UNDETERRED by the ban on new property projects and the slowdown in the motor vehicle industry, Shanghai Yaohua Pilkington Glass (SYP Glass) is working out plans for an expansion that will cost about US$100 million.
The plans are being drawn up even though the Sino-British manufacturer of high-quality float glass, which raised $72 million through a B-share issue to foreigners a year ago and is listed on the Shanghai stock exchange, will start operating a second production line in November.
'We are actively examining the next stage of expansion, which will be a third float glass production line,' said Asia Pacific vice-president Terry Ginty.
'The investment in the third line will be of a similar order of magnitude [as the first two lines], possibly about $100 million in capital cost.' Mr Ginty said that there was no specific date for the setting up of the third line but added that it would take about two years to build it after formal approval.
He hinted that SYP Glass would resort to a mixture of financing arrangements to fund the expansion but declined to elaborate.
Analysts said that one option would be to borrow from the banks as SYP did not have a high debt ratio.
When the second line, costing between $80 million and $85 million, becomes operational in November, SYP Glass's output of clear float glass will rise to 300,000 tonnes a year from 180,000 tonnes.