Hon Chuan Sees 12-fold Revenue Growth in 12 Years

Taipei, Aug. 21, 2012 (CENS)--When ROC President Ma Ying-jeou, accompanied by officials of Ministry of Economic Affairs (MOEA), visited the Hon Chuan Group’s bottling plant in Taichung recently, the company’s CEO, S.Z. Tsao, told the President that Hon Chuan’s revenues had increased 12-fold since its stock market listing 12 years ago. This year, he said, the group’s revenues will challenge NT$18 billion (US$600 million), and the target for 2015 is NT$30 billion (US$1 billion).

The Hon Chuan Group was founded 30 years ago with a capitalization of only NT$6 million (US$200,000). It is now Taiwan’s largest bottler, and the third-largest supplier of beverage packaging in China, with a capitalization of more than NT$2 billion (US$66.67 million).

President Ma noted that although Taiwan exports massive amounts of products, exports that come under free trade agreements (FTAs) amount to less than 5% of the total. For South Korea and Singapore, by contrast, 40% and 70% of exports, respectively, are shipped under FTAs and are therefore subject to zero or steadily declining tariffs. Taiwan’s government, the Present stated, is eager to sign FTAs with other countries and join the Trans-Pacific Partnership (TPP) so that more of its products, too, can enjoy preferential import treatment.

Tsao reported that Hon Chuan currently has 12 bases in Taiwan, where it as a market share of approximately 80%, along with 16 plants in mainland China and nine in Southeast Asia. It set up its 2nd bottling plant in Taichung and a beverage packaging plant in Vietnam in the first quarter of this year.

An institutional investor noted that with record high revenues in July and the opening of a new beverage packaging plant in Malaysia, Hon Chuan’s revenues and profits are both expected to grow 15~20%, yielding earnings per share (EPS) of NT$5.5~6 (US$0.183~0.02).