Friday, March 29, 2024
 
Columnist
Martin Hennecke
 
CHINA ALUMCAN
HKEx Stock Code : 06898 
 
Corporate Profile
The Group is a manufacturer of monobloc aluminum aerosol cans. The Group's aluminum aerosol cans have been used by a number of well known consumer brands to package fast-moving personal care products such as body deodorant, hair spray and shaving cream as well as pharmaceutical products such as pain relieving spray, spray dressing and antiseptic spray. The Group can offer over 50 different models, in terms of dimensions, body contours and shoulder shapes for customers' selection. According to the CRI Report, The Group was the largest manufacturer of aluminum aerosol cans, in terms of production volume, for three continuous years from 2010 to 2012, with the market share above 30% in the PRC.

The Group's product

Aerosol packaging is widely used for liquid content. It has the advantages like easiness to dispense with precise application, air tightness for long term storage as well as convenience to carry around. Aerosol cans are usually made of aluminum or tinplate. However, aluminum aerosol cans possess features such as light weight, high recyclability and corrosion resistance as well as relatively high flexibility which allow them to be manufactured in easy-to-grip shapes for convenient content dispensing. Besides, they are perceived to be more pleasing by consumers as compared to containers made of tinplate. Therefore, for these reasons, aluminum aerosol cans are commonly used in the packaging of higher value consumer products, although their costs are usually higher than tinplate aerosol cans.

The Group estimates that the aggregate net proceeds (assuming the Over-allotment Option is not exercised) available to the Group from the Share Offer (after deducting underwriting commissions and estimated expenses payable by the Group in connection with the Share Offer) will be approximately HK$90 million (assuming the Offer Price of HK$1.1 per Offer Share, being the mid-point of the indicative Offer Price range). The Group intends to apply these net proceeds to partially fund the expansion of its production capacity, including the upgrading of its existing production lines and the acquisition of a brand new production line for aluminum aerosol cans; to establish a new research and development laboratory; to partially repay its US$- denominated bank loan; and for general working capital purposes.
Chairman Lin Wan Tsang Issued Capital (shares) 400M
Par Value HKD 0.01 Market Capitalisation (HKD) 496M
 
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