Ho Wah Genting Bhd shareholders yesterday approved of a rights issue to raise between RM7 million and RM68 million to fund its wire and cable business in Indonesia.
"Additional working capital to finance the purchase of raw and packaging materials for our manufacturing division will contribute positively to our earnings," said managing director William Teo.
As at March 2011, the bulk of Ho Wah's income is derived from its wire and cable business.
Most of the group's power supply cord sets and cable assemblies for electrical and electronic devices are exported to the US.
Recently, Ho Wah's 51 per cent unit HWG Tin Mining Sdn Bhd has been awarded a 10-year mining lease to mine tin until 2020 at a 202.4ha site in Pengkalan Hulu, Grik, Perak.
"From mid-February until now, we've extracted around 30 tonnes of tin ore. Output is low because open-pit mining requires clearance and removal of overburden or top soil before reaching the tin ore body where the bulk of the valuable mineral is deposited," he said.
The tin industry, which contributed about RM2 billion to the country’s gross domestic product annually, is bullish, mainly driven by the consistent consumption globally.
"Back in January 2008, tin was trading at US$16,500 per tonne and as of last month, it has climbed to US$25,500 per tonne. The buoyant pricing is mainly due to global demand outpacing supply. The weakening US dollar had also contributed to the price hike," he explained.
Teo expects tin prices to go on trading at between US$25,000 and US$30,000 per tonne as it is not that easy for tin supply to catch up with rising demand from the electrical and electronics sector.
"Additional working capital to finance the purchase of raw and packaging materials for our manufacturing division will contribute positively to our earnings," said managing director William Teo.
As at March 2011, the bulk of Ho Wah's income is derived from its wire and cable business.
Most of the group's power supply cord sets and cable assemblies for electrical and electronic devices are exported to the US.
Recently, Ho Wah's 51 per cent unit HWG Tin Mining Sdn Bhd has been awarded a 10-year mining lease to mine tin until 2020 at a 202.4ha site in Pengkalan Hulu, Grik, Perak.
"From mid-February until now, we've extracted around 30 tonnes of tin ore. Output is low because open-pit mining requires clearance and removal of overburden or top soil before reaching the tin ore body where the bulk of the valuable mineral is deposited," he said.
The tin industry, which contributed about RM2 billion to the country’s gross domestic product annually, is bullish, mainly driven by the consistent consumption globally.
"Back in January 2008, tin was trading at US$16,500 per tonne and as of last month, it has climbed to US$25,500 per tonne. The buoyant pricing is mainly due to global demand outpacing supply. The weakening US dollar had also contributed to the price hike," he explained.
Teo expects tin prices to go on trading at between US$25,000 and US$30,000 per tonne as it is not that easy for tin supply to catch up with rising demand from the electrical and electronics sector.
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