Malaysia-based Astral Asia Bhd (AAB) is planning to diversify its core businesses to include e-commerce, focussing on fast-moving consumer goods (FMCG). The new e-commerce business is expected to launch in December 2020, supported by an estimated total initial investment of RM 500,000 (approximately USD 123,000). The diversification is motivated by the major shift in spending caused by the COVID-19 pandemic and changes in business conditions and consumer behavior.
AAB stated that Ray Lim Kuan Hwang, director of its 100% ownership unit, Clean Link and Tasja Development Sdn Bhd, will be the key control personnel to lead and oversee its e-commerce operations, which initially will focus on household cleaning products and heavy-duty cleaning products. The diversification plan will take immediate effect upon obtaining approval from shareholders.
AAB expects its new venture into the e-commerce business to contribute to more than 25% of its profits. It targets the segment to become a significant contributor to its earnings in the future.
Currently, AAB is engaged in oil palm plantation operations, investment holdings and developments, civil engineering, and construction. The group’s earnings have declined lately due to lower crude palm oil (CPO) commodity prices and lower production of fresh fruit bunches (FFB).
(Sources: The Malaysian Reserve; The Edge Markets)
