Chinese Fir Crossover: Garment Industry C No Longer, Investment Income Accounted For Half Of The Performance

In 2017, the investment income of the Bank of Ningbo accounted for half of the achievements of Shanshan Group. In 2018, Ningbo bank, Chou Chou bank and Luoyang molybdenum industry contributed a lot of return on investment. In the first half of last year, Shanshan stock investment income was 260 million, accounting for 55.79% of its net profit.

"Shan Shan suit, not too smart", how many people remember this slogan?

According to the 2017 report of Shanshan stock exchange, its apparel business revenue has dropped to about 8%, while its revenue accounted for about 61% in 2007 ten years ago.

According to reports, the market share of Shanshan brand in Western clothing market has dropped from 37.4% in 90s to 2.25% in 2015.

After 30 years of development, today, the industrial layout of the Chinese fir series is not limited to clothing. The Chinese fir is dominated by Shanshan holdings, including hundreds of subsidiaries. Its industrial layout is covered by new energy, technology, fashion, investment services, urban complex, trade logistics, tourism, medical care, financial leasing and other fields.

As the soul of the family of Shanshan, Zheng Yonggang's identity is no longer just the director of the clothing factory, but also the cross-border identity of the lithium bigwigs and the capital bigwigs.

"I hope I come in from clothing, from finance, and I want to be a financier."

In 2016, Zheng Yonggang once said.

According to the semi annual report of 2018, its financial equity investments are mainly Ningbo bank, Chou Chou bank and Luoyang molybdenum industry, which bring huge investment returns to Shanshan stock.

By the end of 11 2018, Shanshan stock held 4 billion 53 million yuan for the sale of financial assets.

In 2017, its investment income was 691 million 800 thousand yuan, and it was 59 million 780 thousand yuan in 2007 ten years ago.

According to media reports, Zheng Yonggang issued a vision in 2016, "the main source of new energy Shanshan shares, to 2018 must reach 50 billion of the market value."

However, as of the end of 2018, the total market value of Shanshan stock was only 14 billion 506 million yuan.

In the most difficult years of 2018, its clothing business was once again listed on Hong Kong stock market.

In June 27, 2018, Brand Company, a clothing company of Hongkong, was listed on the main board of the stock exchange of Hong Kong, and its stock was referred to as "Shanshan brand".

Meanwhile, in the first half of 2018, it acted in stripping off non core brand businesses.

The company said that the financial performance of MARCOAZZALI and LUBIAM brands is declining. In order to focus on the development of core private brands (FIRS and SHANSHAN brands), Shanshan Brand Company intends to sell non core brand businesses.

In the first half of 2018, Shanshan Brand Company and the independent third party completed the pfer of MARCOAZZALI brand equity.

Meanwhile, Shanshan Brand Company is also looking for suitable buyers to acquire LUBIAM business.

For the future development plan, in January 11, 2019, Shanshan shares told the Beijing News reporters that "the company's clothing business and financial leasing business have all achieved the first listing of H-shares, which is consistent with the overall strategy of the company focusing on the new energy industry and focusing on the development of new energy businesses. In the future, the company will focus its resources on strengthening and strengthening the lithium-ion battery material business, consolidate its leading position in the industry, and actively promote the introduction of the strategic investors of the new energy vehicle business sector, so as to realize the stable and healthy development of the core business of the company's main business."

As of 2017, clothing was no longer the lifeblood of "Shan Shan", its revenue accounted for more than 60% from ten years ago to 8%.

The Chinese fir originated in the clothing industry.

Dating back to 30 years ago, at the end of April 1989, Ningbo Yong Gang garment factory lost huge amounts of money, was insolvent and was on the verge of bankruptcy.

Under such circumstances, Zheng Yonggang, director of the Ningbo cotton textile mill in Yin County, became the director of the Ningbo Yong Gang garment factory in May 23, 1989 due to outstanding performance and danger.

According to Zheng Yonggang's account of Zhejiang businessmen magazine, the Ningbo Yong Gang garment factory was unable to get loans from banks even because of its insolvency, so he went to Shanghai to borrow money, and then went to CCTV to advertise. "In the past, because no clothing enterprises had advertised in CCTV, they were red handed."

Ningbo Yong Gang garment factory is the predecessor of Shan Shan, and "Shanshan" brand registered trademark is also belong to Ningbo Yong Gang garment factory.

In 1992, Ningbo Shanshan Limited by Share Ltd was established and its main body is Ningbo Yong Gang Garment General Factory.

Later, Zheng Yonggang concluded that he was doing something in the clothing industry -- pforming the original production factory into a business enterprise, and using a certain business philosophy to do business.

Nowadays, Ningbo Yong Gang garment factory has been cancelled, and Ningbo Shanshan Limited by Share Ltd has been listed for many years.

