Written by | Zhang Bin
Edit | Jane
As a local financial observer, we have always maintained a high degree of attention to Qinchuan machine tools (000837). Today, we will explain to the jelly beans a piece of news about Qinchuan machine tools.
On the evening of September 2, Qinchuan Machine Tool released a non-public stock issuance report, and the company's one-year-long lock price increase was officially concluded. The company's actual non-public issuance of 206 million A-share shares, the issuance object is the controlling shareholder Fast Group, the issue price of 3.88 yuan per share, the total amount of funds raised is nearly 800 million yuan, mainly invested in high-end intelligent gear equipment development and industrialization and other projects, further increasing the main business.
According to the closing price of 13.6 yuan / share on September 15, it has increased by 2.5 times from the issue price, and fast profit is about 2 billion.
<h1 class="pgc-h-center-line" data-track="11" under the >: performance and stock price fly together</h1>
Fast's participation in the fixed increase of Qinchuan shares, the reason for the large floating profit, and the recent explosion in the capital market "industrial mother machine" theme is not unrelated.
According to the information on the official website of the State-owned Assets Supervision and Administration Commission of the State Council on August 19, the Party Committee of the State-owned Assets Supervision and Administration Commission recently held an enlarged meeting, which emphasized: It is necessary to put scientific and technological innovation in a more prominent position, promote the active integration of central enterprises into the national basic research and applied basic research innovation system, strengthen key core technology research for industrial mother machines, high-end chips, new materials, new energy vehicles, etc., strive to create original technology "source", shoulder the responsibility of the "chain master" of the industrial chain, carry out special actions to supplement the chain and strengthen the upstream and downstream industries. Actively promote the development of small and medium-sized enterprises.
As a local financial recorder, as soon as this news came out, we published an article "A meeting of the SASAC: Qinchuan "mother machine" rose by 33% in 4 days", with the convening of a meeting of the SASAC, this time it really brought fire to the "industrial mother machine" sector, and the relevant stocks "rose" at the end of August, leading the rise of the two cities.
As far as Qinchuan shares are concerned, in just 9 trading days from August 19 to August 31, the company's stock price rose from less than 9 yuan per share to 15.03 yuan per share, a cumulative increase of 65%.
For the outbreak of the "industrial mother machine" sector, Wang Ke, chief analyst of the local securities company Kaiyuan Securities Machinery, said that the machine tool industry maintains a high degree of prosperity, and the update cycle drives the demand to increase. The machine tool industry continues the growth trend in the second half of 2020, showing a good state of supply and demand. At the same time, the update cycle drives the demand for metalworking machine tools to increase, the service life of the machine tool is generally 10 years, and the peak period of the last round of production is 2011, so the peak of machine tool replacement has arrived, and the demand for the whole year is expected to further increase.
The statistics of key contact enterprises in the machine tool industry in the first half of this year show that the overall operating income of China's machine tool industry in January to June increased by 45.7% over the same period of the previous year, and the increase in the same period of 2019 also reached more than 25%, and the increase in total profits was much higher than the increase in operating income compared with the same period of the previous year and the same period in 2019. The economic operation of China's machine tool industry in the first half of the year continued to maintain steady growth, and profitability rebounded steadily. (Data from the monthly statistical analysis report of key contact enterprises in China's machine tool industry)
In the "performance is king" A-share market, good performance is also the driving force and source of the continuous rise of Qinchuan machine tool stock price. The performance of Qinchuan machine tools in the past two years also reflects the high prosperity of the machine tool industry in the past two years from the side.
During the 8-year period from 2012 to 2019, the overall increase in revenue of Qinchuan shares did not increase profits, and the net profit attributable to the mother after deducting non-deductions was negative for consecutive years. In 2020, the net profit attributable to the mother after deducting non-deduction of Qinchuan shares finally turned into a profit, about 42 million yuan.
It is gratifying that Qinchuan machine tool is still continuing its good performance in the first half of this year. According to the semi-annual report, Qinchuan Machine Tool's net profit attributable to the mother after deducting non-deductions in the first half of this year was 124 million yuan, an increase of 945.91% year-on-year. This is also the first time since the listing of Qinchuan Machine Tool that the semi-annual net profit has exceeded 100 million yuan.
