Shanghai – China’s tire maker Jiangsu General Science Technology went public on the Shanghai Stock Exchange in an 861 million yuan (€116 million) IPO on 19 Sept.
Capital raised will be pumped into its TBR facility with 1 million unit annual capacity with €102 million investment planned – the second phase of a 2 million unit project – and a new research centre. Both will be constructed at the company’s base in Wuxi, Jiangsu.
Domestic tire makers take up the majority of China’s TBR market thanks to their price value, according to General Science’s prospectus. The company, one of the country’s market leaders in short-distance industrial mining tires, looks to obtain a more balanced portfolio covering mid- to short-distance and mid- to long-distance products.
Besides 3 million unit current TBR capacity, the company also has 1.7 million unit annual capacity for bias tires, 6 million for motorcycle tires and 5 million for tire tubes. TBR tires bring in roughly 85 percent of its annual revenue.
Ranked by China Rubber Industry Association as the country’s 18th largest tire maker in sales, in 2015 General Science saw its revenue drop by 8 percent year on year to €432 million; net profit declined by 21 percent to €21.5 million.
“The falling of natural rubber prices led to a downturn in the company’s product price,” said the prospectus.
With business picking up over the first six months of 2016, the company expects slight increases in revenue this year to roughly €450 million and a larger gain in net profit to about €26 million.