Anhui Conch Cement Co Ltd, a mainland cement producer, expects to double its production capacity from 86.5Mt in 2007 to 173Mt in three to five years, the company’s executive director Guo Jing-bin said. Guo told a press briefing today that the company plans to invest CNY46bn in capital expenditure during the next three years to achieve the capacity target. However, its CAPEX plan for the period will be subject to its capability in raising up to CNY12bn via the issue of an additional 200m A-shares in the mainland bourse. The company expects to increase its capacity to 100Mt this year. Company chairman Guo Wen-san told the same press briefing that capex for this year will be 7.0 bln yuan, mainly for power projects. "Anhui Conch hopes it can issue additional A-shares in the next six months. But its expansion plan for this year will not be significantly affected even if it fails to raise funds from the A-share market," Guo Wen-san said.
Meanwhile, Guo Jing-bin expects further upside for cement prices in the future, noting a 9.2 per cent year-on-year rise in Anhui Conch’s product prices in the first quarter, compared with a six per cent rise in full-year 2007. "I am confident that higher cement prices could offset higher costs," he said.