The group contributes between 55% and 60% of earnings and is a core business of IOI Group. The group engaged in cultivation and processing of palm oil, the operations are in full spectrum from the seed breading and planting to crop oil extraction to the downstream activities. The latest plantation milestones are they successfully attained International Sustainability & Carbon Certification (ISCC) apart from roundtable on sustainable palm oil (RSPO) certified. Besides, the group also have acquired new palm oil mills and estates from Unico-Desa Plantation Berhad. This new mills and estates are expected to turn up in the near …show more content…
The expansion will be funded by the cash flow generated by the Group from the plantation and resource-based manufacturing segment, as announced by the newly appointed Datuk Lee Yeow Chor. For the upstream segment, IOIC plans to spend a total amount of RM 236 million for the expansion of its plantation business activities in Malaysia and Indonesia over the next 3-4 years. Besides that, the Group also plan to further expand its land bank in the Southeast Asia. Meanwhile, for the downstream segment it will expand the capacities into niche and higher value-added sectors. IOIC will continue to build its downstream resource-based manufacturing business located worldwide such as Netherland, US, China, Canada and also Malaysia. For example, it is plans to have the first specialty fats plant operate in Xianmen, China in the fourth quarter of 2015. As the investment for the future expansion plan involved a huge amount of cash flow, IOIC requires a proper planning to prevent the failure of its expansion. Any failure from the investment will lead to serious consequence towards the Group. Hence, suggestions are provided in the following section in accordance with the Ferreira & Otley Framework to assist IOIC to overcome its current issues. ( ) (