Winstar Capital to expand production capacity with 4 lines at new RM14.5m plant
The target will be achieved through the acquisition of four additional aluminium extrusion lines.
'The new facility and the acquisition of four additional aluminium extrusion lines are part of our growth strategy, which will significantly boost our production capacity. This expansion is a key step in meeting rising demand and strengthening our market position,' Winstar Capital CEO Chua Boon Hong told reporters after the company's annual general meeting today.
Winstar Capital has commenced construction of a manufacturing facility adjacent to its existing plant in Ijok, aiming to support its growth ambitions and meet rising demand.
Known as the Lot 903 Facility, the new site, with an estimated cost of RM14.50 million, spans some 80,000 square feet and is designed to accommodate four aluminium extrusion lines along with expanded storage space.
Chua said the expansion is progressing well under the original schedule, despite the current tariff episode created by the US government, which has disrupted the global supply chain.
'We anticipate stronger demand coming from our customers towards the end of 2025. We are likely to bring forward the installation of another two new aluminium extrusion lines by the first quarter of 2026, instead of only installing them in the second quarter of 2026,' he added.
The new facility is financed through a combination of bank borrowings and internally generated funds, of which RM11.6 million in loans have been secured.
In its presentation, Winstar Capital noted that the strategic expansion will boost the group's operational efficiency.
Construction began in April 2024 with operations expected to commence by the third quarter of this year.
The estimated cost of acquiring the new extrusion lines is RM9.55 million, which will be funded primarily with the proceeds from its public issue. Should there be any shortfall, the group intends to cover the additional costs using bank borrowings and internally generated funds.
Chua said, 'With this expansion, we will be able to offer a broader range of extruded aluminium profiles to meet the diverse needs of our customers. As of Dec 31, 2024, we had a total of approximately 5,954 stock-keeping units for our aluminium extrusion segment and the trading and distribution of building materials segment.'
He said that with higher tariffs imposed on Chinese aluminium product manufacturers by the US government, Winstar Capital has received a growing number of inquiries from potential European and US customers considering purchasing aluminium products from Malaysian manufacturers.
'Many of them are actively looking for alternative suppliers in Southeast Asia to reduce their overreliance on Chinese manufacturers. This shift in global sourcing is creating new opportunities for us,' Chua stated.
Winstar Capital recorded revenue of RM203.39 million for FY24, marking an increase of RM49.7 million or 32.3% compared to RM153.69 million in FY23.
The increase was mainly attributable to higher revenue from the aluminium extrusion segment, which rose by RM32.84 million, mainly due to greater demand from customers in the construction and property development industries.
In tandem with the revenue growth, the group's gross profit increased by RM6 million, or 19.8%, from RM30.35 million in FY23 to RM36.35 million in FY24.
Despite the increase in gross profit, Winstar Capital reported a decrease in profit before tax (PBT) by RM2.09 million, or 17.8%, from RM11.72 million in FY23 to RM9.63 million in FY24. The PBT margin decreased from 7.6% in FY23 to 4.7% in FY24.
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