GEORGE TOWN: Pentamaster Corp Bhd will inject RM30mil to expand its business operations in 2021.
The technology company’s group chairman C B Chuah told StarBiz that of the amount to be injected into its business, about RM25mil is for adding another 90,000 sq ft for its Batu Kawan production floor, while the remainder is for its design house on the island.
Chuah said the fresh investment was necessary because its Batu Kawan plant was already fully utilised.
“The extension will be ready by February 2022. The initial utilisation for 2022 would be around 30%, ” he added.
To date, the group has secured purchasing orders for factory automation solutions and automated test equipment worth over RM200mil to be delivered this year.
“We are still taking in orders. The cut-off date for orders to be delivered in 2021 is end of September.
“The smartphone segment is expected to generate 40% of the group’s revenue, while automotive another 30%.
“The warehouse automation, medical and semiconductor segments will contribute the remainder, ” Chuah said.
According to Chuah, the group has secured new orders from automotive component manufacturers in China, Taiwan, Japan and the United States.
According to the International Data Corp (IDC) Worldwide Quarterly Mobile Phone Tracker, smartphone shipments are forecast to grow 13.9% year-on-year in the first quarter of 2021 and 5.5% for the full year.
The research firm, TrendForce, expects yearly vehicle sales to increase from 77 million units in 2020 to 84 million units in 2021.
“The electric vehicle segment is consuming a lot of semiconductor components, ” Chuah said.
According to SEMI, global sales of semiconductor manufacturing equipment by original equipment manufacturers are projected to register a new industry record of US$68.9bil in 2020.
“SEMI predicts that the growth is expected to continue, with the global semiconductor manufacturing equipment market reaching US$71.9bil in 2021 and US$76.1bil in 2022, ” Chuah said.
“For this reason, we are preparing to allocate another RM50mil to expand the Batu Kawan plant in 2022. If the market continues to be good, we will spend another RM20mil in 2023 for the Batu Kawan plant, ” he added.
Chuah said a year ago, the group diversified into the production of front-end wafer semiconductor test-equipment.
“The new business generated 5% of our 2020 revenue, ” he said.
Pentamaster’s test equipment is mainly used in the assembly and packaging segment.
“The global market demand for assembly and packaging equipment market is projected to grow 20% to US$3.5bil in 2020, followed by 8% and 5% increases in 2021 and 2022, respectively, driven by advanced applications, ” Chuah said.
According to Chuah, the group will establish more regional sales and service centres to promote the sales of factory automation solutions and automated test-equipment in countries and regions where growth is expected for electro-opto smart sensor, automotive semiconductor, single-used medical devices, and consumer and industrial products.
Chuah said with the recent accelerated demand for the online e-commerce industry, emerging multichannel distribution channels, globalisation of supply chain networks and increased adoption of micro-fulfilment centres, the group sees growing opportunities in the warehouse automation system (WAS) sector.
“In 2018, Pentamaster injected RM15mil to develop autonomous mobile robots, high-speed sorter, lifter, warehouse management software (WMS) and Wide Area Warehouse Network (WAWN) which interconnects and monitors global supply chain networks.
“The complete ecosystem for our warehouse automation system is known as i-Hub, ” he said.
In 2020, the US-China trade tensions impacted the group’s performance.
“Global travelling restrictions and disruption in the supply chain – consequences of the global pandemic – also helped drive the group’s revenue and after-tax profit respectively by 14% and 17% to RM418.6mil and RM109.1mil, ” Chuah said.
“Despite these developments, we were able to hold up well in the fourth quarter of 2020 and the first quarter of 2021 due to our diverse solutions and new demand sales orders generated from the insulated gate bipolar transistor assembly and test equipment for electric vehicle automotive and electro-opto test equipment for the 5G smartphone sector.
“However, we anticipate 2021 to be equally challenging due to travel restrictions and lockdowns of border crossing, ” he added.
Source : The Star
By David Tan