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Malaysian-owned Cambodia rice mill project seeking investment up to USD34 million

Malaysian-owned Cambodia rice mill project seeking investment up to USD34 million

EXECUTIVE SUMMARY

This business plan is prepared with the intention to secure a funding of up to USD34 million to build an Integrated Rice Mill Complex in Kampong Cham, Cambodia. The breakdown of the funding is as follows:-

Machineries USD15.4 million;
Building USD4.65 million;
Land USD0.63 million;
Other equipment. USD0.57 million;
Working capital USD12.6 million
The integrated rice mill will be built on a piece of land with the size of 4.1 hectares. Total build-up of the rice mill is about 31,843 square meters inclusive of electricity sub-station, warehouse, office and etc.

An additional funding is also required for working capital in Malaysia amounting to USD6.3 million to purchase rice. In Malaysia, we already have existing customers and contracts with hypermarkets such as The Store, Giant and Tesco. We also have our own brand namely xxxx and xxxx.

The Company has high aspiration to become a globally well-known player in the production, trading and export of high quality rice. Cambodia, as a third world country is unfortunately unable to meet the international standard due to substandard existing technology and therefore is welcoming foreign investors with new and efficient technology to optimize productivity up to par with the neighboring rice producers which is Vietnam and Thailand. lt is the hope of the country that within the period of 5 years, agriculture will become a major force into driving the economy out of the abyss of the third world stigma.

xxxx Sdn. Bhd. will undertake this venture through its 80% owned subsidiary company which is operating in Cambodia namely xxxx (Cambodia) Ptd. Ltd. The Company was set up with a local and well established partner who has been involved in various businesses and industries. The proposed 4.1 hectares land for the construction of the integrated rice mill complex which will be purchased by the Company is located in the paddy growing area in Cambodia. There is another 5 hectares of land attached to the proposed rice mill that is available for future business

The period between February to July is considered a suitable time to do construction in Cambodia because it is dry season. The rice mill will use LSU type dryer with the drying capacity between 900MT to 1,000MT paddy per day or 25,000MT per month (25-day per month). We estimate one harvest season will run for about 2-month, and there is 2-season in a year. Thus, the rice mill can dry paddy of up to minimum of 50,000MT per season or 100,000MT per year. Our strategy is to maximize the paddy supply throughout the year and not depending on traditional harvest season only. Currently, the harvesting season is not simultaneous in Cambodia. We may have an opportunity to buy more paddy outside our territory of Kampong Cham provided we have enough fund.

Our milling capacity is calculated around 36MT paddy per hour (36MT x 12 hours x 25-day) or 10,800MT per month. If the mill is run through the whole year, it capacity can go up to almost 130,000MT paddy. If we increase the work hours from 12 hours per day to 16 hours per day, definitely we can mill more rice. The recovery from paddy to rice after milled is approximately 56% head rice and 10% broken rice. Beside rice, we can venture into rice by-product business activities such as vermicelli, animal feed, rice bran cooking oil, supply of bio-mass energy and etc.

With financial assistance and facilities acquired, the Company shall have a solid footing to thrive and fulfill its foreign business endeavors and thus will stand a great chance to be successful in managing the rice milling plant, producing rice by products and involved in other related agro-business activities.