HO Wah Genting Bhd (HWG) intends to diversify into healthcare-related businesses, the group said in a Bursa filing today.
HWG is presently involved in the manufacture and trading of wire and cable, moulded power supply cord sets, cable assemblies for electrical and electronic devices and equipment, and also travel agent and tour related services.
For the past three financial years, the group’s revenue was mainly derived from the manufacturing segment, which contributed approximately 96.9%, 96.9% and 97.1% in FYE 2017 to FYE 2019 respectively.
It has been the group’s plan to venture into other businesses with a positive earnings outlook to diversify its revenue stream and reduce its dependence on the manufacturing segment so as to create sustainable value to its shareholders.
The company also said prospects in the healthcare-related business are positive due to the favourable outlook on the healthcare industry in Malaysia. HWG has identified and is currently conducting internal feasibility studies on several healthcare-related projects or investment opportunities.
“The financial commitment required to put the healthcare-related business (i.e. existing healthcare-related projects) on stream is estimated to be up to RM15 mil, to be funded via internally generated funds, borrowings and equity fundraisings.
“The subsequent financial commitment to expand the healthcare-related business will be funded via the combination of equity fundraisings, internally generated funds and borrowings,” it said.
The proposed diversification will not have any effect on the issued share capital of HWG. It seeks shareholders’ approval at the company’s Extraordinary General Meeting on June 30.
HWG’s shares closed 4.76% lower at 50 sen on June 15. – June 15, 2020
