Hong Seng’s NBL plant to operate from 2024, full ops by FY2031

KUALA LUMPUR: Hong Seng Consolidated Bhd has estimated that its new nitrile butadiene latex (NBL) plant in Kedah Rubber City will be operating at full capacity by its financial year 2031.

In a filing to Bursa Malaysia, the company said its NBL plant is planned to commence in phases, with the Phase 1 production of NBL to commence in the second quarter of 2024 and Phase 2 commencing in the second quarter of 2026.

Phase 3 will commence in the second quarter of 2028 and the expected full operations of all four phases are expected by the third quarter of 2030.

“Thus, the total estimated revenue in aggregate based on the above-planned phases from FY2024 to FY2031 amounted to approximately RM18 billion,” it said.

The company said with the rising global demand as well as a shortage of NBL supply, Hong Seng’s NBL production is expected to fulfil market demand.

“In addition, the world’s major gloves producers are in Malaysia, hence Hong Seng is able to offer a competitive pricing for its NBL after taking into consideration lower operational and logistic costs,” it said.

Meanwhile, in response to a media report on Monday, Hong Seng has clarified that the projected annual revenue of RM4.22 billion mentioned in the report, entitled “Hong Seng Consolidated’s ambitious projections,” was referring to the estimated annual revenue.

“(This is) assuming full production of the NBL plant with a total planned capacity of 960 ktpa (kilo-tonnes per annum) based on the 10-year historical average selling price of NBL prior to 2019 of US$1,250 (US$1=RM4.15) per wet metric tonne.

“The projected annual revenue was derived based on internal assessment and was not reviewed by external auditors,” it added.