Daibochi To Build US$6.8 Mln Manufacturing Plant In Myanmar

KUALA LUMPUR, Nov 14 (Bernama) -- Daibochi Plastics and Packaging Industry Bhd will establish a US$6.8 million (RM29 million) manufacturing plant in Yangon, Myanmar, its first joint venture abroad with Myanmar Smart Pack Industrial Co. Ltd (MSP). The deal will be carried out through its unit, Daibochi Flexibles Sdn Bhd, which will hold a 60 per cent stake in the joint venture company, Daibochi Packaging (Myanmar) Co. Ltd (DPM), while MSP will hold the remaining equity. "This is our first manufacturing facility in a foreign country," said Daibochi Chairman P.James Edwin Louis Pushparatnam at a press conference Monday. DPM is expected to post more than US$8 million (RM35.23 million) in revenue in its first year of operations, based on MSP's annualised financial year e ending Dec 31, 2016, he said. James also said Daibochi would invest an additional US$5.5 million (RM24.22 million) via international generated funds, over the next three years, to enlarge DPM's production capacity and enhance its processes to adhere to international-recognised standards," he said. Meanwhile, Managing Director Thomas Lim Soo Koon said DPM would begin operations in the next three to six months, after securing the necessary approvals from the Myanmar Investment Commission. He said once operations begin, DPM was expected to increase exports from the current zero per cent to 30 per cent in three years. "The expansion in Myanmar will also help Daibochi improve its export sales to 66 per cent within three years, up from 55 per cent, at present" he said. Daibochi currently exports to Australia, New Zealand the Philippines and Thailand. Lim said DPM expected MSP's sales capacity to double once the takeover was completed given Daibochi's know-how, wide customer base coupled with low labour and manufacturing cost in Myanmar. On DPM's future strategy, the managing director said the company was developing new product lines for existing customers in addition to securing supply contracts with more growth-oriented domestic brands. "DPM's low manufacturing cost will grant us a competitive advantage in expanding our exports across the ASEAN region," he added. -- BERNAMA