XiDeLang shares flat despite news of deal

PETALING JAYA: -based XiDeLang Holdings Ltd’s closed unchanged at 25 sen yesterday, despite announcing a memorandum of collaboration (MoC) with another company, Yeli International Ltd, which will see it secure original design manufacturing (ODM) production orders of no less than 210 million renminbi (RM133.8 million) over two years through subsidiary HongPeng Fujian Shoes & Garments Co Ltd.

Year-to-date the company’s stock has increased 150%, compared with the FBM KLCI which has gained 8.3%.

XiDeLang is a rare performer among the group of China-based companies which have been underperforming in the local market. The company’s net profit for the first quarter ended March 31, 2017, more than doubled to RM3.755 million, on a 20% jump in revenue for the first three months, compared with the same quarter in the preceding year. This came on higher sales of its own branding sports shoes and increased orders for ODM production.

For the ended Dec 31, 2016, XiDeLang reported a net profit of RM6.93 million and revenue of RM503.8 million.

The company on Tuesday announced that HongPeng Fujian has signed an MoC with Yeli International, which specialises in high-end footwear products, and possesses better brand resources and a longer collaboration relationship with renowned international footwear and sporting goods companies such as Tempe SA (a subsidiary of Inditex Group) and Intersport (world’s largest sporting goods retailer).

HongPeng Fujian is a footwear and apparel manufacturing company with extensive internal capabilities and expertise on footwear product development and production management. Its existing overseas clientele consist of multiple renowned international brands, which include Zara, Pull & Bear and Diadora. It operates in a modernised eco-industrial park with a built-up area of 82,000 sq m with an annual output value of exceeding 600 million renminbi.

Source: The Sun Daily

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