One year on the marketFrand plans to cut into the new energy automobile industry chain.
The company’s main business is to provide complete steel logistics supply chain services for mid-to-high-end automotive, home appliance and other industries or their supporting manufacturers. The upstream of the company’s industry is mainly the steel industry, and the downstream is mainly the automobile industry. As of September 2021, more than 75% of the company’s sales revenue comes from end users.
In terms of shareholding structure, as of the announcement date of this plan, the company’s actual controllers, Cui Jianhua and Cui Jianbing, have controlled approximately 284 million shares of the company through direct and indirect means, accounting for 65.17% of the company’s total share capital before the issuance.
According to the calculation of the upper limit of the number of shares to be issued this time, after the completion of this time, the direct and indirect shareholding ratio of Cui Jianhua and Cui Jianbing will drop from 65.17% to 50.13%, and they will remain the controlling shareholder and actual controller of the company.
Sorting out this fixed-increasing project, the “New Energy Automobile Plate Production Base Project” has a total investment of 299 million yuan, and the project construction period is 18 months. It is expected to achieve an average annual sales income of 853 million yuan and an average annual net profit of 43,907,900 yuan after reaching production capacity. The after-tax internal rate of return is 11.30%, and the after-tax static payback period is 6.91 years (excluding the construction period).
The company plans to establish a steel and aluminum processing and distribution base in Shucheng County, Lu’an City, Anhui Province through this project. According to the current transportation distance, the order response speed of auto parts manufacturers will be effectively improved.
The fixed increase plan shows that the company will also set up a subsidiary “Anhui Unocal Automobile Technology Co., Ltd.” in Anhui to plan to build a new energy automobile aluminum die-casting construction project. The project has a total investment of 479 million yuan and a construction period of 24 months. After the project is put into production, it is expected to achieve an average annual sales income of 795 million yuan, an average annual net profit of 78.56 million yuan, an after-tax internal rate of return of 13.96%, and a static after-tax payback period of 5.44 Years (excluding construction period).
The company said that the new energy vehicle aluminum die-casting construction project is highly related to the company’s current upstream cooperation units and downstream customers. At present, the company has mastered the relatively advanced aluminum die-casting production process and plans to introduce advanced aluminum die-casting production equipment.
According to the announcement, the above-mentioned fundraising projects are highly related to the company’s main business. After implementation, they will expand the scale of production and operation and add aluminum die casting business, but they will not have a significant adverse impact on the company’s business structure, customer types, and other aspects. This fixed increase will expand the company’s product line based on improving the company’s processing and distribution center layout, thereby improving the company’s overall competitiveness and comprehensive service capabilities.
In addition, according to the pre-planned plan, if the above-mentioned projects successfully reach production and sales, the company’s performance will be greatly enhanced. The company’s financial report shows that in the first three quarters, the company achieved operating income of 7.06 billion yuan, a year-on-year increase of 64.95%; realized a net profit of 253 million yuan, a year-on-year increase of 28.18%, and an earnings per share of 0.58 yuan.