Shinkong Synthetic Fibers Corp. said Saturday that it planned to expand production in Thailand on expectations that demand for artificial fiber would increase from quarter to quarter this year.
Shingkong Synthetic Fibers, one of Taiwan's leading textile suppliers, said it aimed to expand production capacity of polyethylene terephthalate (PET) bottle-grade resin at its Thailand plant by 10-20 percent as the artificial fiber industry was expected to experience a better second half of the year than the first.
The Taiwanese company's subsidiary in Thailand started operations in 1997. It has also operated production lines in Taiwan and China.
Shinkong Synthetic Fibers said the business of artificial fiber, including PET bottle-grade resin, has showed signs of recovering since May and is expected to grow for the rest of this year.
Currently, the Thailand plant produces 15,000 metric tons of PET bottle-grade resin a month, and all of the products are sold in the Thai market. Taiwan's production lines churn out 30,000 metric tons of PET bottle-grade resin a month for both local and overseas markets.
Earlier this year, Shinkong Synthetic Fiber Chairman Wu Tong-sheng said that with the global economy on the way to recovery, the inventory level in the China market has been on the decline, adding that his company was likely to see its bottom line improving later this year given such favorable conditions.
In 2012, Shinkong Synthetic Fiber posted NT$1.42 billion (US$47.33 million) in net profit or NT$0.55 per share, compared with NT$1.59 billion or NT$0.71 per share recorded in 2011.
In the first quarter of 2013, the company's EPS stood at NT$0.11, up from NT$0.04 registered over the same period of last year.
The textile maker is now looking beyond the artificial fiber business, aiming to enter the telecom industry. It has filed an application with the government to bid for a license to operate the 4G telecom network in Taiwan.
A total of seven business groups, including Shinkong Synthetic Fiber, Hon Hai Group, Chunghwa Telecom, Taiwan Mobile and Far Eastone Telecommunications, are competing for 4G licenses in an upcoming auction.
Wu said if his company secured a 4G license, it would begin to set up base stations in 2014, expecting its 4G network to become operational in the second half of 2015. He said the company could break even in 2017 and start to reap profits in 2018 at the earliest.
According to Shinkong Synthetic Fiber, the 4G operations are expected to cost the company about NT$20 billion, including the NT$4 billion-NT$5 billion expenditure to build no less than 3,000 base stations.
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