TYC Brother Industrial Aims to Grab Larger Shares in ASEAN Automotive Market

News Source: 
Money DJ

Aftermarket (AM) automotive lighting manufacturer TYC Brother recently held a shareholder meeting announcing its financial performance for fiscal year 2015, where the company revenue reached NT $15.05 billion (US $467.38 million), and net profit of NT $670 million setting a new record high over the last 12 years, reported Money DJ.

The company’s revenue in May 2016 climbed up 6% MoM, and the company’s annual goal is to maintain growth rates, said the company Chairman Chun-chi Wu. Additionally, it is eyeing the Southeast Asian market and planning to deploying market strategies in Thailand’s automotive lighting aftermarket sector and Indonesia’s Original Equipment market, the company aims to maintain a healthy growth momentum in the next five years.

TYC Industrial’s revenue climbed up 7.78% YoY to NT $15.05 billion, setting a new historical record (excluding its Chinese subsidiary Varroc Lighting), the net profit soared 138.6% to NT $830 million, reporting profit before tax increased 36.98% to NT $1.12 billion.

TYC Lighting’s revenue in May 2016 climbed up 6.24% YoY to NT $7.95 billion. Wu analyzed the growth momentum mainly came from domestic and oversea new automotive market activities, which drove AM automotive lighting sales. The company will also accelerate the development of new products in the future to shorten the time it takes for new products to reach the market to ensure its leadership position. The company’s revenue growth target is still 5% this year.

Wu upheld a positive outlook on its oversea automotive industry developments, especially in China and ASEAN member states in Southeast Asia. The company will be actively deploying its market strategy in these two regions in 2016.

The Taiwanese automotive lighting maker will invest US $ 5 million in China, and will be expanding its Kunshan factory’s shipping warehouse. The factory spans 2,600 square meters and is to be completed by first half of 2017. The company will be able to construct 8 to 10 shipping warehouses by 2017, bringing the total warehouse capacity to 20. TYC Lighting will be capable of effectively providing in the Chinese region, and it has developed 25 new car light modules to meet new automotive lighting market demands.

Worth noting, the company’s OEM factory in Changzhou annual revenue reached RMB 1.1 billion (US $166.94 million) in 2015, and a net profit of RMB 100 million. Based on TYC Lighting’s 50% stake, the net profit was about RMB 50 million, and the company started to issue cash dividends. This is the first time the group in China profited and paid back to Taiwan’s parent company. The group estimates its revenues in 2016 will reach above 10% this year.

TYC Lighting has an optimistic outlook for the Southeast Asian market, where ASEAN will have great market potential in the next decade. TYC is positioned in the ASEAN AM, and deploying its market strategy from its Thailand factory and regional distribution channels. The company is deploying its market strategy in Southeast Asia through its regional distribution channels, while deploying its market strategy in automotive lighting repair markets to enter Nepal, Cambodia and other emerging markets in the Indochina region.

The company’s revenue in Thailand reached about 500 million Thai Baht (US $14.18 million), but the company did not profit. As ASEAN maintains positive growth momentum, TYC’s revenue in is likely to double in 2020.

As for the Southeast Asia original equipment market, Jouku Group which holds a 70% stake in TYC Lighting will be responsible for acquiring market shares in Indonesia and Malaysia’s automotive lighting market. The group’s revenue reached NT $1.7 billion to NT $1.8 billion in 2015, where Taiwan consisted its main revenue source, while Indonesia still comprises a relatively small market share. It is estimated the Indonesian factory established for three years, will be able to balance its income statement in 2016.

Optimistic about the Indonesian automotive market sales, which reached nearly 1 million cars in 2015, the company’s factory revenue is will exceed Taiwan’s in the next five years. The Jouku Group has acquired Malaysian automotive makers Proton and Perodua’s new automotive lighting R&D, and responded to car maker demands by setting up automotive lighting accessory factories there.

TYC Lighting’s delivered better than expected performance in second quarter, and the company aims to maintain annual revenue of 5%-10% during third quarter of the year to reach the historical high of NT $16 billion revenue mark. 

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