<h1 class="pgc-h-center-line" data-track="88" > Save Qinchuan Serial Moves: Industry + Capital</h1>
For more than thirty years, China's development can be seen, from the initial weak industrial base, to the manufacturing power, and then to the manufacturing power, which is closely related to the machine tool industry, one of the three pillars of industrial manufacturing.
Public data show that from 2001 to 2011, the output value of China's machine tool industry increased tenfold in this decade, and the profit increased by 22 times, with an average annual compound growth rate of 24.8% and 33.2%, respectively. Since 2002, China has become the world's largest machine tool consumer market, by 2009, China's machine tool output value and output have ranked first in the world. In 2011, The size of China's metalworking machine tool market reached a record $39.09 billion, the highest in the calendar year.
As the cradle of machinery manufacturing, since 2012, the machine tool industry has ushered in a watershed, and after a short ten years of golden development, it has fallen into the dilemma of slow development.
Time has passed, once represented the highest level of China's machine tool industry four major machine tool enterprises - Shenyang machine tools, Dalian machine tools, Kunming machine tools, Qinchuan machine tools, In November 2017 Dalian machine tool bankruptcy, May 2018 Kunming machine tool delisting, November 2019 Shenyang machine tool judicial reorganization, now only Qinchuan machine tool from the long-term haze out.
The reason why Qinchuan machine tools can be revived from the dead is all attributed to Fast. Since March last year, the Shaanxi Provincial State-owned Assets Supervision and Administration Commission of Qinchuan Machine Tool, the controlling shareholder of Qinchuan Machine Tool, has transferred its 15.94% equity to Fast, which has launched a series of "rescue actions" for Qinchuan Machine Tools, on the one hand, to achieve the purpose of shell protection, on the other hand, it is also more focused on the main business. (For details, see "Yan Jianbo's First Move to Save Qin Chuan": 429 Million Injected into the "Miniature Version of Fast"" and "Don't You Want to Earn 80 Million Yuan a Year?") "Cruel Man" Yan Jianbo "Qin Chuan" Shanghua Mountain")
1: Inject "Miniature Fast". In 2020, Qinchuan acquired 100% of the equity of Walker Gear held by the controlling shareholder Fast Group for 429 million yuan in cash, injecting high-quality assets and further extending the high-end manufacturing industry chain, greatly improving product competitiveness and corporate profitability.
2: Clear out the "make quick money" assets. In April this year, Qinchuan and Changan Huitong signed the Equity Transaction Contract, publicly transferring to them the 40% equity of Qinchuan Leasing and 60% of the equity of Qinchuan Factoring held by the company, with transaction prices of 275.56 million yuan and 46.2 million yuan respectively, and increasing the net profit attributable to the mother by 63.79 million yuan.
3: The controlling shareholder won 800 million yuan of fixed increase. On September 2, Qin Chuan released a report on the non-public issuance of shares, and the company's one-year-long lock price increase was officially concluded. The company's actual non-public issuance of 206 million A-shares, the issuance object is the controlling shareholder Fast Group, the issue price of 3.88 yuan per share, the total amount of funds raised is 799 million yuan.
It should be noted that in the process of private placement of listed companies, a very realistic problem is placed in front of Qinchuan Machine Tool. According to the relevant regulations, listed companies need to have a clear main business to carry out refinancing business. At this critical juncture, Changan Huitong invested in the acquisition of Qinchuan leasing and Qinchuan factoring equity held by Qinchuan, which can be described as "sending charcoal in the snow", which has contributed to Qinchuan's further focus on resources, developed core main business, and contributed to the transformation and upgrading of Shaanxi's high-end equipment manufacturing industry and high-quality development.
After the completion of this offering, fast holds the equity ratio of Qinchuan machine tool from 15.94% to 35.19%, and the proportion of Qinchuan machine tool equity held by Shaanxi Production and Investment, a consistent actor, is diluted from 14.59% to 11.25%. Both are controlled by the State-owned Assets Supervision and Administration Commission of Shaanxi Province, and the total shareholding ratio increased from 30.53% to 46.44%. Fast is still the controlling shareholder of Qinchuan Machine Tool, and the State-owned Assets Supervision and Administration Commission of Shaanxi Province is still the actual controller of Qinchuan Machine Tool.
