With the increasing attention of people to the energy saving and emission reduction of automobiles, countries for fuel consumption and emissions of fuel vehicles increasingly stringent regulations, in this context, through the lightweight reduction of vehicles to reduce energy consumption has become the major car companies to deal with the goal of energy conservation and emission reduction of the technical path, experimental research shows that about 75% of the fuel consumption and vehicle quality is related, the quality of the car every 10% drop, fuel consumption fell by 8%, emissions reduced by 4%.
The reduction in the quality of the car not only reduces fuel consumption, but also brings about improvements in other aspects such as driving safety and driving comfort. With the increase of consumer demand for car driving, the economy, safety and comfort brought by lightweight will be more in line with consumer demand, and the advantages of lightweighting will be more obvious. Aluminum alloy castings (belonging to metal parts) and injection molded parts (belonging to plastic parts) are increasingly used in the automotive industry.
Zhitong Finance APP learned that Jiangsu Nutaige Technology Co., Ltd. (hereinafter referred to as: Nüitege) is committed to the sale of automotive suspension shock absorption support, suspension system plastic parts, interior and exterior plastic parts and other auto parts products that adapt to the trend of automobile lightweight, energy saving and environmental protection. The company has also established good business relations with BASF, Tiannak, Wandu, Showa, ZF, Kaibi, Yanfeng Bio, Huayu Vision, Toyo Rubber and plastics and other well-known auto parts suppliers at home and abroad, and the products are mainly used in Volkswagen, Mazda, Honda, General Motors, Nissan, Geely, Chery, Changan and other hot models of automobile brands. As a recruit who is about to land on the GEM, what is the strength of Newtek?
The trend of automobile lightweight is gradually rising, and the growth space of aluminum alloy parts is vast
Low-carbon economy is an inevitable choice to achieve sustainable development in the future, in the context of increasingly severe environmental protection and energy pressure, energy conservation and emission reduction has been listed as the basic national policy of the mainland, and the society pays more and more attention to the performance of automobiles in weight reduction, energy saving, safety and efficiency. In the future, automotive products will focus on environmental protection, and will be developed in new power and selected raw materials
The harmony between the car and the environment is fully reflected in the links of use, automobile use and scrapping.
Lightweight is the key technological development route of automobile "energy saving and emission reduction". The lightweighting of the future car is actually the lightweighting of parts. In recent years, automotive castings have been continuously replaced by low-density aluminum castings, and the amount of ferrous metals such as steel in new generation automobiles will be greatly reduced, while the use of aluminum-magnesium alloys and plastic parts will increase significantly.
The large-scale application of aluminum alloys in automobiles began in the 1970s and has become an automotive material with a dosage second only to steel and cast iron. More than 12%-15% of global aluminum consumption is used in the automotive industry, and some developed countries have exceeded 25%. With the improvement of technology and technology, aluminum instead of steel is becoming a trend of automobile lightweight on a global scale.
According to the "Aluminum Quantity Assessment Report for China's Automotive Industry (2016-2030)" released by the International Aluminum Association,
In 2018, the average aluminum consumption of new energy vehicles in mainland China was about 141.5 kg, and the average aluminum consumption of fuel vehicles was about 118.7 kg, compared with developed countries such as the United States and Japan, there is still a big gap in the amount of aluminum used in mainland vehicles.
More importantly, the vigorous development of the new energy automobile industry has further stimulated the demand for automobile lightweighting. Because new energy vehicles are equipped with three-electric systems and a large number of intelligent equipment, they have a large weight increase compared with traditional energy vehicles. At the same time, based on the current electric vehicle energy supply and energy storage technology, the short mileage and the battery life anxiety caused by the inconvenience of charging are still important problems facing the new energy automobile industry. In this context, through the application of lightweight technology, reducing the weight of vehicles and increasing the mileage of new energy vehicles has more important significance.
According to the "Energy-saving and New Energy Vehicle Technology Roadmap" compiled by the Society of Automotive Engineers of China, the target for aluminum for bicycles in mainland China in 2020 is 190 kg, the target for aluminum for bicycles in 2025 is 250 kg, and the target for aluminum for bicycles in 2030 is 350 kg. In short, with the growth of automobile production and the increase in the amount of aluminum used in automobile bicycles, aluminum alloy parts will gain greater market space in the process of promoting automobile lightweighting.
There is an impact on aluminum prices on the top, and there are customers who have lower prices
Since its establishment in 2010, with years of experience in the production and technology of aluminum alloys and plastic parts, Mainly focusing on the field of automotive suspension system parts, on the basis of the suspension system plastic parts business, the company began to extend to the field of automotive interior and exterior plastic parts. Among them, suspension system components contributed more than 60% of revenue.
From 2018 to the first half of 2021 (hereinafter referred to as the reporting period), the company's business scale increased year by year, achieving operating income of 287 million yuan, 413 million yuan, 496 million yuan and 263 million yuan, respectively; from 2019 to the first half of 2021, it increased by 43.96%, 19.93% and 49.05% respectively; and the net profit was 50.8564 million yuan, 42.9987 million yuan, 57.4268 million yuan and 29.3586 million yuan, respectively. From 2019 to the first half of 2021, it increased by -15.45%, 33.55% and 186.99% respectively.
In 2021, Nuiteg achieved operating income of 549 million yuan, an increase of 10.71% over the previous year, and net profit attributable to the company's common shareholders was 52.513 million yuan, down 8.56% from the previous year. In 2021, the company's net profit decreased year-on-year, mainly due to the increase in global commodity prices, the company's main raw material aluminum ingots and some specifications of plastic particles procurement costs increased, resulting in a decline in the gross profit margin of the main business.
