Scientex to invest $92.5m to expand packaging film production

24 September 2014 (Last Updated September 24th, 2014 18:30)

Malaysian packaging producer Scientex Berhad will invest around RM300m ($92.5m) to expand polyethylene (PE) and biaxially oriented polypropylene (BOPP) film production capacity, as well as enter the new business of cast polypropylene (CPP) film production, over the next three years.

Malaysian packaging producer Scientex Berhad will invest around RM300m ($92.5m) to expand polyethylene (PE) and biaxially oriented polypropylene (BOPP) film production capacity, as well as enter the new business of cast polypropylene (CPP) film production, over the next three years.

The investment forms part of the company's strategy to become a major consumer packaging supplier in the Asia Pacific region.

Scientex plans to construct an advanced BOPP film manufacturing plant in Pulau Indah, Port Klang, under a partnership with Japanese BOPP film producer Futamura Chemical.

Japan Steel Works and Windmöeller & Hölscher will supply BOPP film production machinery and PE film production machinery, respectively.

"The investment forms part of the company's strategy to become a major consumer packaging supplier in the Asia Pacific region."

In addition, Reifenhäuser will install Reicofeed 2.1 feedblock at the plant.

Upon completion in 2016, the proposed plant is expected to expand Scientex's production capacity tenfold, from the current 6,000mt to 60,000mt annually.

Scientex Berhad managing director Lim Peng Jin said: "We believe that this significant investment in increasing our current consumer packaging capacity and extending our range of films would grant us the strategic opportunity to garner a larger slice of the consumer packaging market in the Asia Pacific region.

"Our primary objective would be to achieve cost-efficient production across a wide range of consumer films, so that our customers in the F&B manufacturing sector would benefit from lower-cost input prices."

Scientex generated RM148.5m ($45.7m) in net profits for the year ending 31 July 2014, up 34.6% compared with RM110.3m ($34.01m) during the previous year.