CHINARES PHARMA has announced that its non-wholly owned subsidiary, Dong-E-E-Jiao Co.,Ltd., has resolved to invest in and construct a health consumer goods industrial park. The park is expected to include manufacturing facilities for health consumer goods, such as medicines, homologous foods, health products, and functional foods, along with supporting storage and logistics facilities, a quality inspection center, a new product incubation center, and an e-commerce sorting and finished medicine warehouse.
The total land area for the health consumer goods industrial park is projected to be approximately 406,800 square meters, with a proposed construction area of about 151,100 square meters. This will encompass production facilities for items like ejiao glue, ejiao date, and ejiao powder, supported by a comprehensive warehouse, an e-commerce center, other storage facilities, and quality inspection and incubation centers to meet testing and new product development needs. Public utilities, including sewage treatment and power supply systems, will also be provided.
The total estimated investment amounts to approximately RMB 1.485 billion, of which fixed asset investment is about RMB 1.421 billion, and basic working capital is around RMB 64 million. The investment and construction of the industrial park are considered essential for Dong-E-E-Jiao Co.,Ltd. to implement its "1238" strategy. This involves creating a model for high-quality development in traditional Chinese medicine and establishing a dual-drive business growth model that integrates pharmaceuticals with health consumer goods. By expanding into the health consumer goods sector alongside its pharmaceutical base, the company aims to cultivate a second growth curve, with the two business segments mutually reinforcing and empowering each other.
The proposed project also addresses the urgent needs of Dong-E-E-Jiao Co.,Ltd.'s health consumer goods business development. The company's existing industrial park faces limitations in expansion area and capacity bottlenecks in key production lines, which are inadequate for meeting the rapid upgrade and iteration demands of the health consumer goods market. Furthermore, constructing its own production facilities will help build a core competitive advantage in the health consumer goods field. Dong-E-E-Jiao Co.,Ltd.'s health consumer goods primarily consist of ejiao series products. Manufacturing these products in their place of origin, Dong'e County, can strengthen the brand's geographical identity, further enhance core competitiveness, systematically build brand leverage, and control long-term scale costs.
The investment and construction of the health consumer goods industrial park are conditional upon the acquisition of the proposed project land and the execution of construction agreements, and will be subject to the terms and conditions outlined in those agreements.