Hainan Rubber to Raise 29.52 Billion Yuan for Expansion, Boosting Production Capacity

Hainan Rubber, a leading manufacturer of giant full-steel engineering radial tires, has successfully navigated the listing review by the Shenzhen Stock Exchange. The company, with Guotai Junan Securities as its sponsor, is poised to raise 29.5232 billion yuan through its initial public offering (IPO). The funds will be directed towards expanding its full-steel engineering radial tire production capacity, upgrading its automated production lines, constructing a research and development center, and supplementing working capital.

The expansion project aims to bolster Hainan Rubber's production capabilities, enabling the company to meet the increasing demand for high-performance tires in the engineering and mining sectors. The upgrade of automated production lines will enhance efficiency and reduce operational costs, while the new research and development center will focus on innovation and the development of advanced tire technologies.

Hainan Rubber's core business revolves around the research, development, production, and sale of giant full-steel engineering radial tires, as well as the management of mining tires. These tires are high-end products characterized by their large size and weight, harsh working conditions, and long periods of continuous operation. The production of these tires requires advanced technology, and only a few tire manufacturers globally have achieved large-scale production.

As a leading enterprise in China's full-steel tire industry, Hainan Rubber has achieved mass production of all specifications of full-steel giant tires, breaking the monopoly of international brands and achieving domestic substitution. Since its establishment in 2005, the company has focused on the research and development of full-steel giant tires, steadily growing over the years. It now possesses the technology and capacity to produce a full range of full-steel giant tires (with rim diameters of 49 inches and above), serving over a hundred mines both domestically and internationally.

From a financial perspective, Hainan Rubber reported revenues of 23.00 billion yuan, 22.51 billion yuan, and 15.08 billion yuan for the years 2024, 2023, and 2022, respectively. During the same periods, the company's net profit attributable to shareholders was 6.79 billion yuan, 6.54 billion yuan, and 3.54 billion yuan, respectively.

Despite the high technical barriers in the full-steel giant tire industry, the market competition is expected to intensify as more domestic tire manufacturers enter the field. Hainan Rubber faces risks related to product quality and the need to keep up with market demands through continuous innovation. If the company's products encounter significant quality issues or fail to meet market needs due to insufficient research and development capabilities, its business could be at risk of being replaced by competitors.