D&L Industries will move the start of commercial operations (SCO) of its Batangas plant, after getting approval from the Philippine Economic Zone Authority (PEZA). This was in consideration of the delays in processing permits and certifications as well as the late arrival of shipments from various overseas suppliers as affected by the global supply chain disruptions. While PEZA has granted an extension until the end of 2023, providing allowances in case of a force majeure, D&L's management is committed to start commercial operations by mid-2023.

D&L's Batangas expansion sits on a 26-ha property in First Industrial Township - Special Economic Zone in Batangas. The ongoing expansion, also referred to as Phase 1, will occupy about 16ha. As of end-October, the company has so far spent about PHP 8.6 billion for the project.

Remaining capex to be spent this year and early next year stands at about PHP 1.6 billion. In September 2021, the company executed its maiden bond offering, successfully raising PHP 5 billion to help fund the remaining capex for this expansion. The bonds carry a coupon rate of 2.7885% p.a. and 3.5962% p.a. for the 3-year and 5-year bond, respectively, which are among the lowest rates in Philippine corporate bond history.

Once completed, the new plant will be instrumental to the company's future growth, in line with plans to develop more high value-added coconut-based products and penetrate new international markets. It will mainly cater to D&L's growing export business in the food and oleochemicals segment. It will add the capability to manufacture downstream packaging, thus allowing the company to capture a bigger part of the production chain.

For instance, while the company primarily sells raw materials to customers in bulk, the new plants will allow it to "pack at source". This means that D&L will have the ability to process the raw materials and package them closer to finished consumer-facing products. This will enable D&L to move a step closer to its customers by providing customized solutions and simplifying their supply chain, which is of high importance given ongoing global logistical challenges.