HGH Holdings Ltd. Issues Detailed Responses to SIAS Queries: Key Takeaways for Investors

Date: 28 April 2026

Overview

HGH Holdings Ltd. (“the Company”), together with its subsidiaries (“the Group”), has released comprehensive responses to questions from the Securities Investors Association (Singapore) (“SIAS”). The responses touch on recent business developments, strategic investments, financial decisions, and board composition, all of which hold significant implications for shareholders and could influence the Company’s share value.

1. Ready-Mix Concrete Segment: Dramatic Revenue Growth and New Plant Commissioning

• Financial Performance: The ready-mix concrete segment posted a substantial revenue increase from \$5.3 million in FY2024 to \$25.8 million in FY2025. Losses of \$(1.4) million in FY2024 turned into a profit of \$2.6 million in FY2025.
• Competitive Position: The Group positions itself as a nimble, cost-efficient operator, targeting projects overlooked by larger competitors, benefitting from a lean structure and responsive customer service.
• Growth Drivers:
  • Commissioning of a new ready-mix concrete plant in Q1 FY2025, boosting production capacity and economies of scale.
  • Strong support for Poh Huat Heng Corporation Pte. Ltd. (“PHH”) projects, particularly in underground cable installation.
  • Focus on niche markets within civil engineering and customisation for key clients.
• Depreciation Impact: Depreciation of property, plant, and equipment rose from \$0.54 million to \$1.51 million, largely due to the new batching plant. Utilisation of the plant reached over 80% by year-end FY2025.

2. PHH Acquisition and \$9 Million Impairment: Board’s Stance

• Full Impairment of PHH Investment: The \$9 million investment in PHH (underground cable installation and road reinstatement) has been fully impaired. Despite this, the Board remains confident in PHH’s operational viability and competitiveness, citing its technical and industry experience, and ongoing project pipeline.
• Ongoing Review: The Board and management conduct regular reviews of PHH’s business and other Group operations.

Shareholder Note: The full impairment of a significant investment is a material event, but the Board’s confidence in PHH’s future viability could mitigate negative sentiment. Investors should monitor future disclosures for any further developments regarding PHH.

3. Strategic Investment in Agri-Tech: Entry into Cool Farms Holdings

• Investment Details: The Group has agreed to acquire a 13.5% stake in Cool Farms Holdings Pte. Ltd. for RMB 20 million, paid in two tranches.
• Rationale & Alignment: Although not directly related to HGH’s core business, the investment was sourced through existing networks and is seen as a strategic move to collaborate in hydroponic crop modules, germplasm resources, and smart vegetable farm chain management. The decision aligns with Singapore’s food security agenda and seeks to tap into the high-growth agri-tech sector in Asia and the Middle East, projected to reach \$209 million and 45% of the global market by 2030.
• Risk Assessment: The Board asserts that Cool Farms is profitable and in a positive net asset position per its latest unaudited financials. The minority stake is not expected to significantly alter the Group’s risk exposure. Due diligence, including site visits, was conducted.

Shareholder Note: This move marks HGH’s entry into the agri-tech sector, a potentially lucrative but non-core business area. The transaction’s profitability and alignment with national priorities could be seen as a positive diversification, but shareholders should assess the risk of venturing outside traditional areas of expertise.

4. Divestment of Premium Concrete Pte. Ltd.: Financial and Strategic Synergies

• Transaction Overview: HGH is divesting a 20% stake in Premium Concrete Pte. Ltd. (“PCPL”) for \$2.4 million to Mr. Lim Kui Teng, implying an equity valuation of \$12 million. An independent valuation as of 31 July 2025 placed PCPL’s value at \$12.0–\$12.5 million.
• Valuation Methodology: The independent valuation used the Guideline Public Company method (GPCM), based on forecasted revenue and EBITDA. Adjustments included a 33% control premium and a 16.9% discount for lack of marketability.
• Loan Waiver: The waiver of \$6.26 million in loans owed by PCPL was not factored into the independent valuation but was part of negotiations. The write-off had no impact at the group level.
• Strategic Rationale: The divestment aims to deepen operational and commercial synergies with Chuan Lim Construction, enabling continued services, raw material supply, and access to Chuan Lim’s network in construction, property development, and dormitories.

Shareholder Note: The transaction strengthens partnerships and could open new revenue channels. The write-off and divestment terms are important financial events that may impact both valuation and future profitability.

5. Board Composition and Succession: Compliance and Diversity Initiatives

• Director Retirement: Mr. Ng Ser Chiang, Lead Independent Director and committee member, will retire at the next AGM. His departure will temporarily leave the audit committee below required composition, putting the Board out of compliance with certain governance codes.
• Succession Planning: The Company is actively seeking a new independent director and targets filling the vacancy within 2-3 months to comply with Catalist Rules.
• Competency Review: The Nominating Committee annually assesses Board skills and experience and currently sees no critical competency gaps, but remains committed to diversity and succession planning.
• Sponsor Guidance: Ongoing guidance is provided by the Sponsor, emphasizing the need for a balanced Board with appropriate skills and independence.
• Diversity Policy: The Board’s diversity policy is actively reviewed, with considerations for skills, gender, age, and background incorporated into director selection processes.

Shareholder Note: Temporary non-compliance with governance codes is material; however, management assures timely rectification. Investors should monitor Board appointments and governance updates closely.

Conclusion

Investors should closely monitor developments in HGH Holdings’ core and new business segments, as well as Board composition. The dramatic turnaround in the ready-mix concrete segment, full impairment of the PHH investment, strategic entry into agri-tech, and the PCPL divestment are all significant events that may influence the Company’s future performance and share value.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own research or consult a professional advisor before making any investment decisions. The information is based on publicly available documents and may be subject to change.

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