China Gaoxian Fibre Fabric Holdings Ltd said its subsidiary, subsidiary, Fujian New Huawei Fibre Dyeing Co., Ltd, has used RMB87.2 million (S$ 17.9 million) of its Initial Public Offering (IPO) net proceeds to buy 50 knitting machines for the production of Warp Knit Fabric.

The new machines are expected to be fully installed by the end of second quarter of FY2010 and will boost the group's production capacity for WKF by 88 per cent to 32,000 metric tonnes from 17,000 metric tonnes as at end 2009.

The capacity expansion is expected to contribute positively to the group's top-line growth starting from 3Q10.