Kuala lumpur: Local ammunition production company Ketech Asia Sdn Bhd plans to strengthen its product portfolio and revenue streams with the introduction of two additional calibres, namely the 7.62 millimetre (mm) and 12mm rounds next year, as part of its broader growth and capacity expansion strategy. Its project director Rahayu Bahaudin said the move reflects the company's focus on scaling its small arms segment while carefully assessing return on investment (ROI) amid ongoing efforts to build a more resilient and cost-efficient production base.
According to BERNAMA News Agency, the company is aware that the supply chain for raw materials is not available in Malaysia as there are no industry players supplying them. Rahayu emphasized that the ecosystem for raw material procurement is lacking, necessitating imports from outside Malaysia. Ketech Asia operates the country's first highly automated ammunition manufacturing facility in Kuala Lipis, Pahang, currently producing up to 130 million rounds of 9mm and 5.56mm ammunition annually for the domestic market.
The manufacturing of standard small arms ammunition relies heavily on three vital raw materials: brass for cartridge casing, a primer for initial ignition, and propellant (gunpowder) to generate explosive gas pressure. Rahayu indicated that while Ketech Asia sources supplies from local companies, those companies still import from overseas, leading to rising costs due to logistics, especially amid ongoing conflicts.
Ketech Asia primarily imports raw materials from China and Turkiye, while exploring other sources to avoid overdependence. For exports, the company is prioritizing the domestic market to achieve self-reliance before expanding to other countries. There have been inquiries from regions such as the Middle East, Thailand, Singapore, and the Philippines.
Amid the ongoing conflict in West Asia, logistics costs have risen, increasing overall expenses for Ketech Asia, which must absorb these costs despite fixed selling prices to the government. Demand for ammunition could reach about 100 million rounds per shipment.
Rahayu also mentioned that Ketech Asia aims to become a leader in ASEAN military technology by 2030, with significant milestones already achieved since opening its ammunition factory in late 2024. The company's expansion plans for its Kuala Lipis manufacturing hub aim to create more job opportunities for Bumiputera, especially in areas outside major cities.