KUALA LUMPUR (Sept 25): Boilermech Holdings Bhd intends to expand its manufacturing capacity by 20% via a new RM60 million manufacturing plant in Klang, which will start construction by year-end.

The bigger manufacturing capacity would enable the biomass boiler manufacturer to achieve production of 10 boilers per month from the current eight, said Boilermech executive director of Chia Lik Khai.

He added that operations at the new plant are expected to start in mid-2016.

"Today, we just passed the resolution to acquire the 22-acre industrial land in Pulau Indah, Klang. This will be the new manufacturing base that we can expand on," he said after the conclusion of Boilermech's AGM and EGM today.

Noting that the industrial land is 'quite sizeable', Chia said the manufacturing plant would be constructed in phases and not “built in one shot”.

"We expect other business activities to occupy us too," he explained.

Chia said the group expects to incur RM30 million for the land acquisition and infrastructure development, with an additional RM30 million for the plant, equipment and necessary machinery.

Presently, Boilermech only has one manufacturing plant in Perindustrian Subang, Selangor, which has hit full manufacturing capacity.

In addition, Chia noted Boilermech's order book is still “'strong” as it is in excess of RM300 million.

As at 2pm, Boilermech has slipped 1 sen to RM3.47, with 69,700 shares changing hands.