Kanger (0170) has released the company’s Annual Report 2021.  I am glad to share some positivities related to the current and future progress of the company based on my glance at the annual report. I will not take note on the balance sheets aspects in this article. The Annual Report 2021 can be retrieved @

 https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3189156

Some of the positive notes are as follows:

1. NEW ENGINES OF GROWTH FOR BAMBOO AND RELATED PRODUCTS

• In the fourth quarter of 2020, the construction of the company new bamboo concession and processing plant in Jingzhou was completed. Although the plant is still in the early phases of testing and commissioning, the company is looking forward to the positive financial contribution it will bring to the Group once commercial production commences.
• The expansion in Jingzhou will allow the Group to focus not only on manufacturing of bamboo products but also processing of bamboo related foodstuff and bamboo eco-tourism in the near future.

MY COMMENT:

1. The company has stated the promising progress has been made in the relocation of the new bamboo and processing plant. The company still keen on the potentials of  its bamboo and related products business to be turn around especially after the new processing plant in Jinzhou started to operate.  

2. CORPORATE MILESTONES OF THE COMPANY IN 2021

• Diversified into new construction business aimed at deriving synergy with the property investment and management segment.  Acquired 51% stake in building materials supplier, Sung Master Holdings Sdn Bhd for RM94.8 million. Acquired 126 units of service apartments at Antara @ Genting Highlands for RM142.87 million.

• One of the new subsidiaries, Kanger Medical International Sdn Bhd is making inroads into the healthcare industry by sourcing for face masks and Covid-19 vaccines.

MY COMMENTS:

1. These "corporate" statements give us the SIGN that the BOD and the company has tried to do some efforts for the betterment of the company in future.
2. The company are diversifying and also entering business activities in Malaysia, instead of solely relied on the PRC business activities. Some of the progress of diversification can be read below:

• Currently, the Group is working together with a few parties to complete multiple construction projects across a few sites in the state of Selangor and Pahang to the tune of approximately RM1.0 billion. The Group is also in the midst of applying for the Grade 7 contractor license from the Construction Industry Development Board (“CIDB”) and aims to tender for new construction projects to further grow our construction orderbook.
• The Group will be purchasing a 51% stake in building materials supplier, Sung Master Holdings Sdn. Bhd. The acquisition will broaden the Group’s product offerings to also include other building materials such as timber, flooring, tiles, bulk cement, concrete, locksets and sanitary ware. This strategic acquisition is well-aligned to strengthen and complement the Group’s newly established construction business as Kanger will be able to source the building materials directly from Sung Master’s suppliers to better manage the input cost and enhance the profitability of these construction projects.
• The Group had also purchased 126 service apartment units at Antara @ Genting Highlands on an enbloc basis. Expected to be completed in 2024. The company believes that the rental income or capital gains arising from these property units will contribute positively to the company.

3. THE EMERGENCE OF MR KUAH CHOON CHING AS A MEMBER OF THE BOD ON  24 AUGUST 2020 AND HIS FUTURE PLAN TO BE A SUBSTANTIAL SHAREHOLDERS OF THE COMPANY

• Mr. Kuah is an experienced businessman and entrepreneur with a proven track record in the diverse sectors of consumer products, property development, and manufacturing for various packaging industries.  He has experienced in spearheaded corporate exercises such as fund raising, diversification and share buy-back exercises for the company. He is very well versed in various industries, such as manufacturing and printing for the glove making, medical, electrical and electronics, automotive industries and more.
• Currently, Mr. Kuah owned  25 million units of shares, equivalent to 0.89% shareholding of the company shares, the biggest share holder amongst the members of the Board of Director of the company.
• Mr. Kuah entered into a subscription agreement for a subscription of 769.51 million new Kanger shares at the subscription price of RM0.06 per share to partially finance the purchase consideration for the acquisition of 51% stake in Sung Master. After this subscription of shares exercise, Mr. Kuah will become a substantial shareholder of Kanger.

MY COMMENTS:

1. Mr. Kuah as the Executive Chairman of the BOD has used his experiences in the company to plan some corporate exercises such as diversification and fund raising exercises for the company. The company has decided to place stronger emphasis on expanding our new business segments which are involved in construction and property investment and management. Several fund raising exercises has been planned which are involved ESOS, private placement and right issue of shares in order to fund several plans of diversification exercises.
2. As there is no substantial shareholders in the company as at 30 July 2021, the percentage of shareholdings among director and insiders is small. This condition is not so good for the company as the share holding spread in the company is too wide. Mr. Kuah will become a substantial shareholder of Kanger and will generate more positivity to the company in terms of reducing share holding spread, strengthening  his BOD power in the company and uplifting his concern, ownership and integrity while managing the company.  

** DISCLAIMER: I wrote this article based on my research from the information reported on the web. All information given should not be considered as an investment advice. Please do your own analysis or consult your qualified financial advisor for advice. All  information is not a buy call or a sell call in any securities transactions.