#聚光创作大赛#
Author / Avocado under the stars
Edit/Spinach's Starry Sky
Typesetting/Leeks under the stars
Recently, Belden Energy (001376), as the finale of the approval system, has received great attention from the secondary market, and its stock price has risen for four consecutive trading days.
Source: Oriental Fortune official website Belden Energy (as of April 12, 2024)
This wave of stock price gains is mainly due to the heat of the power sector. The market expects that the price of coal will decline year-on-year, the price of electricity and electricity will rise, and the profit margin of thermal power enterprises will expand. It's just that although the stock price is hot, Belden's performance is not glamorous, and it is still moving forward with a heavy load.
First, the business is regional, and the growth is worrying
From a business point of view, Belden Energy mainly provides central heating services for enterprises in industrial parks and industrial clusters through the construction of cogeneration systems and heating boilers. The so-called cogeneration system is actually an energy-saving system that can generate both heat and electricity. Specifically, Belden uses coal as the main fuel to generate steam in boilers to supply steam (for heating or cooling) to industrial enterprises in the heating area. In addition, the co-product power is sold directly to the State Grid.
Source: Internet
Therefore, Belden's revenue mainly comes from two sources: steam and electricity, and the steam business is the main source.
In 2023, Belden's total revenue will be about 1.082 billion yuan, of which the steam business will generate about 994 million yuan, accounting for 92%, and the power business will only generate 82 million yuan, accounting for only 8%.
Source: Straight Flush iFinD - Revenue Structure
Due to the limitation of the radius of the heating pipe network, the central heating and cogeneration business presents obvious regional distribution characteristics. According to the "Measures for the Administration of Combined Heat and Power", the heating radius of the cogeneration unit with steam as the heating medium is generally considered to be 10 kilometers, and other heat sources are not planned and constructed within the heating range in principle.
According to the data, although Belden Energy has business layout in Jiangsu, Shandong, Jiangxi, Guizhou and Hubei, it mainly relies on Jiangsu to generate revenue. In 2023, Jiangsu's revenue will account for 57.43%.
Although the business is regionally distributed, although it has regional exclusive competitive advantages, on the other hand, performance growth is easily limited.
Here's an example. One manufacturing plant, one factory building, products can be sold all over the world. However, for Belden Energy, a cogeneration unit can only provide heat within a radius of 10 kilometers.
Since 2022, Belden's revenue growth has declined, and by 2023, the growth rate has changed from increasing to declining.
Source: Straight Flush iFinD - Operating Income
Second, the increase in projects, insufficient financial strength
Then, if you want to increase your business, you can only increase the "cogeneration unit", that is, make an investment. Real money is required for investment. However, as of the end of 2023, Belden only has 188 million funds left on its books (210 million in 2023 IPO).
Not only that, but this little bit of family background also has to bear the pressure of repaying debts. According to the data, since its listing in 2023, Belden Energy's current ratio and quick ratio have improved, but they are still only 0.85 and 0.61, respectively, which are significantly low. The pressure of debt repayment is huge, what else to talk about investment and business?
Source: Straight Flush iFinD – solvency analysis
Lack of money can not be carried out, no performance will only be more lack of money, Belden has been in a deep development dilemma.
In order to solve the difficulty, Belden embarked on the road of slow financing.
On January 9, 2024, Belden first announced that it would apply for a comprehensive credit line of no more than 1.5 billion yuan from banks and other financial institutions, and its actual controller Zhang Chunlong and his spouse Li Guohua would provide free guarantees.
Source: Company announcement (9 January 2024)
On March 15, the company also announced that it would apply for the issuance of shares with a total financing amount of no more than 300 million yuan and no more than 20% of the net assets at the end of the most recent year to specific targets through simplified procedures.
Source: Company announcement (15 March 2024)
is so tight, the tightness of the days can be seen.
Third, the power business, accounting for a relatively small amount
The rise in the power sector is mainly due to the following market expectations: First, the market expects an increase in electricity demand. With the recovery of the economy and the recovery and growth of industrial production, coupled with the fact that temperatures across the country are starting to rise, the market expects that the power load will increase and the demand for electricity will increase in the future.
Second, the price of electricity will rise. Recently, the 2024 annual electricity trading transaction prices of various provinces have been announced one after another, and the market expects that the annual long-term electricity prices in most provinces will maintain a high proportion of increases.
In addition, the cost of coal is reduced. Market expectation: In 2024, coal prices are still expected to be at a low level, coal prices will fall, and the operating capacity of thermal power generation enterprises will further improve.
Lower costs for revenue growth, of course, are positive. However, for Belden, it wasn't so perfect.
First, the proportion of power business is small. In 2023, the electricity business will account for only 8% of revenue, less than 10%. Even if it's good, it can't stir up any big waves.
Second, the decline in coal prices can indeed reduce the cost of Belden. However, for an enterprise, the effect of reducing costs and increasing efficiency is very limited, and the key to creating good revenue is open source.
With the decline of pillar business and the limited development of funds, Belden Energy is moving forward with a heavy burden.
Note: This article does not constitute any investment advice. The stock market is risky, and you need to be cautious when entering the market. There is no harm in buying and selling.