Lingerie maker CAELY (7154) CAELY HOLDINGS BHD to set up JV in Indonesia to ramp up production

Lingerie maker CAELY (7154) CAELY HOLDINGS BHD to set up JV in Indonesia to ramp up production

GEORGE TOWN (Feb 6): Main market-listed Caely Holdings Bhd hopes to set up a joint-venture (JV) in Indonesia this year to increase its production capacity to cater to the growing global demand for lingerie.

Chief executive officer Gok Ching Hee said the company is currently in the midst of finalising the terms and conditions of the agreement with a potential JV partner, that would then invest in a plant in the republic.

“Our JV partner will invest in the plant, which will likely be ready in May or June this year. We target to sign the JV agreement by the end of March,” he told Bernama.

Gok said Caely’s current main export destinations for its original equipment manufacturer undergarment products are Germany, the United States and Canada, however, it has recently been getting more enquiries from companies in Turkey, France and Australia.

He pointed out that the enquiries from these companies were already double Caely’s existing production capacity, which led to the company's decision to expand further, with the plant in Indonesia aiming to increase capacity threefold, compared with its factory in Teluk Intan, Perak.

“We believe that this recent large amount of orders we are getting is due to companies shifting away from sourcing their products in China and that we are benefitting from the trade war in the international arena.

“Judging by the increasing momentum of orders we are getting, we are confident that we will use up the capacity of the Indonesian plant,” he said.

Caely, which was established in 1986 to produce women's intimate apparels, had allocated RM5 million for working capital in October last year to diversify its products including the production of fabric face mask.

Gok said the company would also utilise part of this investment to produce active wear, nightwear and kids wear, soon.

“We have signed a licensing agreement with Disney and this has opened a lot of opportunities for us because we can produce Disney brand apparels,” he said.

He added that the company had planned to eventually move its lingerie manufacturing to Indonesia, while its Malaysian plant would focus on producing face masks and other apparels.

http://www.theedgemarkets.com/article/lingerie-maker-caely-holdings-set-jv-indonesia-ramp-production