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Chapter 1: Introduction
1.1: Company background
Tek Seng Holdings Berhad (TekSeng or the Company) was incorporated in
Malaysia under the Company Act, 1965 on 10 May 2002 as a private limited company
under the name of Tek Seng Holdings Sdn. Bhd. It was converted to a public limited
company on 16 May 2003. It was listed on the Second Board of Bursa Malaysia
Securities Berhad ("Bursa Securities") on 2 November 2004. However, on 22 September
2006, it was successfully transferred from the Second Board to the Main Board of Bursa
Securities.
Tek Seng is an investment holding company. Its subsidiaries are principally
involved in the manufacturing and trading of PVC related product and non-woven related
products, the manufacturing, designing, developing, exporting, importing and sales of
photovoltaic products, solar cells, solar panels, solar modules and solar related products
and the letting of properties.
The Group has a track record of more than 30 years in the plastics industry with
the late Loh Phah Seng (his name is Loh Boon Teik before) as the original founder until
1989, when Loh Kok Beng, his eldest son took over the management of the business.
To further expand on the Groups trading business, Pelangi Segi Sdn. Bhd and
Double Grade Sdn. Bhd were incorporated in 1991 and 1992 respectively. In line with the
Groups intentions to move into manufacturing of PVC products, Wangsaga Industries
Sdn. Bhd was incorporated on 21 June 1995 to commence its business activities of
manufacturing PVC based products. Meanwhile Double Grade Sdn. Bhd, later renamed
as Double Grade Non-woven Industries Sdn. Bhd on 22 September 2005, specialise in
the manufacturing of PP NON-WOVEN materials.
The board of director of Tek Seng Bhd is consists of 6 people. They are Mr.Loh
Kok Beng(executive chairman), Mr. Loh Kok Cheng (managing director), Mdm. Loh Joo
Eng(executive director) , Dr. Kamarudin Bin Ngah, Mr.Mohamed Haniffah Bin
S.M.Mydin and Mr Ong Eng Choon (independent non-executive director).
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Chapter 2: Planning and Strategic Management
2.1: Basic strategies used to respond to uncertainties
1. Prospector
Tek Seng Holdings Bhd has applied prospector as one of the basic strategies to respond
to uncertainties. Tek Seng Holdings Bhd is focusing on developing new markets or
services and in seeking out new markets rather than waiting for things to happen.
Therefore, Tek Seng aims to shore up its strength by dabbling into the solar photovoltaic
(PV) cell manufacturing business in order to diversify its business. The company had
built a RM94 million plant in Bukit Minyak Science Park on the mainland of Penang,
which is TS SolarTech. The company is expected to generate over 70% of the groups
revenue. This shows that the company is able to earn more profit by develop a new
market.

2. Defender
Tek Seng Holdings Bhd has also applied defender as one of the basic strategies to
respond to uncertainties. Tek Seng Holdings Bhd has been known as a PVC manufacturer
over 30 years. The ability of Tek Seng Holdings Bhd to grow substantially over the years
is mainly due to its continuous effort in improving its operational efficiency and product
quality as well as enhancement of its product range. The company produces and supplies
PVC goods like packing film, pattern printed plastic sheet, table cloth, shower curtain,
raincoats, inflatable toys, advertising banners. The company emphasizes the production
of light, durable and efficient PVC products. This shows that Tek Seng Holdings Bhd has
used defender as its basic strategy in order to respond to uncertainty.



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2.2 Establish mission and vision
Tek Seng's mission is to be a profitable company producing affordable and lasting
PVC products for customers and create a company that is caring and attentive to its
employees' welfare. Although the main company is an investment holding company, it
can be said that it is actively involved in the plastics industry through the activities of its
subsidiaries. Tek Seng has a track record of 30 years in the plastics industry. For example,
its subsidiaries are principally involved in the manufacturing and trading of PVC related
and non-woven related products, the manufacturing, designing, developing, exporting,
importing and sales of photovoltaic products, solar cells and other related goods. One of
their objectives is to be a socially responsible corporate in today's world with continuous
efforts to contribute and extend their responsibilities to their employees.
Meanwhile, the company's vision is to be one of the top producers and suppliers
of PVC in the Asian region. To achieve their vision, Tek Seng mainly sells its products to
developing countries due to large population size and growth in construction activities.
For example, the demand from many undeveloped countries to purchase high quality
PVC products has led the company to enjoy a healthy increase in its revenue for the year
2012. The global market for PVC products is exploited fully by Tek Seng in its
operations due to the products' versatility, cost effectiveness and excellent record of use.
Therefore, to stay competitive, Tek Seng will continue to adopt prudent cost management,
improve its operational efficiency, enhancing its product range and product quality as a
leading one-stop PVC products supplier in the region.






