(Yicai) Aug. 28 -- Shares in Haier Smart Home advanced as much as 2.6 percent today after the Chinese household appliance maker, which is one of the country’s top three air conditioner sellers, said that it will invest CNY2.5 billion (USD350 million) to build a smart manufacturing base for air conditioners.

Haier Smart Home’s share price [SHA:600690] closed down 0.9 percent at CNY23.86 (USD3.35). Earlier in the day it hit CNY24.72.

The new factory will produce seven different types of air conditioners, including wall mounted ones, and will be located in the China-SCO Local Economic and Trade Cooperation Demonstration Zone in Qingdao, eastern Shandong province near the company headquarters, Haier Smart Home, said yesterday. There will also be a R&D and experiment center as well as a logistics hub.

The facility is expected to boost output by five million air conditioners a year, the company said. The air con units will mainly be sold to China’s northern and northeastern regions as well as overseas markets. The first phase should be ready in September 2026 and the second phase in December 2027.

The project will also enhance Haier Smart Home’s research and development strengths, optimize its positioning in global supply chains, increase market share and enlarge brand awareness. The project’s static investment payback period is estimated to be around five years.

Haier Smart Home’s net profit soared 16.3 percent in the first half year on year to CNY10.4 billion (USD1.4 billion), according to its latest semi-annual report released yesterday. And its gross profit margin expanded 0.2 percentage point to 30.6 percent.

Revenue climbed 3 percent to CNY135.6 billion (USD19 billion), the report said. And revenue from its air and energy solutions segment, which includes air conditioners, advanced 3.8 percent to CNY29.2 billion (USD4.1 billion), accounting for 21 percent of total revenue.

Haier Smart Home holds a 17.9 percent share of China’s floor-standing and wall-mounted air conditioner brick-and-mortar retail market and 10.4 percent of the online market, the report said, citing German market research firm Gfk.

Editor: Kim Taylor