XingQuan (5155) is the first company from China to be listed on Bursa Malaysia. The group is involved in the manufacturing of shoe soles, apparels & accessories. Currently, its products are sold via 1,596 points of sales across China.
Picture taken: http://www.xingquan-international.com/images/store.jpg
XingQuan is constructing a new factory with production floor area of approximately 55,000 sq metres and it is expected to completed in 2011. Upon completion, the production capacity for shoes and shoe sole products to increase to approximately 10.0 million (now is 5.9 million) and 28.0 million (now is 14.0 million) pairs per annum.
As we can see from the table above, the production capacity is almost there. After the completion of the new factory, we can assume that the revenue also will be double up in the coming few years.
China is going to have 1.41 billion people in year 2012. From the huge population and rapid economic growth creates a growing emerging middle class. I can forsee there will be more and more people afford to buy sport shoes.
It is reported that China's middle class increased by 22.1% to 80 million is January 2007, from 65.5 million in January 2005 and this segment of middle class is expected to increase to 700 million by 2020.
Based on research conducted by Converging Knowledge Pte. Ltd, the growth rate estimation ranges from 11.7% to 15.8* as the CAGR for China;s sportwear market and ranges from 27.0% to 42.0% as the CAGR for China;s outfoor sportwear market from 2008 to 2012.
Source: Xingquan International Sports Holdings Limited Annual Report 2009
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