In the view of Zhitong Finance APP, in the auto parts supplier industry, the concentration of most segments is relatively low, as a second-tier supplier of vehicle manufacturers, it is even more in the gap between a strong first-tier supplier and an upstream raw material supplier. As a second-tier supplier, the upstream is plagued by the rise in aluminum prices, the downstream faces strong large customers, and there is no bargaining power, in recent years, the gross profit margin has declined year after year, during the reporting period, the company's gross profit margin was 42.23%, 33.22%, 28.74%, 26.89%.
According to the prospectus, the main raw materials used by Nuster for production are aluminum ingots and plastic particles. During the reporting period, the proportion of the company's direct materials in the current production cost was more than 50%, accounting for a relatively high proportion. Since 2021, due to the large-scale stimulus program introduced by the governments of major economies around the world, the implementation of ultra-loose monetary policies by central banks of major economies, the global liquidity environment has continued to be extremely loose, coupled with the obvious rebound of the epidemic outside the country, there are still constraints on the supply side, and global commodity prices have shown an upward trend.
Affected by the recent increase in commodity prices, the purchase price of the company's main raw material aluminum ingot in the first half of 2021 increased by 17.67% compared with the average purchase price in 2020; the plastic particles of functional parts and the plastic particles of interior and exterior decoration increased by 6.05% and 15.99% respectively compared with the average purchase price of 2020. The increase in raw material prices in 2021 also led to an increase in cash payments for raw materials purchased, and net cash flow from operating activities decreased year-on-year.
If the price of major raw materials continues to rise significantly, it will lead to a decline in the gross profit margin of the company's products, which will adversely affect the company's operating performance. Newtek can only digest the above effects in two ways, one is to reduce costs through scale effects, and the other is to adjust product prices. However, in the face of strong Tier 1 suppliers, especially nearly half of the company's revenue comes from BASF, the price of Newage's products can only fall again and again. Raw material prices have risen sharply, and there is a lack of bargaining power for downstream large customers, and the business experience of New tiger secondary suppliers is not good.
Nearly half of its revenue comes from BASF
At present, the domestic market has the production capacity of polyurethane for automotive shock absorption for BASF, Kaizhong and Elsekirch, all three of which have entered the supply chain system of automakers. BASF is the world's largest supplier of polyurethane materials for automotive shock absorption, and is also the first parts and components enterprise to develop and supply polyurethane suspension shock absorbing support assemblies, and its domestic business entities are BASF Polyurethane Specialty Products (China) Co., Ltd. and BASF Polyurethane (China) Co., Ltd.
Basf's polyurethane materials for shock absorption include polyurethane bumper blocks and suspension shock absorber support assemblies, which are used in mainstream vehicle brands such as Volkswagen, Honda, Mazda, General Motors, SAIC, Geely, Audi and Fiat.
BASF's market position as a Tier 1 supplier, especially as a pioneer in the supply of components for polyurethane suspension shock support assemblies, is evident. As a result, Newtek's presence is even understandably business dependent on it. During the reporting period, the company's sales to BASF, the company's largest customer, accounted for 66.25%, 57.05%, 45.19% and 46.98%, contributing half of Newage's revenue.
Specifically, at present, the company's suspension shock absorption support business customers are mainly BASF, the amount of revenue is large and accounts for a higher proportion of the main business income, during the reporting period, the company to BASF to provide supporting suspension shock support business to achieve revenue of 133 million yuan, 202 million yuan, 196 million yuan and 109 million yuan, accounting for 46.85%, 49.38%, 40.46% and 42.41% of the main business income in the same period. The development of the suspension shock support business mainly depends on BASF's development of end customers, and if BASF's polyurethane suspension shock support business is not well developed, the development of the suspension shock support business provided by the company to BASF will be adversely affected.
According to zhitong financial APP observation, in order to reduce the dependence on BASF, Newtek has continued to develop new customers in recent years. During the reporting period, the company has begun to supply a series of well-known auto parts suppliers at home and abroad, such as Yanfeng Plastics, Toyo Rubber and Plastics, Huayu Vision, Kaizhong Shares, Anhui Zhongding, etc., as well as Geely Automobile, Mazda and other OEMs. As of the end of June 2021, the company has obtained the project designation of Yingzhi Automobile, Schaeffler, NingjiangShanchuan and Wanxiang, but has not yet been supplied in bulk, and has passed the new supplier access audit for new customers such as BorgWarner, Magna, SAIC Motor Group Co., Ltd. Passenger Car Branch, Great Wall Motor and Volvo Cars.
However, the project development cycle of the automotive industry is long, so the time interval between the project designation and the mass production of the product is relatively long, and the customer's prediction of the mass production time and mass production scale at the project point is affected by the project development schedule, market environment and other factors, and there is usually a certain difference with the actual situation in the future. In addition, customers generally use bidding to select suppliers of specific products among their qualified suppliers, so new supplier access audits for Newage new customers do not mean that the company has obtained or will immediately obtain project designations or orders. Therefore, Nurteg's BASF "dependence" cannot be effectively alleviated in the short term.
Investors want to invest in "good industries, good companies", and the good companies in the industry are undoubtedly rooted in the highest part of the industry value chain, because even if the overall growth rate of the entire industry is limited, the profits of good companies are always good, and the corresponding investors can still get more considerable returns.
From the perspective of the automotive industry chain, whether it is the industrial chain of fuel vehicles or electric vehicles, the market concentration of first-tier suppliers is relatively high, which is the highest profit margin in the automotive industry chain. The concentration of downstream vehicle manufacturers and secondary suppliers is actually relatively low, it is inevitable that there will be a price war, and the procurement of raw materials by secondary suppliers is also under the pressure of commodity price increases, which is difficult to pass on at present. Therefore, whether Newtek can gain the favor of investors after the listing depends on whether it can expand its market share and become the leader among secondary suppliers.