PETALING JAYA: Bakery producer HSS Holdings Bhd, which is slated for a listing on the ACE Market of Bursa Malaysia on June 23, expects to more than double current production facility through manufacturing and automation initiatives while strengthening the company’s own-brand segment.
The company’s initial public offering (IPO) involves raising RM13.5mil through a public issue of 74 million new shares and an offer for sale of 52.5 million existing shares at 18 sen a share to raise a further RM9.4mil. Proceeds from the offer for sale would accrue to the existing shareholders.
HSS production director Joshua Lau Ern Tien said: “HSS is expanding both manufacturing facility 1 and manufacturing facility 2 with more automated production lines, funded partly through our IPO proceeds, which is expected to more than double our current production capacity.”
Lau said the company aims to improve capacity usage, which currently stand at about 70% on average, as demand continues to grow.
According to the company’s IPO prospectus, the planned upgrades to its manufacturing facilities include the installation of a new biscuit production line, enhancements to existing biscuit production lines, backend automation for selected production processes, and a new automated cake production line.
Lau said the company plans to rollout out the automation machinery initiative ahead of Dec 31, 2030, in line with incentives announced by the government in Budget 2026.
Under Budget 2026, existing companies undertaking expansion projects will be entitled to a 100% income tax exemption for five years, with the application period extended until Dec 31, 2030.
Meanwhile, Lau said HSS’ future growth strategy will hinge on leveraging digital platforms to strengthen its brand awareness, especially among younger consumers.
“With digital platforms such as TikTok, Facebook and Instagram becoming key drivers of consumer engagement, they are set to play an increasingly important role in our future brand growth strategy.
“Additionally, eCommerce is gaining strong traction among the younger generation,” Lau said.
He noted that platforms such as TikTok live streaming and Shopee storefronts present significant opportunities to strengthen customer engagement as well as widen its market base.
“These are among the initiatives we plan to accelerate following the IPO,” Lau said at a media briefing.
On evolving consumer trends in the bakery and snack segment, Lau said HSS continues to focus on products that fall within the daily essentials category, making demand relatively resilient despite economic uncertainties.
He noted that one of the company’s biggest challenges over the years has been continuously adapting product offerings to changing consumer needs and purchasing power.
“We constantly need to develop new packaging, new pricing strategies and new product mixes to cater to different consumer segments,” he said.
“In periods of higher costs due to broader geopolitical developments, consumers have become more price-sensitive, and so we need to be smart in how we position our products,” Lau explained, adding that the company will continue to expand premium product offerings.
He added that Malaysia’s multicultural festive landscape continues to support resilient demand for bakery and snack products throughout the year.
Of the IPO proceeds, RM2.6mil will go towards capital expenditure for the company’s manufacturing facilities while RM4.5mil will be used to repay bank borrowings. The company will put RM2.9mil towards working capital while the remaining RM3.5mil will be used to defray the listing expenses.