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2.3 Perform SWOT analysis
Strength
1. Able to generate high revenue

2. Technology used in manufacture
plastic sheets

3. Provides high quality solar product
Weakness
1. Low innovation and proactive in
producing PVC product

2. Lacks of research and development
for the high-technological machine

3. Poor financial position

4. Minimum salary of employees
Opportunity
1. High demand of the PVC products
in the international trade

2. Invested and develop in new
market, which is the solar industry
Threat
1. Increasing price of raw materials

2. A lot of competitor

Strength
1. Able to generate high revenue
Tek Seng Bhd is able to generate high revenue from its sales, investment and other
service provided. The graph below shows that the revenue of the company has gradually
increased since year 2009:

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2. Technology used in manufacture plastic sheets
The main technology utilized by Tek Seng Bhd is Calendering which is a manufacturing
process where molten plastic is poured between 4 cylindrical rollers and pressed to form
a continuous plastic sheet, which then goes through a series of hot roller pairs that
progressively make the plastic sheet thinner. When it reaches the required thickness, it
goes through a pair of cold rollers to solidity the plastic film or sheet. Although
compared with extrusion process , it needs a higher capital set-up , however, calendaring
process can achieve a much higher output with consistency in thickness and is much
more effective in producing certain types of plastic sheets and films for example among
others , plastic floor covering , plastic films for thermoforming and a range of other
consumer product.
3. Provides high quality solar product
As an international manufacturer of solar product in Malaysia, TS Solartech consistently
provides premium quality solar cells, with outstanding delivery, reliability and a
competitive price. By upgrading its product efficiency and service quality, TS Solartech
constantly supplies state-of-the-art crystalline solar cells to prominent international
module manufacturers worldwide.
Weakness
1. Low innovation and proactive in producing PVC product
Tek Seng Holding Berhad, has low innovation and proactive in producing PVC product.
Although Tek Seng produces a wide range of PVC products, the range of products
include PVC Car Mat, PVC tablecloth, PVC flooring, PVC Tarpaulin, PVC Sheeting and
so on can be found from any competitor.
2. Lacks of research and development for the high-technological machine
Furthermore, Tek Seng Holding Berhad lacks of research and development for the high-
technological machine that can improve their productivity. This is because Tek Seng
Holdings Berhad did not collaborate with any PVC institution and agencies.
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3. Poor financial position
In additional, Tek Seng has poor financial position compared with previous year. Based
on the statement of comprehensive income, the profit for Tek Seng Holdings Berhad has
decrease RM1,908,257 which is 26.9%.

4. Minimum salary of employees
Government implemented minimum salary of employee has increase the cost of
production in Tek Seng Holdings Berhad. Based on the financial statement, the
expenditure of salary has increase RM1,422,144 from the year 2011 to 2012.
Opportunity
1. High demand of the PVC products in the international trade
There is high demand of the PVC products of Tek Seng Bhd in the international trade,
especially from undeveloped countries. For example, it distributes its product to overseas
market including Indonesia, Korea, Myanmar, the Republic of South Africa, Singapore,
Yemen and other countries.
2. Tek Seng Bhd has invested and develop in new market, which is the solar industry
Since 2010, TS Solartech has become the first Malaysian-owned company that inked
contract with a German leading solar equipment maker and equipped with the first
automatic solar cell-manufacturing equipment in Malaysia.. TS Solartech plans to
continue expanding its production capacity in order to achieve greater economies of scale;
by 2015, total installed capacity will reach 640MW.ll-manufacturing equipment in
Malaysia.
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Threats
1. Increasing price of raw material
Tek Seng Holdings Berhad faced the challenge which is increasing price of raw materials.
The price of crude oil in January 2011 is RM283.64 and January 2012 is RM332.62. The
price of crude oil has increase 17.27% in a year.
2. A lot of competitor
Tek Seng Holdings Berhad is facing threats from many other low cost companies
especially in China. The minimum wages in China is lower in Malaysia.

2.4: Assess the grand strategy of the company
From the evidence below, we can conclude that Tek Seng Holdings Berhad is
implementing Growth Strategies. Growth Strategy is a strategy aimed at winning larger
market share, even at the expense of short-term earnings. Four broad growth strategies
are diversification, product development, market penetration, and market development.
Firstly, Tek Seng Holdings Berhad was incorporated in Malaysia under the
Company Act, 1965 on 10 May 2002 as a private limited company. On 16 May 2003, it
was converted to a public limited company.
Private Limited Company Public Limited Company
Scope of the company is wide and
expanding.
Scope of the company is limited in
known people and places nearby
The company has only limited amount of
capital from its limited shareholders as it
cannot subscribe shares and debentures to
the public.
The company can collect huge amount of
capital from the public by selling shares
as it can subscribe shares and debentures
to the public.
Financial position is stronger and can
take larger projects.
Financial position is weak.