In January 3, 2019, the Beijing News reporter came to Ningbo Yong Gang garment factory and Ningbo Shanshan Limited by Share Ltd's first registered place, Ningbo, 139 Baichang East Road.

There is no trace of clothing factories here, instead of a shoe clothing factory shop.

In the vicinity of No. 139 Baichang East Road, Ningbo, some elderly people have kept their memories of Ningbo Yong Gang garment factory. It is no stranger to mention Zheng Yonggang.

A shopkeeper who has been in business for more than 20 years near No. 139, 100 Zhangdong Road, told the Beijing News reporters, "I came here in the 90s of last century. At that time, Zheng Yonggang was already very famous. He moved to Shanghai after he became a big business."

"Shan Shan clothing is a little earlier than YOUNGOR. At that time, fir was better than YOUNGOR. Now, is he (Zheng Yonggang) not going to make lithium batteries?"

"Zheng Yonggang is a man of courage."

Li Long (a pseudonym) is more than 70 years old. He claims to have seen Zheng Yonggang himself.

Li Long told the Beijing News reporter, "Shan Shan clothing factory was really fierce at that time, the entire Fenghua (clothing) factory adds up is nothing like it."

In the 4 storehouse of Shanghai fashion shop, a Chinese fir shop which has been open for more than 10 years, the shop assistant told the Beijing News reporter, "Shan Shan is a famous clothing brand in China. Its former spokesperson is Liu Xiang."

According to the economic observer, the market share of Shanshan brand in Western clothing market has dropped from 37.4% in 90s to 2.25% in 2015.

The Beijing News reporter noted that in 2015 and 2016, there were hundreds of fir clothing stores, and in 2015 annual reports and 2016 annual reports, there were differences in the total number of stores up to 2015. In the annual report of 2017, Shanshan stock company no longer announced the number of stores.

In this regard, Shan Shan shares told the Beijing News reporters that the divergence of data was mainly due to the withdrawal of the Brand Company part of the company's clothing business in 2016. In 2017, the company's clothing business revenue and net profit attributable to the company's total operating income and net profit to the parent were less than 10%. There was no need to disclose the number of physical stores and other related information according to the Shanghai stock exchange's "industry information disclosure guidelines No. twelfth - clothing" related requirements.

Shanshan stock was listed on the Shanghai stock exchange in 1996 and became the first listed clothing company in China.

In June 27, 2018, the brand of Shanshan was also listed on the Hongkong stock exchange of China, which is known as the two listing.

At this point, the clothing industry has been redefined, full of new retail, black technology and other concepts, and in the era of excess, all kinds of clothing brands are numerous.

Accompanying with this, Shanshan has also injected new elements. In the first half of last year, the sales income of Shanshan brand in e-commerce platform accounted for 13%.

On that day, Zheng Yonggang did not attend the ceremony of listing, and his son Zheng Ju was one of the people who beat the gong.

On the first day of listing, Shanshan brand fell below the issue price. The opening price was HK $4.51 per day and the closing price was HK $3.49 per share. As of February 15, 2019, the price of Shanshan brand is HK $1.42 per share.

Shan Shan brand announced that as of the end of June 2018, its net profit decreased from about 9 million 700 thousand yuan in June 30, 2017 to about 9.3% to 8 million 800 thousand yuan during the current period.

At the same time, from the earnings report, inventory turnover also slowed down.

According to the semi annual report released last year, the average turnover days of the group increased from 284 days to December 31, 2017 to 307 days in June 30, 2018.

According to the consumers who bought the clothing of Shan Shan, one of the characteristics of the sales of Shanshan clothing is "discount".

During the from January 3 to 7, 2019, the Beijing News reporters visited several physical stores in Ningbo and Shanghai, each of which had discount activities.

According to the clothing store clerk, "the price of fir clothing is very high, and their original price is almost the same as that of YOUNGOR, but our family discount is lower than YOUNGOR's."

The pformation of Chinese fir from clothing to new lithium power is the result of Zheng Yonggang's thinking for two years.

This pformation was once controversial.

He repeatedly explained the reasons for the pformation of Shanshan. "After the Asian financial crisis in 1997, I found that the Chinese market will be open to the world. There are two ways to go before us, one is upgrading, and the other is pformation."

Considering the actual situation of factory production mode and product design, it is difficult for the company to upgrade to the operation mode like UNIQLO and ZARA, so resolutely decided to pform.

Finally, he chose to pform lithium batteries, and Zheng Yonggang was once said "Crazy" by the people around him, because he did not understand technology, but Zheng Yonggang insisted that he thought "entrepreneurs are not ordinary people, entrepreneurs are looking for the future".

In 1999, Zheng Yonggang invested 80 million in the Anshan Carbon Research Institute, which is carrying out the 863 research project, to ensure the completion of the project. "Then invest 3 hundred million, build a factory in Shanghai, Pudong to make negative materials, and start the pformation of enterprises."

