Overseas tire market demand is strong, Jiangsu General Science Technology expects to increase performance by 364.86% - 416.51% YoY in the first half of this year. In 2024, the company will continue to improve its overseas production capacity, and plans to adjust its product structure based on the expansion project of high-performance radial tires in Thailand. The second phase of the project will have an annual production capacity of 10 million semi-steel radial tires.
On July 8th, Cailian Press (Reporter Xiao Lianghua) reported that thanks to the strong demand of the overseas tire market combined with an accelerated release of overseas production capacity, Jiangsu General Science Technology (601500.SH) achieved a significant increase in tire production and sales in the first half of this year. The company expects to increase its performance by 364.86% - 416.51% YoY in the first half of this year.
Overseas factories have become the main source of profit for many domestic tire listed companies due to factors such as low labor costs and tax incentives. In the first half of this year, the overseas production capacity profitability of domestic tire industry listed companies was generally good. "Jiangsu General Science Technology's overseas production capacity is relatively low, so the increase is significant. With the further release of the company's overseas capacity at both the Cambodia and Thailand bases, the company's performance has greater elasticity," said a tire industry observer to Cailian Press.
Jiangsu General Science Technology announced tonight that the company expects to achieve a net income attributable to shareholders of 0.27 billion yuan - 0.3 billion yuan in the first half of 2024. In the first half of this year, benefiting from the growth in domestic auto industry production and sales and strong overseas tire market demand, the company accelerated capacity release based on the overseas Cambodia and Thailand bases, achieving significant growth in tire production and sales. At the same time, the company continues to promote quality improvement and efficiency enhancement, achieving profit improvement.
Jiangsu General Science Technology benefits from the tire industry's going global strategy. In 2019, the company invested in building its first overseas production base in Thailand. Currently, the company's Thailand factory Phase 1 project has completed production, and the second overseas production base, Cambodia factory, started production in May 2023. As of the end of 2023, the company's ongoing projects include Cambodia Phase 2, Thailand Phase 2, and semi-steel and off-road tire projects in the Wuxi factory.
In 2024, Jiangsu General Science Technology will continue to improve its overseas production capacity. In August 2023, the company announced an investment of 1.884 billion yuan to implement the expansion project of high-performance radial tires in Thailand, including 500,000 all-steel radial tires and 6 million semi-steel radial tires. In June 2024, the company issued an announcement to adjust the above-mentioned production expansion plan and plans to adjust its product structure based on the expansion project of high-performance radial tires in Thailand. The second phase of the project will have an annual production capacity of 10 million semi-steel radial tires.