Great Wall scales up growth by planning a domestic float

GREAT Wall Motor Co plans to sell shares domestically to fund the development of new diesel engines, expand its technical centers and establish a testing center.

The company is expected to issue up to 121.7 million A shares on the Shanghai Stock Exchange, representing 11 percent of its existing share capital, the nation's largest maker of sport-utility vehicles and pick-up trucks told the Hong Kong Stock Exchange yesterday.

Great Wall didn't spell out a timetable or specify a price for the shares. The share sale depends on government approval.

The money derived from the listing will be used to fund a total 2.75 billion yuan (US$367 million) investment in the coming years, including making 100,000 sets of automatic transmissions costing 530.9 million yuan.

Great Wall also plans to expand its technical center with 742.9 million yuan. Other projects included setting up a testing center, and developing new high-performance diesel engines and sport-utility vehicles.

Great Wall, based in Baoding, Hebei Province, also pledged to expand to its range to include mid-to-high-class sedans as it aims to enter the high-end automobile market for better profitability and international competitiveness, according to the statement.

Half-year car sales of the company reached 47,665 units, an increase of 23.8 percent year on year. Amid brisk car sales, gross profit climbed 22 percent to nearly 800 million yuan during the same period from a year earlier.

Great Wall now operates 20 subsidiaries and has 10,000 employees.

Its annual production capacity is 400,000 units, covering the full range of passenger cars, pickups, SUVs and MPVs, the company's Website says.

Aside from the domestic market, Great Wall is also making inroads into overseas markets.

It has eight overseas production centers in countries such as Russia, Vietnam, Iran and Egypt. It plans to double its overseas plants by the end of this decade to boost sales abroad.

Great Wall exports to more than 50 countries and regions including the Middle East, South America and North Africa, with first-half exports valued at 1.13 billion yuan.