BIOENERGY-based Elridge Energy Holdings Bhd is expanding its production footprint at its Kuantan plant with the proposed installation and commissioning of four new palm kernel shell (PKS) biomass production lines.
Forming part of an on-going efforts to scale its operations and support future business growth, the expansion which involves a total investment of approximately RM13 mil is targeted for completion in the group’s 4Q FY2026 ending Dec 31, 2026.
The expansion which will be funded through the group’s internally generated funds and/or bank borrowings is separate from – and in addition to – the capacity expansion plan disclosed in the group’s prospectus dated Aug 6, 2024.
Upon commissioning, the four new production lines will contribute an aggregate production capacity of approximately 480,000 metric tonnes (MT) per annum or equivalent to 120,000 MT/annum for each production line.
The additional capacity will increase Elridge’s total installed production capacity from approximately 1.44 million MT/annum to 1.92 million MT/annum which represent an overall increase of approximately 33%.
This expansion reflects the group’s commitment to enhancing its production capabilities in line with growing opportunities within the biomass sector, according to Elridge’s CEO Oliver Yeo.
“The addition of these four new production lines marks another important milestone in Elridge’s growth journey,” he enthused.
“By strengthening our production capacity, we’re better positioned to meet increasing market demand while supporting the group’s long-term growth strategy.”
Added Yeo: “This investment reinforces our commitment to operational excellence and long-term value creation for our shareholders.”
Elridge’s expansion is underpinned by favourable industry fundamentals. According to Coherent Market Insights, the PKS industry size in Asia Pacific grew from US$218.6 mil (RM905.6 mil) in 2019 to US$283.3 mil (RM1.3 bil) in 2023 at a compound annual growth rate (CAGR) of 6.7%.
It is forecast to grow further at a CAGR of 8.9% from an estimated US$308.6 mil (RM1.4 bil) in 2024 to US$366.1 mil (RM1.7 bil) in 2026.
This positive industry trend supports the long-term demand outlook for Elridge’s expanded production capacity.
The new production lines are expected to contribute positively to the group’s revenue and earnings beginning from the financial year ending 2027.
The group expects the completion of the new production lines to not have any material effect on its share capital, shareholdings, net assets, gearing or earnings per share for irs financial year ending 2026.
At the close of Friday’s (July 3) market trading, Elridge was unchanged at 92.5 sen with 2.08 million shares traded, thus valuing the company at RM1.85 bil. – July 4, 2026
