August 10, 2011

Shanghai-listed Inner Mongolia Yili Industrial Group Co Ltd expects to spend RMB453 million (US$70.6 million) in constructing a UHT milk production facility in Jiyuan city, Henan province.

The construction will take 17 months and the pay-back period is 4.67 year. The return on investment is expected to be 13.54%. The first-phase production capacity is 700 tonnes per day and the capacity will be subsequently expanded to 1,300 tonnes.

This is Yili Industrial Group's third investment in 2011. It said on January 20 that it would build a 780-tonne/day UHT milk production facility in Wuzhong city, Ningxia with an investment of RMB359 million (US$56 million). An 800-tonne/day UHT milk production facility was built in Huizhou city, Guangdong province with a cost of RMB457 million (US$71 million).

Yili Industrial Group obtained RMB18.869-billion (US$2.94-billion) operating revenue from main business in the first six months of 2011, up 28.42% on-year. Of the total, RMB12.894 billion (US$2 billion) or 68%, was derived from milk.