China Starch: Old Plant Relocation Of New Plant Lysine Production Capacity Maintenance

July 15, 2014, China Starch (03838.HK) officially announced the relocation of the old plant, one of the main products of lysine will actually maintain production capacityAccording to boyar, China's starch lysine production line began to relocate as early as last year, the current production capacity of about 105,000 tons, 98% content and low content (70%) each halfIt was also learned from the market that manufacturers may have plans to expand production in the future, with an expected capacity of 200,000 tons (98 and 70% of products each half), is still a cause for concernThe specific relocation announcement is as follows:aF2to implement the Group's expansion plan, its existing production plant and facilities in Shouguang City, Shandong Province, will be relocated to a new production site that may be approved by the Shouguang Municipal Government, and the relocation is expected to be completed by the end of 2014It is estimated that the relocation will enable the Group to divest in non-current assets of about RMB 187 million on existing production facilities and buildings located at the existing plantThe new plant is located in Shouguang and is located on a number of plots acquired by the Group in October 2012, November 2013 and May 2014 respectively, with a total site area of approximately 299,873 square metresaF2
1, the new plant corn starch, lysine and denatured starch production capacity is the same as the existing plant, of which the denatured starch production facilities are under construction, is expected to be completed in the fourth quarter of this year, the existing plant denatured starch production line from mid-July temporarily discontinued, is expected to last about 3 months;aF2
2The existing plant of the Group will also cease production of electricity and steam at or before the completion of the relocationThe new plant will not be built to produce electricity and steamThe Company said that the Power and Steam Division contributed only a small amount to the Group's total turnover and gross profit (approximately 1.7% and 3.7% for the year ended 2013), and the Directors believed that the relocation and the suspension of power and steam of the Group would not have any material adverse effect on the Company's business operations and financial position aF2
　　3, the existing plant is located in the land will be completed after the relocation of the Shouguang Municipal Government to recover It is expected that the Shouguang Municipal Government will provide subsidies to the Group for relocation or in this regard, the amount determined by the Shouguang Municipal Government The subsidy provided by the Shouguang Municipal Government (if granted) will have a positive impact on the group's long-term financial position, and aF2 believes that neither the relocation nor the group's power and steam production will adversely affect the operation sorority of the Business or the financial position aF2 July 15, 2014, China Starch (03838.HK) officially announced the relocation of the old plant, one of the main products of lysine will actually maintain production capacity According to boyar, China's starch lysine production line began to relocate as early as last year, the current production capacity of about 105,000 tons, 98% content and low content (70%) each half It was also learned from the market that manufacturers may have plans to expand production in the future, with an expected capacity of 200,000 tons (98 and 70% of products each half), is still a cause for concern The specific relocation announcement is as follows: aF2 to implement the Group's expansion plan, its existing production plant and facilities in Shouguang City, Shandong Province, will be relocated to a new production site that may be approved by the Shouguang Municipal Government, and the relocation is expected to be completed by the end of 2014 It is estimated that the relocation will enable the Group to divest in non-current assets of about RMB 187 million on existing production facilities and buildings located at the existing plant The new plant is located in Shouguang and is located on a number of plots acquired by the Group in October 2012, November 2013 and May 2014 respectively, with a total site area of approximately 299,873 square metres aF2
　　1, the new plant corn starch, lysine and denatured starch production capacity is the same as the existing plant, of which the denatured starch production facilities are under construction, is expected to be completed in the fourth quarter of this year, the existing plant denatured starch production line from mid-July temporarily discontinued, is expected to last about 3 months; aF2
　　2 The existing plant of the Group will also cease production of electricity and steam at or before the completion of the relocation The new plant will not be built to produce electricity and steam The Company said that the Power and Steam Division contributed only a small amount to the Group's total turnover and gross profit (approximately 1.7% and 3.7% for the year ended 2013), and the Directors believed that the relocation and the suspension of power and steam of the Group would not have any material adverse effect on the Company's business operations and financial position aF2
　　3, the existing plant is located in the land will be completed after the relocation of the Shouguang Municipal Government to recover It is expected that the Shouguang Municipal Government will provide subsidies to the Group for relocation or in this regard, the amount determined by the Shouguang Municipal Government The subsidy provided by the Shouguang Municipal Government (if granted) will have a positive impact on the group's long-term financial position, and aF2 believes that neither the relocation nor the group's power and steam production will adversely affect the operation sorority of the Business or the financial position aF2
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