The nation’s two largest bicycle makers have seen a marked increase in their share prices since hitting lows in October last year, due to positive market sentiment aided by higher shipments of electric bikes and signs of stabilization in the Chinese market.
Giant Manufacturing Co (巨大) shipped 385,000 electric bicycles last year, almost double the number recorded a year earlier, the Chinese-language Liberty Times (the Taipei Times’ sister newspaper) reported last week.
High sales volume of electric bicycles, which had an average selling prices of about US$1,300 compared with US$350 to US$400 for traditional bikes, saw Giant’s revenue increase 9.44 percent annually to NT$60 billion (US$1.95 billion), company data showed.
The sales momentum of electric bicycles, coupled with rising US sales and recovering Chinese demand, saw Giant’s January revenue increase 8.53 percent annually to NT$4.82 billion.
The company told investors in December last year that its shipments of electric bicycles would reach 450,000 units this year, up 20 percent year-on-year, compared with single-digit percentage growth for its overall bicycle sales.
Smaller rival Merida Industry Co (美利達) also saw its shipments of electric bicycles increase.
It shipped 143,000 units last year, an increase of more than 50 percent from 2017, while its annual revenue grew 15.47 percent to NT$25.81 billion, company data showed.
Revenue for January grew 7.06 percent annually to NT$2.02 billion on shipments of 81,100 units, including 12,000 electric bicycles.
Merida’s capacity for electric bicycles is expected to increase from 15,000 units to 20,000 units per month, raising its annual e-bike shipments to between 220,000 and 240,000 units this year and further boosting its revenue and profit, the Liberty Times reported, citing forecasts by institutional investors.
“Merida’s earnings growth will come from expanding e-bike sales, as low e-bike penetration in the US and European markets implies a huge upside,” SinoPac Securities Investment Service Corp (永豐投顧) said in a note on Wednesday.
“In addition, the Chinese market has been recovering and the company’s investment in Specialized Bicycles Components Inc is also a positive factor,” it said.
In 2001, Merida bought a minority stake in Specialized Bicycles Components — the fourth-largest bicycle maker in the US.
Shares of Giant closed at NT$169.5 on Wednesday, the last trading day before the long 228 Peace Memorial Day weekend, up 47.39 percent from a low of NT$115 on Oct. 11 last year, Taiwan Stock Exchange data showed.
Merida ended at NT$161, a 53.33 percent increase from NT$105 on Oct. 30 last year.
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