Xinyi heeds mobile call as orders boom

Xinyi Glass (0868) will start making ultra-thin electronic glass for mobile phone screens in the second half of next year.

"We expect to see steady growth during the rest of this year," chief executive Tung Ching-sai told The Standard. "Our four main products will continue to benefit from mainland policy and a strong export market."

Demand for glass is estimated to soar as the mainland completes building of 10 million affordable housing units by the end of November.

Its order books for automobile glass - the biggest contributor to first-half revenue - are all filled up until next month.

Total revenue in the first six months of the year almost doubled to HK$3.88 billion from a year back while net profit soared by 31.2 percent to HK$832 million. Float glass, commonly used in buildings, saw prices decline from 1,970 yuan (HK$2,387.82) per tonne in 2010 to 1,696 yuan as at June 30.

"Turnover of solar glass has hit a record high, and we will see more capacity in the second half as two more production lines are being added in the third quarter,"said Tung.

The spinoff of its solar unit is progressing, but Tung gave no details. Xinyi Solar is expected to raise up to US$300 million (HK$2.34 billion).

"We will be more cost effective and introduce a low temperature recycling heat power system, which could save HK$100 million,"said Tung.

For the third quarter Xinyi Glass has locked raw material costs in at 30 percent of total costs - similar to the second quarter.