Yong Feng Yu invests 1 billion to expand its paper factory in Vietnam
Yong Feng Yu, considering the evolving trends in the medium to long-term international economic and trade landscape, has decided to increase its investment by nearly 1 billion to participate in the proposed capital increase for its industrial paper and paper products business.
In light of the medium to long-term changes in the international economic and trade situation, Yong Feng Yu (YFY) has decided to increase its investment by nearly 1 billion to participate in the proposed capital increase for its industrial paper and paper products business. According to information available, there are two main focuses. First, in line with the ‘Mainland Plus One’ strategy, the company aims to expand the operation scale of its paper factory in Vietnam to seize the opportunities arising from the global shift of manufacturing industries to the south. Second, the company plans to enhance overall production efficiency in Taiwan and Vietnam, moving towards low-carbon, low-energy consumption, and smart manufacturing to continue expanding its market presence.
The industrial paper and paper products business contributed over 40% to YFY’s revenue in the first three quarters, making it a significant part of the company. Currently, the company has production and sales bases in both Taiwan and Vietnam. Given the increasing geopolitical tensions, the long-term growth potential in Vietnam is promising. Last year, the company established two new paper packaging companies, YFY Packaging (Nghe An) and YFY Packaging (Quang Ngai). Following the company’s tradition, it is speculated that at least two new paper factories will be established in Vietnam in the future.
During the analyst conference on the 14th, CEO Luo Bingzheng pointed out that the short-term economic downturn in Vietnam does not affect the overall economic growth trend, and the company remains optimistic about the medium to long-term prospects. The customer industrial clusters in Northern and Southern Vietnam are different, with Southern Vietnam being dominated by Taiwanese businesses and diverse industries, while Northern Vietnam focuses mainly on export and technology industry customers. YFY’s industrial paper will meet the needs of different customers and create distinctions.
As for the Chinese industrial paper and paper products market, after the price increase actions in September and October, terminal selling prices have risen, downstream inventories have been cleared, but whether this trend will continue needs further observation. The market share of industrial paper in Taiwan has not changed significantly. Besides paper boxes, YFY continues to optimize its product portfolio to improve resource efficiency.
YFY’s industrial paper revenue declined by about 10% in the first three quarters, with a low single-digit decline in revenue from Vietnam and a 10% decline across the Taiwan Strait.
Currently, YFY’s industrial paper segment in Taiwan consists of one paper mill and six paper product factories, making it one of the top three paper mills in Taiwan. In Vietnam, the company has six paper product factories, making it the largest paper box supplier in the country. The company is well-prepared with financial resources, and once demand becomes clear, it will establish new paper product factories. In mainland China, YFY has one paper mill and twelve paper product factories.
In the first three quarters, YFY faced a sluggish overall economic recovery, conservative consumer spending, and incurred a loss of 463 million in its core business. However, the main contribution to its income, around 2.293 billion, came from external investments. This was primarily due to the recognition of investment income benefiting from investments in companies like YFY Inc., and the inclusion of dividends from affiliated businesses such as Yong Feng Bank. The consolidated net profit after tax was approximately 1.327 billion, with earnings per share after tax being 0.8.”
Source：Yahoo 新聞｜Link
Visit our service｜Link
