Billionaires at Midea, Haitian Turn Foshan into Manufacturing Powerhouse in Greater Bay Area’s Fourth-Largest Economy

Behind the city’s 1.08 trillion yuan (US$164.7 billion) economy is an assembly of manufacturing giants, the most famous of them being home appliances maker Midea Group and Foshan Haitian Flavouring & Food.

Some 41 Foshan-based companies are traded on the Shanghai and Shenzhen stock exchanges, according to data compiled by the China Business Industry Research Institute. They commanded a combined market value of 1.61 trillion yuan at the end of 2020.

Midea Group, Haitian Flavouring, Country Garden, Guangdong Xinbao Electric, Hisense Home Appliances Group, Grandblue Environment, Guosheng Financial Holdings, Keda Industrial, Keshun Waterproof Technologies, and Monalisa Group make up the top 10 list.

Here are the five largest firms in Foshan, based on their market capitalisation at the close of trading on April 2.

1. Midea Group

The world’s largest home appliances maker tops the list with a market cap of 613.4 billion yuan (US$93.4 billion). The Shenzhen-listed firm is ranked 307th in the Fortune Global 500 List in 2020.

Based in Shunde, one of the five districts in Foshan, the firm recorded a 32 per cent jump in earnings to 8.09 billion in the third quarter to September 2020. It grew sales by 16 per cent to 78 billion yuan. For the January-to-September period, revenue fell 1.8 per cent to 217.8 billion yuan while earnings rose 3.3 per cent to 22 billion yuan.

2. Foshan Haitian Flavouring & Food

Foshan Haitian was listed in Shanghai in 2014, whose brand dates back to the Qing dynasty during the reign of Emperor Qianlong (1711-1799) when it was the biggest soy sauce manufacturer in the city. It was born out of a merger of 25 local companies in the industry.

It had a market value of 552.2 billion yuan. While its success lies in its soy sauce, it also sells other condiments such as vinegar, sesame oil, oyster sauce and chicken extract.

Today, the group operates the world’s biggest condiment production base of around 0.8 square miles in the Gaoming district. It invested more than 1 billion yuan in the factory, which can produce more than 1 million tonnes of condiments annually.

The group generated 15 per cent more sales in 2020 to 22.8 billion yuan, or the equivalent of 11 per cent of what Tesla got from selling electric cars last year. Earnings rose 20 per cent to 6.4 billion yuan.

3. Country Garden

Yang, who co-chairs the developer with her father, is credited with US$34.6 billion in net worth. Her spouse Chen Chong is a non-executive director.

4. Guangdong Xinbao Electrical Appliances

Like Midea, Xinbao is located in the same district of Shunde with a focus on kitchen appliances such as kettles, coffee machines and toasters. It produces the Donlim brand and holds rights to produce the Morphy Richards brand in China from the namesake UK group based in South Yorkshire.

Its net profit surged by 75 per cent to 1.4 billion yuan in 2020, while revenue jumped 44 per cent to 13.3 billion yuan. Domestic sales improved 65 per cent while gains outside mainland China increased by 40 per cent from a year earlier, it said.

Guo Jiangang, 55, founded the company in 1995 and is worth about US$1.9 billion, according to Forbes.

5. Hisense Home Appliances Group

The home appliances producer was founded in 1969, beginning its corporate life by producing small radios in Foshan.

The firm had a market value of 22.1 billion yuan on April 2. Its shares were first listed in Hong Kong in July 1996 and a flotation of A shares in Shenzhen followed three years later.

Its biggest shareholder is state-owned Qingdao Hisense Air-conditioning Co with a 57.2 per cent stake, according to its interim report published in September last year.