Plant production is expected to commence in April 2021.
With a land area of 100,000 square metres, this will be Vitasoy’s largest production site in mainland China.
RMB$1bn (USD$143m) will be invested for land use right, construction purpose, and purchase of production equipment.
The ground breaking ceremony took place on Oct 30.
“Mainland China is now our biggest and fastest growing market. The new Dongguan production base will be Vitasoy’s biggest plant, but our commitment and determination goes beyond scale. The new plant will also provide us with adequate production capacity to support our future expansion,” said Winston Lo, the executive chairman of Vitasoy.
“We are determined to grow a healthy and sustainable business which can represent a model for the future and can contribute to the health of the communities we serve in Mainland China,” he added.
The new plant will be designed and built based on LEED (Leadership in Energy and Environmental Designed) Gold certification standards by the US Green Building Council to support Vitasoy’s commitment to sustainable development and efficient use of resources.
Vitasoy, a Hong Kong based firm, manufactures and distributes plant-based food and beverages. It currently has manufacturing operations in Hong Kong, China, Australia, and Singapore, which supply products for about 40 markets worldwide.
Strong growth in China
The Mainland China has delivered “particularly strong performance” in FY2017/2018, with revenue increased 39% to HK$3,700m (USD$472m), Vitasoy’s financial report has shown.
Given the speed of growth, it said it was expecting a more moderate growth in FY2018/2019.
Elsewhere in Australia, the firm claimed to have retained the market leadership position in plant milk, with revenue up 6%.
In the FY2017/2018, the company achieved a revenue of HK$6,465m (USD$824m), a 21% increase from the year before. Gross profit was HK$3,420m (USD$436m), which was 19% higher, with gross profit margin sustaining at 53%.
Drivers of growth
Favourable margins and expansion of sales volume, in addition to continuous improvement in efficiency were the main drivers of growth in China, Vitasoy said in its financial report.
“Our previous investments in enhancing brand equity on both brands VITASOY and VITA contributed to the overall result.”
Its e-commerce business in China has also provided additional growth and scale, it added.
