Leading bio-ingredient solutions provider Bon Natural Life Limited (NASDAQ:BON) has announced receiving certificate of land use right for future site of the company’s third production facility in Yumen. The new plant will allow it to augment overall production capacity by more than 200%.
Yumen city in China, is reputed for the fine chemical industry and BON’s plant will be advantageous to the firm being near to raw materials for the bioactive food ingredient products as well as fragrance compounds. Also, the city is a gateway for exports to EU markets, being vital for the company’s expansion plans.
Furthermore, the city’s business-friendly local government has been supportive to the company providing potential tax breaks and other incentives, being currently under negotiation. Constructed on 8.2 acres of industrial-use land, BON will be permitted to use the space for next 50 years.
Richard (Yongwei) Hu, the Chairman and CEO of Bon Natural Life Limited said that the land-use right permission is a significant step for expansion of both capacity as well as meeting demand of domestic and international customers. Expected to commence in July 2021 and complete by June 2022, the company will boost manufacturing by September 2022 after an initial trial of two months. He added that the production will jump by 200%, from 170 tons to 520 tons.
Market Reaction:
On Tuesday, BON stock went up 26.46% at $10.18 with more than 1.20 million shares, compared to its average volume of 1.33 million shares. The stock had moved within a range of $8.51 – 12.00 after opening the trade at $8.66. Over the past 52-week, the stock has been trading within a range of $6.29 – 12.00.
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