LSH Capital Group which was initially involved in the construction products segment upon its listing on the LEAP Market which includes distribution and/or retail of building materials is now looking to go upstream into the construction business.
This was upon its acquisition of 100% equity interest in LSH BEST Builders Sdn Bhd for a total purchase consideration of RM3.5 million in October 2021. As at June 2022, LSH Capital Group, via LSHBB, has a secured external construction order book amounting to RM969.4 million in aggregate with an outstanding external construction order book of RM853.1 million.
In addition, LSHBB is also involved in the provision of construction and business-related services and solutions via the BEST Framework collaboration for the construction projects secured by LSHBB’s clients and property development projects undertaken by LSHBB’s clients with a total project value of RM2.7 billion as at 30 June 2022, whereby LSHBB will earn fees for the services provided.
According to the group the proposed diversification is sought as the Board anticipates the Construction Related Businesses will contribute 25% or more of the net profits of LSH Capital Group, which will be one of the major contributors to LSH Capital Group in the future.
It is also the intention of the Company to diversify its core business into Construction Related Businesses after taking into consideration the expected revenue and profit contribution from LSHBB. The Proposed Diversification will allow the LSH Capital Group to be involved in the upstream supply chain of the construction industry, which is in line with the BEST Framework adopted by the LSH Capital Group with the aims to transform the core foundation of the construction industry,
