Steel-maker Tang Meng Rath thrives with support of ACLEDA

Content image - Phnom Penh Post
Tang Meng Rath founder and CEO Taing Hovpuy. Hean Rangsey

Special corporate ties bind Tang Meng Rath Investments and ACLEDA Bank. Cambodia’s oldest steel pipe and zinc distributor Tang Meng Rath boasts a sustainable business model for growth, while ACLEDA has a mission of providing capital to nurture local companies.

For the past 16 years, Tang Meng Rath has used the bank’s financing to scale up its business.

And the partnership continues to work smoothly.

“While there are many banks in Cambodia, we have been happy using ACLEDA’s services for the past 16 years because our partnership has been successful as they understand our business needs.

“There is a mutual understanding between us. Without this understanding, we cannot do business, and ACLEDA Bank knows our business very well,” said Taing Meng Rath founder and CEO Taing Hovpuy.

Established in 1991, Taing Meng Rath started by grinding steel manually, before venturing into pipe and zinc production in 2000.

Content image - Phnom Penh Post
Tang Meng Rath is Cambodia’s oldest steel pipe and zinc distributor. SUPPLIED

And in 2005, the company borrowed capital from ACLEDA Bank to purchase raw materials from Singapore, Taiwan and China to produce its own pipes and zinc, which helped it expand business operations.

The capital injection from ACLEDA Bank helped the company to compete and grow in the domestic market, with demand for its products rising as construction projects in the capital mushroomed.

The home-grown company currently has 23 sales outlets in 23 provinces selling steel pipes and zinc, mostly for the construction of houses, factories and warehouses.

Employing more than 100 workers at its factory in Phnom Penh and with some 200 external distributors, Taing Meng Rath is contributing to socio-economic development and poverty reduction in the Kingdom through job creation.

“I am proud to have provided employment for Cambodians, including allowing them to sell steel in the provinces for themselves. We help them, so if we have any emergency needs, they will help us in return,” said Hovpuy.

Access to financing is often a critical constraint in the SME sector, one that can stifle their growth, but for Taing Meng Rath the timely injection of funds was beneficial.

Content image - Phnom Penh Post
ACLEDA has helped with the company’s expansion. SUPPLIED

And ACLEDA – firmly in accordance with its motto of “the Bank You Can Trust, the Bank for the People”– rolled out strategies to help the business sector during the turbulence of the Covid-19 pandemic.

It was one of the pioneer banks to join the government-initiated Credit Guarantee Corporation of Cambodia, which was established to support businesses such as micro, small and medium enterprises, and even large companies.

Borrowers can avail of financial support from Participating Financial Institutions (PFIs) for investment, business expansion and working capital.

CGCC’s guarantee will act as collateral or security for 70 to 80 per cent of the loan amount borrowed from the PFIs – thus reducing the physical collateral required from borrowers.

Hovpuy said ACLEDA’s support proved invaluable as Taing Meng Rath successfully navigated the tribulations brought about by Covid-19.

“Businesses like Taing Meng Rath Investment suffered with the pandemic, with many companies facing difficulties.

“But ACLEDA Bank stepped in to help us during these tough times, and our company has continued to operate without interruptions,” he said.