Trainee reporter Wen Yan
"What is the reason why the transaction price is not agreed?"
"Is there a follow-up plan to acquire 55% of Huakun Zhenyu's equity?"
"Do you still lay out computing power?"
On the afternoon of April 20, High-tech Development held an investor briefing on the termination of major asset restructuring. At the meeting, a reporter from China Fund News found that investors were enthusiastic about asking questions, and focused on the above three points.
Previously, High-tech Development planned to acquire 70% of the shares of Huakun Zhenyu. Based on the fact that Huakun Zhenyu is a computing power industry chain enterprise and a partner of Huawei's Kunpeng ecosystem, the stock price of High-tech Development rose sharply, but the transaction was terminated recently.
At the same time, high-tech development has won two consecutive fall limits since April 18. As of the close of trading on April 19, the share price of high-tech development was 44.91 yuan / share, compared with the previous highest point of 95.70 yuan / share.
In response to investors' questions about the reasons for the termination of the transaction plan, He Zhaofeng, general manager of High-tech Development, provided three information points: the counterparty, the transaction price, and the computing power hotspot.
He Zhaofeng said that since the second half of 2023, the computing power industry has become a hot spot in the market. Considering that the transaction lasted for a long time, the industry in which the target company was located was affected by the internal and external environment, the market expectation was high, and the audit and evaluation results involved had not yet been determined, the listed company and some counterparties failed to reach an agreement on the transaction price.
The counterparties to the transaction in which High-tech Development intends to acquire 70% of the equity of Huakun Zhenyu include Chengdu High-tech Investment Electronic Information Industry Group Co., Ltd. (hereinafter referred to as "High-tech Investment Electronics Group"), Gongqingcheng Huakun Zhenyu Investment Partnership (Limited Partnership), and Hainan Yunchen Heye Technology Partnership (Limited Partnership) (in January 2024, Pingtan Yunchen Technology Partnership (Limited Partnership) was renamed).
Some investors speculated at the briefing that as the largest underwriter of Huawei's computing power, combined with the market value of other listed companies in the same industry as a reference, the current valuation of Huakun Zhenyu may be between 30 billion yuan and 50 billion yuan, and the current valuation of 55% of Huakun Zhenyu held by CDHTI Electronics Group is about 16.5 billion yuan to 27.5 billion yuan.
The problem is that in the process of high-tech development's planning to acquire 70% of Huakun Zhenyu's equity, Huakun Zhenyu's 22% equity was transferred in December 2023 at a transaction price of 638 million yuan.
According to the transaction price in December 2023, the valuation of 100% equity of Huakun Zhenyu is 3.19 billion yuan. When High-tech Development announced that it intends to acquire 70% of the equity of Huakun Zhenyu, it is expected that the valuation of 100% of Huakun Zhenyu's equity will be 3 billion yuan.
That is, in December 2023, the valuation of 100% of Huakun Zhenyu's equity is still relatively stable, but only 4 months later, investors predict that the valuation will become 30 billion yuan to 50 billion yuan.
In view of the valuation of 100% equity of Huakun Zhenyu, the previous acquisition plan of High-tech Development is estimated to be about 3 billion yuan, with an appraised value-added rate of 1354.05%, corresponding to a static P/E ratio of 69.11, which is significantly higher than the static P/E ratio of 32.68 of comparable companies.
At that time, the Shenzhen Stock Exchange issued a letter of inquiry, issuing "seven questions" on the proposed acquisition of 70% of the equity of Huakun Zhenyu by High-tech Development.
Among them, Huakun Zhenyu's revenue scale has changed greatly in the past three years, and the revenue growth rate is significantly higher than that of comparable companies. The Shenzhen Stock Exchange requires high-tech development to explain the reasons and reasonableness of the sharp increase in the revenue scale of Huakun Zhenyu since its establishment, and the authenticity of the performance during the reporting period.
At that time, High-tech Development responded that Huakun Zhenyu entered the market late, the company was small in the early stage of its establishment, and the increase in operating income was more obvious, and based on technical reserves, product performance, and brand advantages, it had higher growth space and growth potential.
According to the company's official website, Huakun Zhenyu is a leading enterprise in the domestic intelligent computing and storage integrated computing power industry. Its Tianzhi AT800 (Model9000) AI training server is a nationally produced Al training server based on the "Kunpeng + Ascend" processor.
Huakun Zhenyu's revenue has changed greatly, mainly because it is backed by Huawei. As of September 2023, Huakun Zhenyu has obtained the only "Kunpeng + Ascend" dual leading certification among Huawei's ecosystem partners, and has achieved many achievements such as Kunpeng TOP1, Ascend TOP1, and Finance TOP1.
