Caprolactam is a major raw material used in the production of polyamide chips that Li Heng needs for its nylon yarn products.

Importers of the product will be required to place anti-dumping deposits with the Chinese government at rates ranging from 4.3 percent to 25.5 percent with effect from Jan 25, Li Heng said in a disclosure to the Singapore Exchange.

"We therefore have to employ higher cash flows to sustain our operations if such anti-dumping deposits remain," it said. "We are also exposed to higher raw material costs if the (government's) final rulings on the pending investigation impose the levy of antidumping tariffs."