In 2015, in an exclusive interview with the first financial daily, Zheng Yonggang said that lithium batteries were saved by Jobs of Apple Corp. "We are making high-end lithium batteries (more than 30 tons), which is different from China's large quantities of parallel imports (thousands of pieces per ton)," it is not easy to find buyers at first.

After the advent of Apple phone, the requirements for lithium battery products were very strict. Researchers from the new energy industry revealed that when the global bidding was made, the materials of Shanshan and ATL company (lithium battery company) were bundled and quickly won recognition.

In the annual report of Shanshan 2014 annual report, Shanshan introduced its lithium battery new energy business: the company is the largest supplier of lithium battery composite materials in China. The production and sales of cathode materials are the first in China. The production and sales of artificial graphite in the first place is the first in China, and the production and sales of electrolytes are at the forefront of the domestic market. After years of accumulation, the company has stable and high-quality customer resources, including SDI, SONY, BYD, ATL, LISHEN, BAK and other world-renowned enterprises, and has entered the supply chain of world-famous enterprises such as apple and BENZ.

Meanwhile, the lithium battery project was put into a listed company of Shanshan stock.

In 2001, Shanshan Group bought 75% of its investment in Shanghai Shanshan science and Technology Co., Ltd. (lithium battery negative pole material project), which was purchased by its first largest shareholder, Shanshan Group Co., Ltd., which was invested by 45 million yuan. After completion of the acquisition, Shanshan Group Co., Ltd. no longer held the equity of Shanghai Shanshan technology limited company.

After introducing the lithium battery project into the listed company system, we can learn more about the operation of the project.

In the annual report of Shanshan 2002, lithium ion battery anode material has become one of the main business projects of Shanshan Group, its business profit accounted for 5.67% of the year, and other main business profits accounted for 46.43% of western suit, 35.13% of casual wear and 12.77% of shirts.

The Beijing News reporter found that in 2013, the business income of lithium battery materials exceeded clothing for the first time.

Today, lithium battery materials have become the main revenue force of Shanshan stock, and its operating income in 2017 is about 6 billion 36 million yuan, accounting for 73% of the total business revenue of the whole year.

With the pformation of enterprises, the families of Chinese fir have grown stronger and stronger.

In September 1999, Shanghai Shanshan science and Technology Co., Ltd. was incorporated in Pudong New Area, Shanghai. The main business scope of the company is the research, development and manufacture of lithium-ion battery materials and other carbon materials. In August 2004, Shanshan Holding Co., Ltd. was established in Shanghai, followed by a series of equity pfer. At present, the legal representative of Shanshan holdings is Zheng Ju, the son of Zheng Yonggang, and Shanshan is one of the shareholders of Shanshan Group, and Shanshan Group is one of the shareholders of Shanshan Group.

Slowly, with Shanshan holdings as the core, including hundreds of affiliated companies, the industrial layout is built up in the fields of science and technology, fashion, investment services, urban complex, trade logistics, tourism, medical care and so on.

Lai Yang, executive vice president of Beijing business economics society, told the Beijing News: "Shan Shan clothing is a famous brand before, but with the development of the garment industry, the whole industry is facing an impact."

In the view of Lai Yang, "enterprises must undergo pformation if they are under pressure."

The enterprise may turn to the direction which has nothing to do with the main business, because the enterprise already has the primitive accumulation of funds, if we find a field with strategic direction, and then find technical personnel, cooperative capital and market gap, then we can do it.

Shanshan investment in new energy is likely to be considered from this perspective.

According to media reports, Zheng Yonggang issued a vision in 2016: "the main source of new energy Shanshan stock, to 2018 must reach 50 billion of the market value."

By the end of 2018, the total market value of Shanshan stock was only 14 billion 506 million yuan.

To this end, in February 15, 2019, Shan Shan shares told the Beijing News: the two tier stock market performance is affected not only by the fundamentals of the company, but also by many factors such as capital size, investor preference, attention, market expectations, macroeconomic environment, and the overall market situation of the stock market.

Gradually become a new investment, Shanshan investment income soared.

The new main business lithium battery company was established in Shanghai, Shanshan holdings was established in Shanghai, Zheng Yonggang himself also went to Shanghai office, this series of changes by the media and the public known as "Zheng Yonggang led Shan Shan to leave Ningbo".

In January 7, 2019, the Beijing News reporter came to the one hundred Shanshan building in Pudong, Shanghai.

According to the staff of the one hundred Shan Shan Building in summer (a pseudonym), this building is a state-owned asset. "Soon after the building was completed, Shanshan bought three of its three storeys, so the building was called the one hundred Shanshan building. He (Zheng Yonggang) worked in this building before, and moved to the Lujiazui Finance Plaza in recent years."

