INDUSTRIAL Concrete Products Bhd’s (ICP) new plant in China is to account for one-fifth of the company’s total output and contribute significantly to future earnings, managing director Mah Teck Oon said.

The newly-spun concrete piles factory is expected to start operations in November this year and boast higher margins than ICP’s Malaysian factories.

It would be ICP’s first factory overseas, Mah told reporters after the company’s extraordinary general meeting in Petaling Jaya yesterday.

The plant will have a capacity of 240,000 tonnes of pre-tensioned spun concrete piles, raising by 20 per cent ICP’s current total output of 1.2 million tonnes from several factories in Malaysia.

ICP has a 73 per cent stake in the China plant, which will largely cater to demand in the development of ports in southern China.

“We are working in partnership with China Harbour,” he said.

Mah expects the plant to reach full capacity quickly, given prospects of continued rapid development of ports in China.

“Port developments in China expanded at about 30 per cent annually in the past few years. This is expected to continue at the same rate in the next few years,” director and chief operating officer Khor Kiem Teoh said.

Until the China venture starts operating, ICP can turn to jobs in Iran, Bangladesh, Yemen and Singapore it got recently to bolster income from overseas activities, which currently make up less than 20 per cent of group’s total revenue.

The Iran and Bangladesh supply contracts alone are worth about RM20 million and RM25 million respectively, Mah said. ICP also has made initial efforts to sell its products in India.

The biggest boost to ICP’s future earnings, however, should come locally from the supply contract in Tanjung Bin worth about RM85 million.

IJM currently controls more than 60 per cent of ICP’s shares from about 20 per cent about a year ago, after buying most of the additional shares from Hume Industries (M) Bhd.