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Jiaxin Silk: a complete industrial chain of silk leading enterprises
Zhejiang Jiaxin Silk Co., Ltd. (stock code: 002404), soon to be listed on the Shenzhen Stock Exchange, is set to strengthen its position in the global silk industry. According to insiders, the successful implementation of its fundraising projects post-IPO will enable the company to leverage its scale advantage, bridge production gaps, accelerate technological innovation, and further enhance its international presence.
Founded in 1999, Jiaxin Silk has evolved into a leading integrated enterprise specializing in the research, development, production, and sales of silk products, including garments, fabrics, and related accessories. With a diversified product structure and strong R&D capabilities, the company ranks third in main business revenue and fifth in competitiveness within China’s domestic silk industry.
In 2009, clothing-related products accounted for 60.20% of the company’s revenue, followed by hardware at 17.92%, silk products at 2.96%, and other silk-related items at 8.11%. Approximately 75% of its products are exported, primarily to the U.S. and Europe, with major clients being well-known international brands.
The company follows a hybrid business model, with about 60% of production self-managed and 40% outsourced. High-end garments and knitted fabrics are mainly produced in-house. Over decades, Jiaxin Silk has built a complete industrial chain from cocoon processing to finished silk garments, supported by a strong technical foundation and management expertise.
To further integrate its operations and maximize synergies, the company established a 400-hectare Jiaxin Silk Industrial Park, housing all core businesses such as reeling, weaving, printing, dyeing, and garment manufacturing. The park includes essential infrastructure like water supply, power, and waste treatment systems, enhancing operational efficiency and reinforcing the company's competitive edge.
With the global economic environment becoming more volatile, market risks for Chinese silk companies have increased. Smaller, less competitive firms are likely to be phased out, while larger enterprises with comprehensive industrial chains can better withstand fluctuations. Jiaxin Silk’s diversified operations across multiple stages of the silk industry help mitigate these risks.
The company also benefits from a strategic outsourcing model, where high-value-added products are produced in-house using advanced technology, while simpler or lower-margin items are handled by trusted partners. This approach ensures quality control and maximizes overall efficiency.
To further strengthen its position, Jiaxin Silk plans to raise funds for several key projects, including the development of natural fiber knitted fabrics, seamless silk underwear, embroidered silk items, and high-end woven garments. These projects aim to expand the company’s production capacity and promote synergy between fabric and garment manufacturing.
The total investment for these projects is 341.22 million yuan, with expected annual revenue of 78.97 million yuan and net profit of 70.88 million yuan. This will offset the depreciation costs and significantly improve the company’s profitability and financial stability.
Once implemented, the projects will not only boost production capacity and profitability but also optimize the company’s capital structure and reduce financial risk. The expansion will enhance Jiaxin Silk’s ability to meet customer demands quickly, maintain high-quality standards, and further solidify its reputation in the international market.