Lujiazui century finance Plaza is about 20 minutes' walk from the one hundred Shanshan building. From the index card on the first floor, we know that Shanshan stock and Shanshan holdings are located on the tenth and eighteenth floors of the building respectively.

Lujiazui is one of the most influential financial centers in China.

The growing pace of the Chinese fir series has not stopped, and no longer meets the two industries of clothing and lithium power. In recent years, Shanshan has gradually built up a financial system supported by the banking and insurance industry, and has provided diversified comprehensive financial services to the outside world.

For investment, Zheng Yonggang's attitude is "business must be professionalization, but investment can be diversified".

Since its listing, the business scope of Shanshan stock has been growing again and again. The Beijing News reporter noted that "manufacturing, processing, wholesale and retail of lithium ion battery materials" was added in August 2007, and the new business also has house leasing. In April 2010, the investment scope of Shanshan stock company added "industrial project investment".

In the 2012 financial report of Shanshan stock, investment has become one of its main businesses for the first time, with a corresponding gross margin of 100%.

The overall core competitiveness of Shanshan stock has become the three major businesses of "clothing, lithium battery materials and investment". Based on industry and investment, investment has been promoted as a means to promote the overall development of the company and gradually achieve the linkage effect between industry and investment.

Investment income has also made outstanding contributions to the performance of Shanshan stock.

In 2017, Shanshan stock company realized a net profit of 896 million 115 thousand and 100 yuan attributable to shareholders of listed companies. On the one hand, it benefited from the substantial growth of the company's lithium battery material positive business performance, and on the other hand, the company sold some shares of its holding bank of Ningbo and gained an investment income of 465 million 838 thousand and 100 yuan.

In July 2018, the Bank of Ningbo issued 2017 rights and interests allocation plan in accordance with 4 yuan (including tax) per 10 shares. Shanshan shares received 67 million 12 thousand and 100 yuan in cash dividends. In the first half of last year, the company accumulated 2231700 shares of Ningbo bank stock and gained 37 million 309 thousand and 900 yuan of investment income.

In the first half of last year, Shanshan shares received 24 million 726 thousand yuan in cash dividends from Chou Chou bank.

In the first half of 2018, the long-term equity investment income of Chou Chou Bank (calculated by equity method) was 57 million 381 thousand and 700 yuan.

Its semi annual report 2018 revealed that Shanshan shares held 471204189 shares of the Luoyang molybdenum industry through the trust scheme, accounting for 2.18% of the total share capital of Luoyang molybdenum industry, and received a cash dividend of 35 million 811 thousand and 500 yuan during the current period.

The Beijing News reporter noted that in 2018, Shanshan shares disclosed 5 times to reduce the operation of bank shares in Ningbo for the 24 time, and the shareholding ratio decreased from 3.35% to 2.334%, with a total investment income of about 791 million yuan.

In December 4, 2018, Shanshan stock company announced that it would buy 30% stake in Sui Yong holding company for 936 million yuan and formally cut into the bad assets industry.

In this announcement, he was informed of the real intention of Shanshan stock holdings to reduce Ningbo bank shares, that is, "to revitalize stock resources and improve asset efficiency".

Not long after that, Shanshan shares received two enquiries and a letter of supervision from the Shanghai Stock Exchange. The content involved not only the equity auction but also the company's capital utilization.

According to the reply, the daily operation capital demand of Shanshan stock is about 2 billion yuan, and at the end of 11 2018, Shanshan stock has 4 billion 53 million yuan of available financial assets.

For Shanshan to enter the bad assets industry, Lai Yang analysis said: "at present, under the pressure of the economy, many enterprises have encountered the problem of cash flow difficulties, so there are many high-quality assets selling at a low price in the market. At this time, if the enterprises have enough strength and optimistic about certain resources, the choice of takeover can be said to be a cheap opportunity.

As far as fir is concerned, it can be said that it is a strategic approach, finding market opportunities, and exploring it immediately.

The trade logistics sector is also one of the important profit growth points of Shanshan enterprises in recent years. It owns Ningbo airport logistics, Shanghai Shanding international, Shanshan products, Ningbo crafts China World Trade Center, Ningbo handicrafts import and export company, Shanshan medicine investment, Ningbo international cooperation company and Hui Xing Trade and other logistics trade platform; Shanshan tourism is a cultural tourism sector built by Shanshan holding company, and is also one of the strategic focuses of Shanshan's future development.

The medical and urban complex of Shan Shan is part of the diversified layout of the Chinese fir.

In the urban complex plate, it is mainly the Shanshan Group and the Japanese Mitsui realty Co., Ltd. and other enterprises jointly invest in the construction of large projects such as orter.

From clothing, lithium power to investment, Shanshan "diversification" cross-border footsteps have not stopped.

(Beijing News)