① At the 2023Q3 performance briefing, the relevant person in charge of Sailun Tire said that the company currently has sufficient orders, and domestic and foreign factories are making good use of production capacity. ② In September and early November, the prices of the company's all-steel tires were raised by 2-3% and 3% respectively, and the prices of semi-steel products were raised by 3-5% from September 27, which can effectively reduce the impact of rising raw material prices on the company's profits.
Financial News Agency, November 7 (Reporter Xiao Lianghua)After the third-quarter results hit a new quarterly high, the stock price of Sailun Tire (601058.SH) did not rise but fell, causing investors to worry. At the results meeting for the third quarter of 2023 held today, the relevant person in charge of the company responded: “Orders are still sufficient, and recently the company has raised prices for major products several times to cope with the rise in raw materials.”
In response to investors' concerns about the order situation, Li Jiqing, director of Sailun Tire, said that the company currently has sufficient orders, and domestic and foreign factories are making good use of production capacity. In recent years, with the continuous increase in car ownership, demand for tires has been increasing year by year. Since this year, domestic economic activity has clearly resumed, and the negative impact of foreign tire inventory removal has also gradually been eliminated.
Prices of natural rubber and carbon black rose sharply in September-October, and tire companies faced cost pressure. In response, Li Jiqing said that with regard to changes in raw material prices, in addition to formulating corresponding procurement strategies according to each factory's raw material demand plan, the company will also respond through product price increases, cost reduction, and efficiency.
He explained that the company has raised the prices of domestic all-steel products by 2-3% and 3% respectively since September 20 and November 1, and the prices of semi-steel products have been raised by 3-5% since September 27, which can effectively reduce the impact of rising raw material prices on the company's profits. “At present, the cost side does not have much impact on the company. In the future, the company will also determine product prices and sales policies based on factors such as raw material prices and market conditions.”
In terms of production capacity, Liu Yanhua, chairman of the company, said that up to now, the company has planned 25.4 million all-steel tires, 88 million semi-steel tires, and 380,000 tons of off-road tires. Of these, with the exception of Cambodia's annual production of 6 million semi-steel and Dongjiakou factories (10 million all-steel, 20 million semi-steel) and 150,000 tons of off-road tires, other projects will be completed or basically completed within 2023. It is expected that production capacity will increase compared to the beginning of the year.
Regarding the “top” Dongjiakou factory project in the planned production capacity, Li Jiqing further added that the company's Dongjiakou New Materials and Dongjiakou project have completed the project filing. At present, the company has signed relevant land contracts with the local government and is actively coordinating with government departments to process construction permits and other formalities.