Bloomberg reports that Vitasoy International Holdings Ltd., a soy milk supplier to Starbucks Corp., will invest about 300 million yuan ($44 million) to double its capacity in China and tap increasing demand for packaged beverages.Vitasoy will build a new factory in Nanhai to meet rising demand in southern China, where business “has grown so strongly,” Chief Executive Officer Larry Eisentrager said in a Bloomberg TV interview today. He declined to provide further details as negotiations for the factory are still pending.
The beverage maker, which started in Hong Kong 1940, sells its products in more than 40 markets including the U.S., China, Europe, Australia and New Zealand. Soy milk made up 44 percent of Vitasoy’s sales for the year ended March, 2009.
“Vitasoy’s been too conservative in expanding in China and it isn’t offering much product variety to Chinese consumers,” Francis Lun, general manager at Fulbright Securities Ltd., said in an interview in Hong Kong. “It has a very well-established brand and it should be moving more aggressively in China to gain market share.”
The company’s shares have risen 71 percent over the past year.
Vitasoy expects to derive 28 percent of sales from China this fiscal year, compared with 15 percent a year earlier, Eisentrager said in Hong Kong.
“When you have a niche category, and that’s what soy is, it can be a growing niche and we focus on it,” Eisentrager said. “We don’t have the vision of world domination.”
Vitasoy’s net income in the six months to September rose 46 percent to HK$141.1 million ($18 million). Sales rose 8.6 percent to HK$1.56 billion.
About Vitasoy International Holdings Limited
Vitasoy International Holdings Limited is engaged in the manufacture and sale of food and beverages. The Company manages its businesses by companies, which are organized by geography.
The Hong Kong and Macau business mainly represents the manufacture and sale of soymilk, tea, water, juice and tofu in Hong Kong, Macau and overseas and the operation of tuck shops and catering businesses.
The Mainland China business mainly represents the manufacture and sale of soymilk, tea and juice in Mainland China.
The Australia and New Zealand business mainly represents the manufacture and sale of soymilk and rice milk in Australia and New Zealand.
The North America business mainly represents the manufacture and sale of tofu, pasta, imported soymilk, imported juice and imported tea in North America.
The Singapore business mainly represents the manufacture and sale of soy related products in Singapore and overseas. Source
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