Boston, MA 03/04/2014 (wallstreetpr) – Changshu Huaye Steel Strip Co a subsidiary of Sutor Technology Group Ltd (NASDAQ:SUTR) which manufactures fine finished steel products has entered into a contractual agreement with Samsung Group. Under the terms of the agreement, Changshu Huaye will be required to supply Samsung Group with a total of 6,500 metric tons of aluminum-Zinc Alloy coated steel also known as Galvalume.
Impact of the deal to Sutor Technology
The contract has been valued to be approximately $5.2 million with the goods expected to be shipped as of the beginning of April 2014, to Samsung’s operating base in Brazil. The announcement of the deal had a major impact on Sutor Technology as stocks which surged surgemid-morning trading session. The company stock surged by highs of 32.67% to trade at high levels of $2.38 a share.
Sutor Technology Group Ltd (NASDAQ:SUTR) expects the deal to positively impact its earnings for the current quarter and full year results. The deal canalso open other avenues for the company to sign similar contractual agreements with other companies in demand of pure Aluminum-Zinc Alloy. The demand from Samsung might go up in the coming years if the current deal works out as expected, considering Samsung is one of the key players in the production of Smartphones and tablets which are on the rise in the market.
Reaction from Sutor Technology
Sutor Technology Group Ltd (NASDAQ:SUTR)’s Chief Executive Officer could not hide his excitement after the agreement went through and clearly stated the lengths the company has come from, to provide high quality Galvalume products within the short period of commercial production. It is only in the fourth quarter that Sutor Technology started commercial production of Galvalume steel and in a few months they have already signed a mega deal with a key industry player.
Commercial production begun in the fourth quarter which only materialized with less than 200 tons in the initial stages a number that has surged to highs of 6,000 tones. This clearly states the company’s ability to meet Samsung demand at any given time. The agreement with Samsung clearly demonstrates Sutor Technology ability to guarantee quality products while also commercializing its new products. Sutor Technology Group Ltd (NASDAQ:SUTR) has a huge portfolio of products that can be used for consumer product markets such as its anti-finger prints, anti-bacteria lines of products.
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