Foxconn to raise capital to expand overseas markets and develop new technology

February 18, according to the Wall Street Journal, Foxconn plans to split its fit (Foxconn interconnect marvell) Hon Hai Connector, which is to be listed in Taiwan next year, to expand its overseas markets and raise funds for new technology research and development.

It is understood that cable and connectors as the main business group of Hon Hai Connector, is an important component of electronic products, is currently widely used in computers, smartphones, tablet computers and other electronic products production and manufacturing. Foxconn has been manufacturing since its first foray into computer manufacturing in early 1980.

It is reported that fit is currently planned in Khalida, Pennsylvania, the United States to build a plant in Harrisburg, hoping to further open the door of the U.S. auto manufacturing market, but the IPO funding estimates, the relevant people did not disclose. In addition, it has been reported that fit has set up a research and development team in Pennsylvania State. Its manufacturing base is now spread throughout mainland China, the United States Texas and California State.

"Some American carmakers are looking for domestic suppliers, which is a good opportunity for us," he said. ”

Lu Songzing, head of the 55-Year-old fit department at Foxconn, said the plant was being built in Pennsylvania State to lock in the North American market. The new plant plans to employ hundreds of employees and will adopt a fully automated production line. In addition, he also said that the early years because of consumer demand for smartphones and computers increasingly strong, fit has developed rapidly in the recent past, but the recent price of products due to the market is becoming more saturated with the decline of the year. Therefore, the development of new markets has become fit to develop the urgent task. In his view, for example, fit has the ability to produce an iphone, ipad-equipped wireless charger for Apple.

The profitability of the cable and connector manufacturing sector, which currently accounts for only 2% of Foxconn's total profits, may still account for 15% to 20% of the group's total revenue in the future, given the high profit margins in the area, according to Jenny Lai, an analyst at HSBC. She also predicts that the expansion of new markets, such as cars, cloud services and the Internet, will make Foxconn's total revenue this year a double-digit growth.

It is understood that fit as the world's fourth largest cable and connector manufacturer, in 2013 its total revenue was only in the Connectivity Electronics (TE), Amphenol Corp. and Molex Inc manufacturing company. Mr Gou has said he hopes to make fit a number-one enterprise with a yearly income of nearly 3 billion dollars in the coming years.

Foxconn, in the past, has been known to the world by Hon Hai Precision Group (Hon Hai Precision Industry Co. Ltd). However, in recent years, the PC and traditional machine market has become increasingly depressed, Foxconn has begun to expand the market, through diversification of production to adapt to the new market demand. It is reported that Mr Gou has said Foxconn is planning to work with companies such as BMW and Tesla to further expand the auto parts industry.