Mainland construction and property firm Baoye Group is in talks with several Japanese companies over technology transfer and outsourcing for pre-fabricated building materials, according to its chairman. In an interview with the South China Morning Post, Pang Baogen said the Zhejiang-based company had been in talks with Daiwa House Industry, Sekisui House and a construction unit of Toyota on possible manufacturing co-operation. Talks with Daiwa House were at the most advanced stage, Mr Pang said. The Japanese firms are interested in offloading more labour-intensive manufacturing processes to the mainland, while Baoye hopes to benefit from their advanced technology. Mr Pang said Baoye wanted to retain shareholding control over any co-operative ventures. Last week, the firm reported an 85.94 per cent year-on-year rise in net profit to 151.17 million yuan for the first half. Turnover rose 83.6 per cent to 2.24 billion yuan. Property development accounted for 52.92 per cent of operating profit, up from 13.38 per cent last year, while construction fell to 40.88 per cent from 64.05 per cent and building materials dropped to 5.97 per cent from 13.38 per cent. First-half operating profit margin of its property business was 43.67 per cent, against 4.36 per cent for construction - down from 6.43 per cent last year.