Xinyi budgets HK$3b to raise capacity by 70pc
Xinyi Glass Holding, the mainland's biggest vehicle glass exporter, will boost production capacity by almost 70 per cent by 2010 through a HK$3 billion expansion plan.
The company also will cut costs by acquiring mines for silicon sand, the raw material for glass.
'The demand from the automotive industry is so big that we have to expand our production lines,' said chairman Lee Yin-yee, after the signing of a HK$500 million syndicated loan yesterday.
China was expected to account for more than 50 per cent of global glass consumption in the near future, the company said.
Mainland glass demand will grow at between 12 per cent and 15 per cent annually, compared with just 2 per cent to 4 per cent globally.
The company, which achieved a 114 per cent surge in first-half net profit, plans to increase vehicle glass capacity to 15.5 million sheets a year by 2010 from 9.2 million sheets.
It will expand its Guangdong production line for float glass, the raw material for vehicle glass. The company has plants in Shenzhen, Dongguan, Wuhan and Tianjin.
To gain from new environmental rules requiring buildings to include energy saving functions, the company will boost production of low-emission coated construction glass by 6.5 times to 12 million square metres by 2010.
'We want to do acquisitions to save costs,' Mr Lee said. 'We are looking for silicon sand mines in Guangdong, Hainan and Anhui that are transport accessible.'
The company plans to acquire controlling stakes in several mines in 20 months for a budgeted investment of HK$150 million. The targets will have aggregate production of 1.5 million tonnes of sand a year.