JOHOR BAHRU (Apr 30): SCGM, which recently attracted institutional investor interest, is planning to build a new factory worth RM4 million to boost the company’s annual revenue by RM20 million.

In an interview with theedgemalaysia.com, company Chairman Datuk Lee Hock Seng said the new two-storey factory will house new production equipment for plastics cups.

“This project will begin in November 2014 and will contribute more than RM20 million to the company at full capacity,” he said.

He added that the company is expected to achieve its revenue target of RM100 million for the FY2014.

Lee said that his company was looking to further its reach into India.

SCGM currently owns businesses worldwide in North America, Oceania, Europe and Asia.

“We’ll keep on moving worldwide… We’ve already moved into India but we’re going to move further in because India is a very huge country,” he said.

The plastic packaging manufacturer had reported a net profit of RM3.28 million in its third financial quarter ended January 31, 2014, up from RM1.38 million a year ago. Revenue for the third quarter came in lower at RM24.74 million, from RM25.85 million a year ago.

The Johor-based SCGM currently commands 60%-70% market share of the plastic food packaging industry.

“I dare to say that about 60%-70% of market share belongs to Lee Soon Seng Plastics Industries (LSSPI) Sdn Bhd” said Lee. LSSPI is wholly owned by SCGM.

Lee, chairman of SCGM since 2007, is one of the founders of LSSPI. He is also the chairman of LSSPI.

He is presently responsible for the strategic business development and direction of this group of companies.  

As SCGM share is now on the radar of institutional investors, Lee said he is prepared to sell the company if a “fair and right” price is offered.

He said: “I am already 63. I don’t wish to work forever.”

Last week, theedgemalaysia.com reported that institutional investors had bought into the company and this had caused SCGM share to hit record highs.

Last Monday, the stock saw a 19% jump to a record high of RM1.45

Lee declined to reveal who the new investors are, but said that the institution will continue to invest in the company due to SCGM’s strong performance.

“I believe they will be continuing their investments because our company's performance is good. I don’t think many companies can grow this consistently every year.”

On whether he intends to diversify the business, Lee said that he would continue in the plastics business as it is the company’s core area of expertise.

“We would focus on diversifying in areas related to plastics. It’s our area of expertise. We’ll be taking on a lot of risk if we invest in something we don’t fully understand,” he said.