(Yicai Global) March 5 -- Sante Cableway Group plans to invest CNY353 million (USD54.5 million) to build an ecological theme park by Qiandao Lake, a famous tourist destination in China’s Zhejiang province. The firm hopes the project will help with diversification from its core business of operating cable cars.

The new park will be named Muxingu and will cover an area of about 3.28 million square meters, the Wuhan-based company said in a statement today. As well as sightseeing, the park will offer mountain sports, immersive experiences and accommodation.

The construction period is expected to last two years and the company anticipates average annual net profit over the next 20 years of CNY34.9 million (USD5.38 million), with revenue averaging CNY123.7 million a year.

Sante Cableway said it hopes to become an eco-theme park operator and to integrate sightseeing tours and leisure vacations. It operates two ropeways near Qiandao Lake, with over one million passengers using them every year, it added.

Qiandao Lake was created by the construction of a dam for a hydropower station in Hangzhou, Zhejiang province. Famous for its clear water and forest landscape, it had 18.8 million tourists in 2019. Most visitors come from the economically developed Yangtze River Delta region, where per capita spending power is high.

Founded in 1989, Sante Cableway operates more than 20 scenic spot projects in nine provinces. Affected by the Covid-19 pandemic, the company reported a CNY10.6 million net loss for the first three quarters of last year on a 52 percent drop in revenue to CNY253 million (USD39 million).

As of today's close, shares in Sante Cableway [SHE: 002159] were up 0.5 percent at CNY12.13 (USD1.87) each, bringing its total market value to about CNY2.2 billion (USD339 million). 

Editor: Tom Litting