Sarawak funding powers Quality Concrete's showing

The Star

2 days ago

KUCHING: The Sarawak government's big funding for water infrastructure projects has greatly benefitted concrete product manufacturer Quality Concrete Holdings Bhd , particularly in the rising demand for the company's high-density polyethylene (HDPE) pipes.
In the 12-month period to Jan 31, 2025 (FY25), Quality Concrete's sales of own manufactured HDPE and M-PVC pipes surged by an impressive 126.8% to RM19.6mil from RM8.65mil a year ago.
'This growth was fuelled by increasing demand stemming from Sarawak's comprehensive water infrastructure enhancement plans, which include a RM1.1bil pipe replacement initiative and RM6bil rural treated water supply programme spanning the next five years,' said group executive chairman Tiang Ching Kok.
He said the HDPE pipes were widely utilised for water reticulation and as protective channels for underground utilities, such as telecommunication and electrical cabling.
In addition, Quality Concrete also manufactures multi-layer unplasticised polyvinyl chloride (UPVC) pipes, engineered with high-impact resistance to meet the demanding requirements of sewerage networks and water supply systems.
These products, essential components in municipal infrastructure, play a pivotal role in water distribution, flood mitigation and utility service provision in both urban and rural developments.
Tiang said the company's construction arm has expanded its presence in the water infrastructure sector by submitting proposals and forming strategic partnerships with leading technology providers to design, build and operate water treatment plants, particularly in underserved areas in Sarawak.
'These efforts signal our readiness to tap into high-impact, government-driven opportunities aligned with national priorities,' he said in the company's annual report.
He said Quality Concrete continues to explore new business models and strategic collaborations within the water infrastructure sector.
Through ongoing engagements with established technology providers, the company aims to diversify its revenue base by expanding into municipal and rural water treatment solutions. This includes the deployment of modular systems, containerised units and hybrid treatment models tailored to underserved communities.
Tiang said in 1Q26, the company's construction division secured three new contracts worth RM295mil, with three other major projects ongoing.
'The division is well positioned to capitalise on national infrastructure priorities, including the Sarawak-Sabah Link Road, Jendela broadband expansion and various flood mitigation and water infrastructure upgrades.
'Furthermore, potential involvement in strategic infrastructure projects, such as Kuching's proposed deepsea port and new airport, present opportunities for long-term order book growth,' he added.
As a core pillar of the company's operations, the manufacturing segment has ready-mixed concrete (RMC) plants located in Kuching, Sibu, Mukah and Batang Igan.
The RMC plants produce custom-grade ready-mixed concrete tailored to meet diverse project specifications, as well as precast concrete piles integral to foundation works to cater for both government-driven infrastructure development and the private sector projects such as residential building projects.
As part of its strategic expansion,the group has recently ventured into the production of hot mix asphalt to support ongoing and future road construction projects.
'This new capability includes the manufacturing of high-quality hot mix asphalt for public roads and infrastructure, enabling seamless collaboration with the company's road maintenance division for a more integrated and efficient project delivery.
'The move also strengthens vertical integration within the company, enhancing operational synergy and providing greater control over key inputs for its road development and rehabilitation contracts,' said Tiang, pointing out that asphalt prices have gone up by about 15% since 2020.
In 2020, Quality Concrete was awarded a 10-year concession to maintain state roads in Sri Aman and Betong divisions in southern Sarawak.
'Government plans to expand concession scopes could lead to recurring income while the group's solid performance and operational track record position it well for the 2028 concession renewal, and future bids for federal road maintenance projects, including sections of the Pan Borneo Highway,' Tiang said.
In addition to its core business of manufacturing (also involving production of sawn timber and engineered wood products) and construction, Quality Concrete also has a property development arm with a landbank of 81ha located in Kuching and Johor Baru.
Tiang said once property market conditions stabilise, the company plans to unlock value of the landbank by undertaking mid-income housing and mixed-use township projects, particularly in the fringe area's Kuching city's fringe areas.
Going forward, Tiang said a key strategic priority for Quality Concrete is to intensify efforts to secure higher-margin infrastructure and concession-based projects, particularly in sectors such as road maintenance, water treatment infrastructure and essential public works that promise long-term income stability and robust returns.
'The company is also actively evaluating opportunities under public-private partnership frameworks, with a growing emphasis on playing an integrated role in the project value chain through potential adoption of design, build, operate and transfer or design, build and operate models, where appropriate,' he added.