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In addition, Tek Seng Holdings Berhad was listed on the Second Board of Bursa
Malaysia Securities Berhad which is for medium sized companies on 2 November 2004.
On 22 September 2006, it was successful transferred from the Second Board to the Main
Board of Bursa Malaysia Securities Berhad which is for larger capitalized companies.
This means that the company has continually expanding its capital.
According to the Financial Statement in the Chairmans Statement, their groups
revenue and profits increased every year compared with the previous year except for the
year when the company was facing financial crisis.
In year 2007, their groups revenue increase by 18.3% as they improved their
sales of products on both domestic and export goods. They also set a higher selling price
of their products to increase their profit. Apart from the existing business, they will try to
get access to a new related business when they have the opportunity.
In year 2008, their groups revenue increased by 11.28%. With a view to increase
their market share, their group will improve their operational efficiency and product
quality along with enhancement of their product range.
In year 2009, their groups revenue decreased by 5.69% due to decline in
international trade caused by financial crisis in the economies worldwide. To stay
competitive among competitors, their group will continue to focus on cost control and
raise themselves as a leading in the PVC products industry.
In year 2010, their groups revenue increase by 12.71%. Their group will be
aware to minimize challenging the external environment and global volatility. Their
group will also continue to focus on cost control, improving their operational efficiency
and product quality together with increase in their product range.




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2.5: Assess the competitive strategies used by the company
Tek Seng is an investment holding company. Its subsidiaries are principally involved
in the manufacturing and trading of poly-vinyl chloride (PVC) related and non-woven
related products, sales of photovoltaic products, solar related products and the letting of
properties.
The competitive strategies used by Tek Seng are cost leadership and differentiation.
1. Cost Leadership
With high-tech production facilities, Tek Seng is dedicated to producing a wide range
of PVC products which are practical, durable, economical options that fit in with today's
lifestyle. The Groups operations can be divided as follows:
a. Manufacturing division, which manufactures PVC-based products. This division can
be further segmented into the manufacturing of:
i) PVC floor covering
ii) PVC films and sheets
iii) Decorative films
b. Trading division, which is involved in the trading of externally-sourced plastic
products and materials not manufactured in-house by the Group. These products
include:
i) PVC sponge leather,
ii) PP non-woven,
iii) Table cloths,
iv) Raincoats,
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v) Other products such as PVC films and sheets for plastic bags, baby mattresses,
accessories for raincoats and shower curtains.
These products are keeping costs and price low, for a wide market. Tek Sengs
manufacturing capabilities enable the Group to produce a diverse range of products
2. Differentiation
Tek Seng is manufacturing and trading of Solar Cell related products. These products
are offering unique and superior value, for the wide market. Malaysia is situated along
the Sun Belt and the sun light is free! It can come to a time that every new houses built in
the future will come with a solar power system on the roof! At present it is still difficult
as the solar power is very expensive. However, when it becomes more popular and the
production is greatly increased, it can become much more affordable.
In the third quarter 2013, Tek Seng received orders for RM2.5mil worth of solar cells,
and going into the fourth quarter it had received orders for about RM2mil. About 80% of
the orders came from China and also get orders from Europe. Furthermore, a four-watt
solar cell is currently sold for US$1.60 (about RM5), down from around US$2.50 to
US$3 two years ago.
On its raw material, the company imported the multi-crystalline silicon wafer from
Taiwan and China because it is cheaper to source. The raw material also lowers the cost
of production, which enable us to compete better in the international market. But, the
alternative is to use mono-crystalline silicon wafer, which is more expensive to source.
Mono-crystalline silicon wafer produces more energy efficient cells, but the selling price
is also higher.




