KUALA LUMPUR: Life Water Bhd has earmarked RM15 million in capital expenditure for FY2026 to fund its East Malaysia expansion, including new distribution centres, fleet upgrades and additional in-house bottle production capacity to close market gaps in Tawau and prepare for demand driven by Visit Malaysia 2026.
Managing director Liaw Hen Kong said the investments are aimed at closing key coverage gaps, particularly in Tawau, where the group currently has only 10–20% market penetration, compared with about 50% market share in most other districts.
“So in the coming financial year 2026, we have Tawau. Tawau is the area where we are quite weak. I can say that we have only maybe 10% to 20% penetration rate. In other areas, informally, we are close to 50% market share. So there is still a big gap in the Tawau area. That’s why we are going to have a new DC (distribution centre), which will be completed early next year,” he said at Life Water’s Q1 FY2026 press and analyst briefing today.
The group is currently setting up its first Tawau Distribution Centre, a RM6.6 million facility scheduled to commence operations in the first half of 2026, to enhance coverage in the region’s east coast.
Life Water has expanded its delivery fleet from 70 to 90 trucks, supported by a broader warehouse network to ensure faster and more reliable distribution across Sabah and Labuan.
To boost in-house production efficiency, the company has also completed the installation of two PET preform moulding machines at its KK IZ8 Plant 1 in August 2025, a part of a RM5 million investment that allows Life Water to produce 18g and 26g preforms internally to support capacity expansion.
On the production side, at the Sandakan Sibuga Plant 1, the installation of new machinery was completed and began running in July 2025, raising the group’s annual drinking water production capacity by 40% to 626 million litres.
On the outlook and prospects for FY2026, Life Water expects growth to be driven by expanded production capacity, improved operational efficiency and stronger market presence.
Liaw said the group is scaling its capacity further following the recent 40% uplift as well as new high-tech machinery and a wider product portfolio.
“Life Water’s sales and marketing outreach remains strong, particularly on platforms such as TikTok, Xiaohongshu and Instagram, helping to strengthen brand awareness among younger consumers,” he added.
Liaw said demand prospects remain favourable because of Visit Malaysia 2026, with higher incomes, evolving consumer preferences and rising tourist arrivals expected to support bottled water consumption.
“The projected 3.3 million tourist arrivals in Sabah this year are expected to support higher sales with more arrivals from China, Japan and Thailand. This benefits us, especially through the hotel segment,“ he said.
He also noted that inadequate water infrastructure in some rural areas continues to drive reliance on packaged drinking water.
“The market still needs more water. Because of the poor infrastructure in certain rural areas, they need more bottled water for daily use. So we are just meeting that need, and we need to improve accessibility across all areas,” he said.
