DRB-HICOM confident of CTRM hitting RM1b revenue

MELAKA, April 11 — DRB-HICOM aims to push one of its subsidiaries, Composite Technology Research Malaysia (CTRM) Sdn Bhd, to hit the RM1 billion revenue mark.

The automotive conglomerate’s group managing director Datuk Seri Syed Faisal Albar told reporters during a media escapade yesterday that he was bullish for the subsidiary, but remained evasive when asked his target date for the company to achieve the RM1 billion milestone.

“We want to achieve it as soon as possible. I think that is where we try to move away from putting a target because then we are creating a promise, when that promise is in public, investors will be excited.

“But maybe there’s a shift in client perspective, therefore we are very shy in giving our target. Aspiration yes, top three in Asean in 10 years but specific detail regarding revenue numbers we tend to shy away, but I can say we want to do it as soon as possible,” he said.

DRB-HICOM group managing director Datuk Seri Syed Faisal Albar addresses the media during a briefing on CTRM’s RM1 billion revenue target in Melaka April 10, 2019. — Picture courtesy of DRB-HICOM

CTRM manufactures composite components such as wings, engine covers and tails for the aerospace industry as it is one of the key vendors for the Airbus.

Last year, CTRM generated RM922.8 million in revenue and its plant expansion in Melaka is expected to generate a further RM208 million per annum. However, the expansion is set to be commissioned only next year despite the completion of the physical building.

As of March 2018, it also had registered an order book of RM9.5 billion for the next eight years.

A CTRM engineer conducts an operational briefing to journalists during a media escapade organised by DRB-HICOM. — Picture courtesy of DRB-HICOM

At the same time, Syed Faisal admitted that the margins for the industry are rather small due to the nature of the business itself.

He said this was the structure created by the clients who are mainly aircraft manufacturers such as Boeing and Airbus who want only a few exclusive vendors handling their needs.

“Margin is slim, true, because that is the structure of the industry because we make sure not many players are doing what you do. You are one or two doing this for us and because of us your margin can’t be so high because you are assured certainty of business perpetually

“That is pervasive throughout the aerospace industry [in] that margin isn’t high,” Syed Faisal said.