Shanghai Prime Machinery Co., Ltd. (SPM) reported the profit gain of RMB 0.28 bn with a YoY ratio of 10.66% and the revenue of RMB 9.028 bn with a YoY ratio of 6.47%. Its main business – fastener, showed an increasing revenue, which was benefited by its acquisition of CP Tech in Aug. 2017. In particular, the automotive fasteners representing 83% of its total fastener sales showed the sales of RMB 5.597 bn last year, a growth of 9.7%.
The car sales and production in China appeared to be weak in 2018, which to some extent caused an impact on the demand for automotive components. According to SPM’s President Chou, not only in China, the demand growth in the world also shows a slowdown. It is expected that the increasing demand for related components in Q1 this year will continue to slow down. However, the tax reduction policies of the Chinese Government, the price reduction announced by certain car manufacturers and the incoming car sales boosting measures proposed by the Chinese Government will be definitely helpful to boost car sales and will be beneficial to the company indirectly.