KUALA LUMPUR: AMS Advanced Material Bhd will remain optimistic and continue to leverage its position as a semiconductor player following its listing.
Managing director Keh Teng Yang told StarBiz that last year, this segment contributed 37% to its revenue.
“We expect it to remain the largest contributor to our group this year, consistent with previous performance,” he said at the sidelines after the group’s listing on the ACE Market of Bursa Malaysia here yesterday.
Speaking to the media, Keh said Penang has seen a variety of joint investments from original equipment manufacturers (OEMs), as well as projects from Europe and some from the United States.
“We just have to tackle the current situation and watch the growth of the semiconductor industry. I do believe we’re in a sweet spot right now,” he said.
According to Keh, the current conflict in the Middle East is unlikely to impact the group’s operations as it operates mainly in the midstream segment, rather than upstream.
“We are in the semi-finished aluminium processing segment and a supplier for this space. We have not seen any issues with the supply side. I think those most likely to be impacted will be the smelting operators,” he explained.
The group is also taking a more focused approach to its expansion plans this year.
Keh said the group plans to set up a new licensed manufacturing warehouse facility in Penang, setting aside about RM8.1mil for the project.
“It will be a production plant because the one we have currently is at its capacity. At the existing plant, we have seven machines, meaning we are able to do about nine to 10 tonnes of semi-finished products over 23 working days a month. “We are looking to mirror that with the new plant,” he said.
Acknowledging that revenue is expected to increase from the new facility, Keh said he could not disclose target growth rates at this stage.
“We have seen demand for our products, which is why we have chosen to expand. If you look at our prospectus, we operate on a rental model, which means we rent, lease and operate plants,” Keh pointed out.
He added that the group is not currently in talks with other companies in the agricultural sector, as it is not permitted to enter into such contracts due to prospectus restrictions.
“Right now our focus is still supplying materials to customers, and we will network on that.
“Another segment I’m excited about is the collection and processing of scrap – we are waiting for licensing on that,” he said.
On the construction side of the group, Keh said it is becoming more selective as pricing pressures have impacted margins.
“We have a few key industries that we serve, five to be exact, so we have the ability to penetrate or choose which ones to go into.
“Looking at our first-quarter results as well as the current situation in April, I do think margins are sustainable,” he said.
On the group’s flat debut, Keh was not overly concerned, as his focus remains on growing the business.
The company debuted on Bursa Malaysia at 29 sen, with 15.91 million shares traded.
At 5pm, the stock rose 5.17%, or 1.5 sen, to 30.5 sen, with 105.83 million shares traded, making it Bursa Malaysia’s third most active counter.
