(Yicai) July 16 -- Shares in GreatStar Industrial soared to their highest level in the last six months today after the Chinese manufacturer of hand and power tools said that it has secured a long-term supply deal with a leading European retailer.

GreatStar’s share price [SHE:002444] closed up 0.7 percent at CNY31.81 (USD4.40). Earlier in the day it climbed 2.8 percent to hit CNY32.48, the highest level since late January. The stock has gained almost 40 percent in value in the past month.

GreatStar has won a tender from a European retailer, which ranks high among Fortune Global 500 companies and which is already one of GreatStar’s top 10 customers, the Hangzhou-based company said yesterday. The client was not named due to confidentiality reasons.

GreatStar will supply consumer-grade cordless lithium battery-powered tools and related accessories to nearly 1,000 of the retailer’s outlets across Europe over the next three years, starting in the second half. The annual procurement value is expected to be at least USD15 million. The exact value of the deal was not given.

This is the firm’s first major European order for its power tools since GreatStar launched this product line in 2021, it said, adding that this is a clear sign that the company’s power tools are gaining recognition among top-tier global clients.

This is also GreatStar’s second big cordless lithium battery power tool order in less than a week. On July 11, the firm said it will supply similar products to thousands of outlets under another global retail giant over the next three years, with expected annual sales of at least USD30 million. That deal will see products destined for the US market manufactured at GreatStar’s factory in Vietnam.

GreatStar mainly makes hand tools, power tools and industrial tools. It is the largest supplier of tools and storage to US home improvement stores such as Home Depot and Lowes, as well as large retail chains such as the US’ Walmart, the UK’s Kingfisher and Canada’s Canadian Tire Corporation.

Power tools are a new business segment that GreatStar has been focusing on in recent years. Last year, this segment generated CNY1.4 billion (USD200.3 million) in revenue, accounting for 9.7 percent of the company’s total. The Americas and Europe remain the firm’s biggest markets, accounting for 63.4 percent and 24.6 percent of annual revenue, respectively, according to its 2024 annual report.

Editor: Kim Taylor