Changying Precision New Energy Vehicle Business Speed Up Again, Invest 2 Billion Yuan To Build Production Line To Support Ningde Era

On January 4, Changying precision (300115. SZ) further expanded its layout in the field of new energy vehicles.

On the evening of that day, Changying precision announced that it planned to invest a total of 2 billion yuan to build three automatic production lines of power battery structural parts. In addition, Changying also announced that from December 12 to December 31, 2020, the company and its subsidiaries had received a total of 13.4871 million yuan of government subsidies.

Affected by the good news, Changying precision rose sharply on January 5, up more than 11%. As of the end of the 5th, Changying precision rose 8.74% to 30.62 yuan / share.

New projects put into production are close to Ningde times

Changying precision investment in the construction of three power battery structural parts automation production line projects are distributed in three regions of the country.

Specifically, the wholly-owned subsidiary of Changying plans to invest in the construction of Yibin Changying new energy automobile power battery structural parts automatic production line project in Yibin City, Sichuan Province. The initial investment amount of the project is 1.2 billion yuan, and the construction period is not more than 24 months. Changying plans to invest in the construction of Changzhou Changying new energy automobile power battery structural parts automatic production line project in Liyang economic and Technological Development Zone, Changzhou City, Jiangsu Province, with an investment amount of no more than 500 million yuan and a construction period of no more than 18 months. Changying plans to invest in the construction of Ningde Changying new energy automobile power battery structural parts automatic production line project, with an investment amount of no more than 300 million yuan and a construction period of no more than 6 months.

Changying precision said in the announcement that the new energy vehicle market has a broad prospect, and the investment and construction of the new project "will further improve the company's production capacity layout and meet the needs of business development and market expansion of the company's new energy power battery structural parts".

In the announcement of Fujian Ningde investment and construction project, Changying precision specially pointed out that this investment and construction is "to support important customers nearby and strengthen the company's competitive advantage". The 21st century economic reporter noted that the location of Changying precision's new production line project is the same as the 39 billion yuan expansion project announced in Ningde era before, all located in Yibin, Sichuan, Liyang, Jiangsu and Ningde, Fujian. The weight of "important customers" in Changying announcement is self-evident.

In this regard, an analyst of the seller's power new industry told the reporter of the 21st century economic report that "at present, it is generally the trend (to set up plants in the same place) in the new energy industry.".

The electronic team of China Merchants Securities also pointed out that the investment and expansion of Changying precision is to match the targeted layout of Ningde era's over expected capacity expansion. It can not only further improve the service and delivery ability of fixed-point supporting customers, but also facilitate further close cooperation and research and development with customers in the long-term.

In fact, Changying precision and Ningde era have already joined hands in this expansion.

On June 21, 2018, Changying precision, that is, when investigating the company by institutional investors, replied that Shenzhen Changying established a cooperative relationship with Ningde times, and obtained its supplier qualification, and had carried out small batch trial production of its existing products.

In addition, Ningde times also participated in the 1.9 billion fixed increase project completed by Changying precision in November 2020.

According to the fixed increase report disclosed by Changying on November 12 last year, the seventh largest investor in the number of shares allocated was Changjiang chendao (Hubei) new energy industry investment partnership (limited partnership). According to qixinbao data, Ningbo Meishan bonded port area wending Investment Co., Ltd., which owns 15.87% of the shares, is 100% controlled by Ningde times parent company (Ningde Times New Energy Technology Co., Ltd.).

According to the previous announcement, an important investment direction of Changying precision's 1.9 billion fixed increase project is Shanghai Lingang New energy vehicle components (phase I) project. The project period is expected to be 18 months, the total investment is expected to reach 1.092 billion yuan, and the total amount of raised funds is planned to be 900 million yuan.

Changying precision said the fund raised by the project is expected to be used for the construction of high and low voltage electrical connectors, power cell structural parts and hydrogen fuel cell bipolar plate projects.

New energy vehicle business has become an important growth point of performance

According to the public information, Changying precision is a manufacturer mainly engaged in the R & D, production and sales of precision electronic components. Its main products and services include consumer electronic precision structural parts and modules, electronic connectors and precision small parts of intelligent electronic products, connectors and modules of new energy vehicles, robots and industrial Internet, etc.

As a manufacturer of mobile phone business, Changying precision has been adjusting its business layout since its listing, and new energy vehicle business is also its new business line.

From 2010 to 2013, Changying precision started from shielding small parts and connector business, and gradually reached cooperation with Huawei, Samsung and other domestic and foreign customers. From 2014 to 2017, Changying transformed CNC metal structural parts, followed the trend of mobile phone case metallization, and began to lay out waterproof, semiconductor and new energy vehicle business. Starting from 2019, the company actively adjusts the structure of customers and products, turning to international customers and non mobile business.

In the 2020 semi annual report, Changying precision said that the proportion of non mobile phone business revenue in the reporting period has exceeded 50%.

In terms of new energy vehicle business, Changying precision got the product certification of automobile industry as early as 2012. In 2015, Changying precision began to set up a business unit in Kunshan to supply famous auto parts suppliers such as magna.

From 2016 to 2017, Changying precision successively acquired 30% and 70% shares of Suzhou collent, started to enter Tesla's supply chain, and gradually became an important supplier of new energy vehicle components for the latter, and occupied the core supply share of some high-precision products. Changying precision reported in the half year of 2020 that the company's revenue to Tesla increased by 31.42% year-on-year.

At present, Changying precision new energy vehicle business covers products such as power battery structural parts (such as cover plate), high-voltage connector bus bar (busbar), precision automotive electronics, charging related equipment (such as charging gun and charging pile), etc.

After three years of development, Changying new energy vehicle business revenue has increased from 54 million yuan in 2017 to 405 million yuan in 2019, accounting for 4.7% of business revenue in 2019.

This time, Changying precision investment and construction of power battery structural parts business will generate tens of millions of yuan in 2020, and the main customer is Ningde era.

According to the financial report data, at present, the proportion of power battery structural parts business in Changying precision revenue is still small. In the third quarter of 2020, Changying precision achieved 6.75 billion yuan of operating revenue, with a year-on-year growth of 9.07%, and a net profit of 413 million yuan, a year-on-year increase of 119.32%.

Industry insiders believe that the future space of power battery structural parts market is very considerable, and the global market is expected to reach 100 billion in 2025. Many securities companies have predicted that the investment and construction of the power battery structural parts production line will increase the revenue of Changying precision new energy business.

According to CITIC Securities, Changying precision power battery structure parts, including cell structure parts and pack structural parts, are expected to increase the single vehicle value to about 7000-8000 yuan. After the production line is put into construction, the company's new energy vehicle business will reach 500 million yuan, 1-1.3 billion yuan and 2.5-3 billion yuan in 2020-2022, and is expected to achieve a scale of 10 billion yuan in 2025. According to the prediction of China Merchants electronics, from 2020 to 2022, Changying precision The revenue of new energy vehicle business is expected to reach 500 million, 1-1.5 billion and 2-3 billion yuan.

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