Pecca to collaborate with MARii on product expansion and electric vehicles (EVs) parts technology
Pecca Group Berhad (Pecca or the Company), a Bursa Malaysia Main Market listed company mainly involved in vehicle leather upholstery manufacturing and design, signed a Memorandum of Understanding (MoU) with Malaysia Automotive Robotics and IoT Institute (MARii) today for the Company and its subsidiaries (the Group) market expansion of products as well as collaboration in electric vehicles (EVs) parts and components technology.
The MoU will see MARii, a technology agency under the Ministry of International Trade and Industry (MITI) developing new opportunities for Pecca in its pursuit to expand its capabilities to offer more competitive products to global brands. This includes the enhancement of operational efficiency of Pecca’s business process by integrating Industry 4.0 systems, which will better prepare and fully equip the Group to meet all the requirements of new customers.
In addition, both parties agree to explore the development of automotive manufacturing capabilities for an expanded variety of vehicle parts — including EVs, its localization and after sales support ecosystem.
Present to witness the MoU exchange was MITI Secretary General, Datuk Lokman Hakim Ali. The MoU shall remain in effect for a period of two years commencing today.
Commenting the MoU signed today, MARii Chief Executive Officer Dato’ Ts. Madani Sahari stated: “We are proud to initiate this collaboration with key industry players such as Pecca, as this is yet another example of public-private partnership in one of the most exciting times for electrification in this country.”
“We believe this is an important contribution towards electrification in Malaysia, in line with the National Automotive Policy 2020 (NAP 2020) that envisions a strong pool of automotive component suppliers, that are producing the critical components needed to make the NAP2020 a reality,” he added.
Meanwhile, Pecca Group Managing Director Datuk Teoh Hwa Cheng said: “The full duty exemptions for EVs as proposed in the recently tabled Budget 2022 will certainly broaden the market for EVs and EV-specific components in the country. Thus, the collaboration with MARii starting today will mark an exciting journey ahead for the Group to start manufacturing new products related to the EV segment to capture fresh opportunities in the automotive and mobility industry.”
He explained that in the longer term, the Group will also eventually look at venturing into manufacturing EVs and partnering with overseas EV brands for localization.
“Through this MoU, Pecca will be able to transform itself into a Tier 1 supplier which markets and sells its current and new products to OEMs with access to a larger client base. This is expected to contribute positively to the overall future earnings as well as the earnings per share of the Group,” concluded Datuk Teoh.
With a market capitalization of approximately RM650 million, Pecca is principally involved in the styling, manufacturing and installation of leather upholstery for seat covers for the automotive and aviation industries. It is the largest automotive leather upholstery player in Malaysia’s OEM and pre-delivery inspection (PDI) passenger vehicle segments, and it also serves export markets such as Singapore, the US, the Netherlands, Australia, New Zealand, UK, Ireland and China. The Group also manufactures healthcare products through its subsidiary.
In the financial year ended 30 June 2021 (FY21), both Pecca’s revenue and profit after tax (PAT) hit a record-high. FY21 revenue rose by 38.3% y-o-y to RM144.75 million, whereas PAT increased by 2.3 times y-o-y to RM19.22 million. The stronger revenue was mainly due to improved contribution from the automotive segment, particularly higher OEM car seat covers sales.