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Chapter 3: Recommendation
3.1 Utilizing the identified strengths and opportunities
STRENGTH
1. Able to generate higher revenue
To maintain the increase in revenue, Tek Seng Bhd should implemented more marketing
strategies such as make more promotion about their product and increase the quality of
service provided by staff.
2. Technology used in manufacture plastic sheets
The future success of the company is depends on its ability to maintain and enhance its
technological capabilities and successfully anticipate or respond to technological changes
in the manufacturing process in a cost-effectively and timely basis. Therefore, Tek Seng
Holdings Bhd should invest in more advances machineries and technologies to keep
abreast with the latest technology and technical know-how.
3. Provides high quality solar product
In order to continue to provide high quality solar product in domestic market and
overseas market, the company should always doing research on improving the quality of
solar product. The company should also recruit more professional employee in solar
industry.
OPPORTUNITIES
1. High demand of the PVC products in the international trade
Since there is high demand of PVC product in the international trade, Tek Seng Holdings
Bhd should try to export their product to more countries such as Australia and so on. If
possible, they should set a target to export their product around the world.


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2. Invested and develop in new market, which is the solar industry
Tek Seng Holdings Bhd had invested and developed a new market in year 2010, which is
solar industry. From this action, the company is able to generate and increase their
revenue. Therefore, they should develop and diversify their business to more market.

3.2 Overcome the identified weakness and threats
WEAKNESS
1. Low innovation and proactive in producing PVC product
Tek Seng Holdings Berhad should send their workers to the PVC innovation centre (For
example: Loughborough University) to increase their creativity in introducing unique
PVC product and not easily obtain from any competitor. The unique of product can let
Tek Seng Holding Berhad have competitive advantage in producing PVC product.
2. Lacks of research and development for the high-technological machine
Tek Seng Holdings Berhad cannot keep abreast with the latest development in technology
that can increase productivity of PVC. Tek Seng Holdings Berhad should join the
association, institute and agency that related to PVC. For example, Tek Seng Holdings
Berhad should join Malaysian Plastics Manufacturers Association (MPMA) in order to
upgrade the technological level of the plastics.
3. Poor financial position
Tek Seng Holdings Berhad should decrease the unnecessary expenditure. Based on the
statement of comprehensive income, other expenses has increase RM2,232,809 which is
24.5% compared with previous year.
4. Minimum salary of employees
Tek Seng Holdings Berhad should import the high-technological machine that can
reduce excessive dependence towards worker and decrease the cost of production.
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THREATS
1. Increasing price of raw materials
Tek Seng Holdings Berhad should implemented the Mechanical Recycling by using used
PVC to become new source material. The mechanical recycling process is a common part
the PVC industry in the reuse of post-industrial scraps. By using mechanical recycling
can reduce excessive dependence towards crude oil.
2. A lot of competitor (low cost company)
Tek Seng Holdings Berhad should build the factory in China which can get the lowest-
wages employee in order to decrease the operational cost. The electricity price in
Malaysia in higher than China. Furthermore, Tek Seng Holdings Berhad should use the
high-technological machine to increase the productivity and it also can lower the cost of
production.










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Chapter 4: Conclusion
4.1 Asses the overall achievement of the company
In conclusion, Tek Seng Holdings Berhad is a firm that shows promise in the
constantly changing business world. From an overall perspective, the company is able to
tackle the challenges that comes its way by applying certain strategies to improve itself.
Therefore, it would be safe to say that the company can continue to operate successfully
and also start to diversify to more fields of industry, making it one of the country's top
developing firms.
The company is actively involved in the plastics industry although it is also
starting to expand its operations to other industries, with the most prominent being the
solar cell industry. With this in mind, the company has opted for a growth strategy by
converting to a public limited company to better understand its customers' preferences
and also its environment. With a long tradition of producing PVC-related products, the
company usually sells or supplies its products to a wide market, but at the same time, it
also varies its prices to cater to different ranks of customers who range from local buyers
to large multinational firms.
So far, the company enjoys an advantage of being able to generate a high revenue
through sales. Besides, it is capable of producing high quality products thanks to a good
manufacturing technology. However, the company lacks research in its field, causing a
low level of innovation in the organization, making it vulnerable. In addition, the
company is not appealing to the workers' point of view with its low minimum wage level.
This may result in a future shortage of manpower. The weak financial situation of the
company is another cause of concern.
For external matters, the company has grasped some valuable opportunities by
exploiting the market's demand for PVC products by selling more and also expanding to
a new field of business so that it can maintain its profits. On the other hand, it has to cope
with rising prices for its resources, thus reducing its profits and its ability to respond fully
to the situation. Moreover, it faces a constant threat of new competitors, some of whom
may take away its customers.
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In the end, Tek Seng Holdings, being an expanding and responsive company, can
be able to generate good profits for the time being, but it is otherwise in the long run.
Hence, it must take steps to ensure its present run of good fortune can last for the time to
come. Only when that target is achieved can Tek Seng count itself as one of the most
dynamic and solid companies in the region, with a chance for greater renown on the
world stage.