecting softer demand and ongoing cost pressures.
“While we are positive on the project’s strategic merits, earnings contribution from QL Innofood Park is expected to be back-end loaded, with meaningful financial impact materialising only in the later phases of the multi-year development,” CIMB Research cautioned.
