Orion Corp, South Korea’s major confectionery and snack manufacturer, has disclosed plan to invest Won 830 billion (US$585 million) over 3 years to expand snack manufacturing facilities at home and abroad to meet growing demand for its snacks overseas.
The company announced in a regulatory filing recently that its board of directors approved a plan to spend Won 460 billion (US$325 million) on building an integrated snack manufacturing-to-logistics center at the Technopolis Industrial Complex in Jincheon, Korea. This will also be the largest investment by a Korean food company at home in 5 years. Orion currently has 6 factories in the home country.
Orion will also invest Won 240 billion (US$169 million) and Won 130 billion (US$91.7 million) into its manufacturing operations in Russia and Vietnam respectively.
The large investments aim to meet growing appetite for its snacks overseas, particularly for its Choco Pie, which has become an international sensation.
Orion Corp expects its latest investments to push its annual sales to Won 5 trillion (US$3.53 billion) and Won 1 trillion (US$705.5 million) in operating profit. Orion posted Won 3.1 trillion (US$2.19 billion) in sales in 2024.
Its new mega 188,000 sq.metres integrated production center in Jincheon will house its production, packaging and logistics bases under one roof to increase efficiency. It was reported that Orion will use accumulated dividends derived from its highly lucrative overseas affiliates in China and Vietnam to build the new plant in Korea. To meet strong demand for its products overseas, some of those snacks produced from the new Korean plant will be exported to other countries.
Meanwhile, its existing plants in Russia and Vietnam are now running at or above capacity, leading to shortage in its products in these countries. Orion’s decision to build a new facility at its Tver plant in Russia will double its capacity and meet local demand. According to a spokesperson, 16 new production lines for pies, biscuits, snacks and jelly products will be added.
In Vietnam, Orion operates a wholly owned subsidiary, Orion Food Vina Co which currently owns 2 factories in Hanoi and HCMC. The new plant investment in Vietnam will help to bolster its position in Vietnam’s snack market. In 2024, Orion generated sales of Won 500 billion (US$352.8 million) from Vietnam market alone.
Next year, Orion plans to build an additional logistics center and packaging facility at its 3rd Hanoi plant to secure an annual production capacity of Won 900 billion (US$635 million). In Vietnam, both its Choco Pie as well as rice snacks are growing in popularity, with the latter possibly becoming the country’s No.1 snack in the near future.