However, Huakun Zhenyu's net profit margin is low, with net profit margins of 1.05%, 1.27% and 1.19% in the first three quarters of 2021, 2022 and 2023 respectively (unaudited data).
"In the face of major development opportunities brought about by national strategies such as independent innovation and eastern data and western computing, the company will actively explore the layout of the computing industry. Ren Zheng, chairman of high-tech development, said at the briefing that the company's board of directors and management will continue to actively transform to the advanced technology industry.
Specific to the relevant equity acquisition of Huakun Zhenyu, the high-tech development securities department recently said that the possibility of the implementation of the original plan is very small, and whether the subsequent acquisition will be promoted depends on the possibility of other plans.
This is also the question that investors pay more attention to: "Will there be a new plan?"
"The company will promote the acquisition of relevant equity and obtain control of the target company. Ren Zheng said that in the future, the company will combine strategic planning, industry development trends, the operation of the target company and other factors, and consider the intentions of the shareholders of the target company, continue to negotiate with other shareholders without violating the principle of making commitments, and firmly continue to promote the acquisition of follow-up assets.
Investor question: Is there a plan for injecting 55% of the equity of Huakun Zhenyu held by CDHTI Electronics Group into high-tech development?
According to industrial and commercial information, the controlling shareholder of Hi-tech Development is Chengdu Hi-tech Investment Group Co., Ltd. (hereinafter referred to as "CDHTI Group"), and CDHTI Electronics Group is a wholly-owned subsidiary of CDHTI Group. That is, the holding of high-tech development and high-tech electronic group is the same, and the two are brother companies.
Wei Jing, deputy general manager of the CDHTI Electronics Group, said that the CDHTI Electronics Group will firmly support the transformation of high-tech development to high-tech industries in accordance with laws and regulations under the overall planning of the CDHTI Group.
At present, the largest source of revenue and profit for high-tech development is the construction industry, and the power semiconductor business has established a new main business with hard-core technology for strategic transformation. The company's revenue in 2023 will be 8.008 billion yuan, a year-on-year increase of 21.88%, and the net profit attributable to the parent company will be 366 million yuan, a year-on-year increase of 83.82%.
Pictured: Part of the financial data of the 2023 annual report of high-tech development
He Zhaofeng said that in the face of the sustainable development opportunities brought about by national strategies such as independent innovation, digital economy, and eastern and western computing, high-tech development will take strategic emerging industries such as digital economy, information innovation, and new energy as the direction, and form a strategy for the integrated development of the three major businesses of "power semiconductor + basic computing power + smart building".
The reporter noted that Chengdu High-tech Zone, where the high-tech development headquarters is located, is becoming an important place for the development of the artificial intelligence industry.
On November 25, 2023, the General Office of the Sichuan Provincial People's Government issued the "Development Plan for Sichuan Development Zone (2023-2027)", which clearly takes Chengdu High-tech Zone as the core area, radiates and drives Chengdu Economic Development Zone, Longtan Industrial Concentrated Development Zone, Wenjiang High-tech Zone and other development zones, further promotes industrial intelligence and intelligent industrialization, relies on the advantages of computing resources to promote the integrated development of artificial intelligence algorithms, computing power and data, and strengthens artificial intelligence technology innovation.
Recently, the regulatory authorities have issued a number of new policies around the mergers and acquisitions of A-share companies, including strict supervision of cross-border mergers and acquisitions and encouraging industrial integration.
According to a recent research report released by a brokerage, compared with previous policies, the new M&A and restructuring policies since 2024 have two distinctive features:
The first is to encourage industrial mergers and acquisitions, especially to encourage large companies in the leading position in the industry to further consolidate their industry position through mergers and acquisitions;
The second is to clearly and strictly supervise backdoor listings and blind cross-border mergers and acquisitions, and resolutely crack down on shell speculation.
According to the analysis of industry insiders, this is the first time that the regulatory authorities have clearly proposed to strictly supervise backdoor listings and blind cross-border while encouraging the industrial restructuring of listed companies.
Cross-border mergers and acquisitions in the A-share market have gradually decreased in recent years. The above-mentioned brokerage analyzed the reasons in the research report, saying that most of the M&A targets with seriously substandard performance commitments are in emerging industries and asset-light industries, and they are generally cross-border acquisitions.
From the perspective of the industry, the above-mentioned actions of the regulatory authorities can not only further activate the optimal allocation function of the A-share market, but also are expected to optimize the overall ecology of the domestic capital market. The investment logic of A-shares will also change significantly.
For high-tech development, in the future, it is still necessary to undergo many tests to acquire part of the equity of Huakun Zhenyu and then cross the computing power industry.
Editor: Captain
Review: Muyu