KUALA LUMPUR (June 8): Car leather upholstery maker Pecca Group Bhd plans to invest a further RM5 million to expand its mask-making capacity due to increasing market demand.

The expansion will be managed by its wholly-owned subsidiary Pecca Leather Sdn Bhd and involve the purchasing of five new mask production lines amounting to RM3 million. The remaining RM2 million will be used for building renovations.

Pecca group managing director Datuk Kelvin Teoh Hwa Cheng said in a statement today as the Covid-19 pandemic increases in severity in Malaysia, the expansion will help the firm better serve increasing demand for high-quality face masks among the medical, corporate and retail segments.

“Through the latest expansion,we aim to introduce a greater variety of advanced face masks models, such as the KF94, KN95, and N95 duckbill, as well as launch more premium and fashionable face mask offerings to cater to all lifestyle needs,” he said.

Teoh also stated that he sees the group moving towards a dual-core business model in the future, driven by both the automotive leather and healthcare segments.

Since its commencement in August 2020, the group's healthcare segment currently has seven face mask production lines, mainly catering to three-ply and four-ply face masks that contributed RM4.8 million or 12.3% of the group's revenue for the second quarter ended Dec 31, 2020 (2QFY21), and RM5.9 million or 13.8% of revenue for 3QFY21.

The expansion plan will be funded entirely by internally generated funds. 

As of 12.30pm, Pecca was trading at RM4.56, 12 sen or 2.7% higher, with a market capitalisation of RM857.3 million.