A series of drastic rectifications carried out by Fast and Furious have achieved remarkable results. This also led the seller's agency to give Qin Chuan a "highly recommended rating". New Era Securities expects that the 14th Five-Year Plan business strategic planning: the company's revenue target for 2025 is 10 billion yuan, and the net profit attributable to the mother is currently 800 million yuan. According to the analysis of the trend of the machine tool industry and the outlook of the company's business reform, the company is optimistic about reaching 10 billion yuan of revenue and 800 million yuan of net profit attributable to the mother in 2025, giving 30 times the PE valuation in 2025 and a medium-term market value space of 24 billion yuan.
<h1 class="pgc-h-center-line" data-track="89" > 3-year lock-up period: Fast is by no means speculative</h1>
From our observation standpoint, after the new refinancing rules landed on February 14 last year, the A-share market set off a wave of private placement for a while. Shaanxi's listed companies are certainly no exception. Let's take a few examples:
1: In February this year, Baoti Co., Ltd. (600456) completed the non-public issuance of A-share shares, raising 2 billion yuan. Xinhua Asset Management, Sunshine Asset Management, China Huarong, Wells Fargo Fund, Changan Huitong, Baoji Huaxia Group actual controller Zhang Baoxiang and other 13 institutions (or individuals) participated.
2: On August 5, Xi'an Catering (000721) disclosed the fixed increase plan (second revision) showing that the number of shares to be issued by the company in the non-public offering is 74.86 million shares, not more than 30% of the total share capital of the listed company before the issuance, and 304 million yuan is raised for the long-established revitalization and expansion project and supplementary working capital.
After the refinancing was "loosened", the lock-up period was shortened from the original 36 months and 12 months to 18 months and 6 months respectively, which greatly increased the interest of investors. However, as a controlling shareholder, the lock-up period is still set at 36 months like Fast, which is still relatively rare in the capital market.
We believe that Fast's move highlights the determination and perseverance of catching up with Germany and Japan in high-end CNC machine tools. In addition, we also believe that judging from the series of measures to save Qin Chuan, Fast is by no means speculative.
There are probably two reasons for this:
1: The machine tool replacement cycle is generally 10 years, 2011 is the highest demand point, and 2021 ushers in the update replacement cycle. Under the trend of incremental substitution and stock renewal, the demand potential of China's machine tool industry is huge. Ten years of new cycles opened, Fast will not easily get off the car.
2: It can be seen from the meeting of the State-owned Assets Supervision and Administration Commission of the State Council that in addition to practicing internal skills and strengthening key core technology research, machine tool enterprises "shoulder the responsibility of the 'chain master' of the industrial chain, carry out special actions to supplement the chain and strengthen the chain, strengthen the coordination of upstream and downstream industries, and actively promote the development of small and medium-sized enterprises" was also highlighted. As the downstream of Qinchuan, Fast knows the importance of Qinchuan and the machine tool industry.
In addition, in the "Shaanxi Provincial People's Government General Office on further improving the level of industrial chain development of the implementation of the 23 key industrial chains", CNC machine tools ranked first, by the provincial deputy secretary Hu Henghua as the "chain chief". Related articles can be found in "Shaanxi Announces "Industrial Strong Foundation": 9 "Provincial Leaders" and "23 Chain Masters"".
We have also seen that in the face of the "pain points" of the industrial chain and the "blockages" of the innovation chain, Qinchuan unveiled the list of the first batch of CNC machine tool industry chains in Shaanxi Province, and successively signed strategic cooperation agreements with Yanchang Petroleum, Xi'an Jiaotong University, Shanghai Polytechnic, Jiangfeng Electronics, and Dongfeng Parts group to promote the integration of the upper, middle, and lower reaches of the industrial chain, joint research, collaborative innovation, and realize the integration of scientific and technological resources of "production, learning, research, and use" to solve the problems of industrial development.
So far, we believe that after QinChuan successfully protected the shell, "returning to the source, focusing on the main business", creating a machine tool industry chain and value chain with an international vision and global competitiveness, and striving to promote the localization of high-end equipment is the main direction of attack. With the high-quality management and strong support of Fast, Qin Chuan is embarking on a new journey from the "old third line" to the "innovation line".