Event: Yangzi Xincai announced on the evening of November 17th that the company plans to acquire a 60% stake in Suzhou Lide pump Technology Research Institute Co., Ltd. (hereinafter referred to as "Suzhou Lide") with its own capital of 1.8 million yuan. In addition, the company and Suzhou Lide also signed a "framework agreement on equity restructuring and development strategy". According to the agreement, after all the changes in the equity transfer are completed, the transferor and the transferee will increase the capital of the target company, and the registered capital of Suzhou Lide will be increased from 3 million yuan to 10 million yuan. the company will continue to contribute 4.2 million yuan to Suzhou Lide according to its shareholding ratio.
Comments:
Enter the research field of pump technology and expand new profit points. After the completion of this transaction, Yangzi Xincai will directly become the controlling shareholder of Suzhou Lide, and the company will also enter a new field of pump technology research. As a controlling shareholder, the company can make decisions to develop and utilize the technology, market, capital and other resources owned by Suzhou Lide, so as to realize the integration and sharing between Suzhou Lide and the company's resources, so as to further enhance the profitability of the company.
Suzhou Lide has many patents in the field of pump technology. Suzhou Lide, founded by Dr. Wang Dejun of Tsinghua University, was formally established in Suzhou Industrial Park in early August 2011, specializing in high-end pump technology research, pump product industrialization and pump enterprise digitization projects. it involves pump performance, structure, sealing, material, strength, internal flow characteristics, vibration, noise, transmission, control, support, appearance and many other aspects as well as the world's cutting-edge new fluid machinery. At present, Suzhou Lide has 5 authorized utility model patents, 5 invention patents and a number of independent research and development achievements in the pump field.
The company's fund-raising projects are progressing smoothly, seizing the high-end market. The company now has an annual production capacity of 80, 000 tons of organic coated plates and a substrate capacity of 200000 tons. After the completion of the fund-raising project (we expect to reach production in February 2014), the production capacity of functional organic coated boards will be increased by 220000 tons per year. The company's "substrate-organic coating plate" production chain will be further improved, and the existing product structure will also be optimized and upgraded. In addition, due to the high gross profit margin of the function board, with the increase of its proportion of income, the company's performance is expected to improve gradually.
Profit forecast and rating: as there is little impact on the company's performance in the short term of this acquisition, we temporarily maintain the company's diluted profit forecasts of EPS0.26 yuan, 0.35 yuan and 0.48 yuan from 2013 to 2015. Taking into account the leading position of Yangzi New Materials in functional organic coated boards and the high probability of performance improvement in the next few years, we maintain the company's "overweight" rating.
Risk factors: economic operation is declining, downstream demand is slowing down; production line construction process is lower than expected; accounts receivable has increased significantly.