Tire Maker Cheng Shin Reports Higher Revenues for 2012

Cheng Shin Rubber Ind. Co. Ltd., a major tire manufacturer in Taiwan with global manufacturing sites, recently reported consolidated revenue of NT$134.5 billion (US$4.48 billion) for 2012, up 16% from the previous year and a record high for the company.

With prices of natural rubber to stay low this year, and strong demand for car tires in China to continue, some institutional investors forecast that both Cheng Shin's revenue and earnings will continue to grow about 20% in 0213.

Cheng Shin has been in business in China for some time and set up a big factory there in 2009 to further expand capacity, also having moved up to No. 9 in global ranking in 2012.

The company attributes its high revenue growth last year to strong demand from China, India and other emerging markets. In 2013, Cheng Shin said that automobile production in China is expected to increase to some 20 million units, creating a huge demand for tires.

Both Cheng Shin's own "Cheng Shin" and "Maxxis" brands have won the honor of "Chinese Well-known Mark" in China, and the tire maker said that it will continue to adopt the multi-brand and -channel marketing strategy for developing sales in the huge Chinese market, as well as adjust production capacity according to market demand.

Cheng Shin inaugurated several new factories in 2012, including those in Chongqing (Sichuan Province), Xiamen (Fujian Province), and Zhangzhou (Fujian Province) in China, as well as Douliou of central Taiwan.

Some institutional investors estimate that Cheng Shin is expected to achieve revenue of about NT$150 billion (US$5 billion) and net earnings of NT$18 billion (US$600 million) in 2013.