SUZHOU, Jiangsu –TK Group (Holdings) Ltd. (TK), a Hong Kong-based custom plastics company, plans to open a new molding facility in Suzhou, Jiangsu Province later this year, according to a report by Plastic News on March 27.
With the new plant, TK plans to expand its mold-making capabilities in China, as it sees growing sales from the car industry. It reported that sales rose 9 percent to HK$1.2 billion ($160 million) in 2013, mainly attributing to a sizable increase in sales of molds to the automotive industry.
TK, a publicly traded company, disclosed the investment on March 25 in its annual financial report, but the company did not disclose the size of the new investment in the Suzhou molding plant. The company said it rented the new facility early this year and will start production in the second half of the year. The Suzhou facility will be the smaller one of TK’s two production bases in China, and the company expects the new plant will boost its capacity there by 50 percent.
It is reported that TK also plans to set up new units making ultra-large molds for the auto industry and higher-end molds for the electronics industry.
“In view of the gradual recovery of global consumer confidence, the management believes that the market has passed through the downturn and will slowly revive,” the company spokesman said. “The total production value of high precision plastic injection molds and plastic components is expected to maintain its upward trend, which favors the group’s development prospects.”
“The group remains prudent yet optimistic about its prospects for 2014,” TK said. The company’s profit, however, did not match its increase in sales. TK’s profit fell 10 percent to HK$121.3 million.
According to the company, TK’s sales growth essentially came from its mold making unit, which saw sales jump 33 percent to HK$476 million on much larger demand in the automotive industry. Sales in its plastic molding division fell 2.4 percent to HK$721.8 million.
TK, which employs 2,900 people and has its largest production base in Shenzhen, plans more efforts to find acquisition targets in the mold making industry.
“We will also actively seek other mold fabricators who suit the scale of the group and generate synergies for potential acquisition to facilitate the group’s business expansion and enlarge its market share globally,” the company said.
It raised approximately HK$365 million through its public listing on the Main Board of the Stock Exchange of Hong Kong on 20 December 2013.
TK Group (Holdings) Limited celebrated its public listing on H Stock on 20 December 2013.