Shares of Jinfei Kaida Wheel surged following the Chinese manufacturer's announcement regarding its third capacity expansion plan this year. Jinfei Kaida revealed its intention to invest CNY557 million (USD77 million) in constructing a new plant in Thailand's Thai-Chinese Rayong Industrial Zone.
About the new plant
This facility will focus on producing two million aluminium alloy wheel hubs annually, specifically for new energy vehicles. The Jinhua-based company shared that the plant's construction is expected to be completed within two years.
According to the firm's announcement, the new plant is projected to generate annual sales revenue of CNY578 million and an estimated profit of around CNY95.6 million (USD13.2 million) upon reaching its designed capacity.
The new plant is expected to enable Jinfei Kaida to leverage the benefits of having an overseas production base and market channels. The company stated that this move aims to enhance the company's ability to meet the demands of both international and local markets and optimize its product portfolio.
Two additional capacity expansions
Earlier this year, Jinfei Kaida unveiled two additional capacity expansion initiatives within China, responding to the rising demand from the New Energy Vehicle (NEV) market, favouring lighter components for energy efficiency. The company invested CNY538 million to establish factories with a combined annual production capacity of 2.4 million automotive aluminium alloy wheel hubs. These factories will be located in the eastern Anhui province and the southwestern Yunnan province.
Jinfei Kaida primarily supplies customized aluminium alloy wheel hubs to automobile and motorcycle manufacturers while also offering replacement parts for various international markets. According to its 2022 annual earnings report, revenue from the auto wheel hub business accounted for 52 per cent of the total revenue that year. Additionally, overseas sales revenue constituted 34 per cent of the total revenue.
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