KUALA LUMPUR: Sunzen Biotech Bhd will engage with relevant government agencies in the next few months to increase the bird’s nest harvesting quota and boost exports to China, aiming to capture a larger market share and capitalise on the product’s growing demand in the republic.
Executive chairman Ching Chee Pun said China has historically been the largest bird’s nest market, importing high-quality products from Malaysia and several regional countries.
China’s market currently accounts for 53% of the Sunzen group’s total revenue.
“We are seeing strong growth for our premium bird’s nest products in China, and sales of our products have been very encouraging. We will be discussing with relevant government agencies to increase our quota for bird’s nest harvesting and also to increase our product exports to China to tap a bigger share in this market,” Ching told reporters after the company’s extraordinary general meeting (EGM) on Friday.
Sunzen subsidiary Ecolite Biotech Manufacturing Sdn Bhd has more than 300 varieties of products, including bird’s nests, tonics and essences in formulated and single herbs.
Ecolite received approval from China’s customs authority in October last year to export its bottled bird’s nest to the country up to 2028.
Yan Ming Resources Sdn Bhd, a subsidiary of Ecolite, is a raw material supplier for its bird’s nest products and is responsible for processing and exporting raw, clean bird’s nests to China. Yan Ming processes and produces more than 400kg of net birds’ nests every month and exports seven tonnes annually. China’s import of Yan Ming products has reached more than 300 tons, and is increasing exponentially every year.
Ching said Sunzen is looking for a new plant to ramp up its bird’s nest production. “We are getting another plant, but this one is not completed yet. But we are looking for a plant to increase our production.”
Sunzen, which changed its financial year-end from Dec 31 to June 30, reported a net profit of RM9.17 million and revenue of RM142.7 million for the 18 months ending June 30, 2024. Human health products comprised 80.45% of the revenue, while loan financing contributed 13.78%.
At the EGM, Sunzen obtained shareholders’ approval to acquire additional shares in Ecolite and Yan Ming. Currently, Sunzen owns 70% of Ecolite, which in turn holds 70% of Yan Ming. After the acquisition, Sunzen will fully own both companies.
The acquisition will be completed with the issuance of 66,101,694 new Sunzen shares at 29 sen each. The deal includes a two-year profit guarantee from the Ecolite and Yan Ming guarantors.
On April 8, Sunzen announced it will stop manufacturing and trading animal health products due to a challenging business environment. Moving forward, the company will focus on traditional Chinese medicine, herbal health foods and beverages, and loan financing via Finsource Credit.
Ching said Sunzen intends to sell its land and factory in Kota Kemuning in Shah Alam, which is valued at RM16 million to RM18 million.
He said the company aims to raise additional capital to support its subsidiaries’ expansion in human health products via Ecolite and financial services via Finsource Credit.
“At this point, we need more capital to expand our business, which is why we plan to sell one of the factory units due to the discontinuation of our animal healthcare business. The factory is valued at approximately RM16 million to RM18 million. Should we proceed with the sale, the proceeds will be invested in our money-lending business,” he said.
