Hong Kong-listed Taiwanese company Zhen Mingli (01868.HK) announced that the board of directors intends to issue Taiwan Depositary Receipts (TDR). The company's chief financial officer and research and development director Chen Wei said that the company plans to raise 50 million US dollars, of which 40 million US dollars for the issuance of new shares, 10 million for the chairman of the board Fan Banghong to transfer the old shares to forward TDR, fundraising is mainly used to build new Factory needs. The company's TDR has the fastest chance to board the stock before the end of the year.
Actively expanding the triangular street light order Chen Hao said that the company has completed the vertical integration of the upper, middle and lower reaches. Since the mainland will be the world's largest LED market, and the mainland implements the “Ten Cities and Ten Thousand Cities†program, the company will set up in Yangzhou, Jiangsu Province in mid-September. The factory has become the largest LED company in the region, and hopes to seize the LED street lamp orders in Jiangsu Province and the entire Yangtze River Delta region in the future.
Chen Wei said that at present, Zhen Mingli has a contract for 30,000 baht in Heshan City, Jiangmen City, Guangdong Province. The Yangzhou Municipal Government plans to sign a 35 million yuan (RMB, the same below) streetlight contract to the company. In September, it also won the Expo. The center has a lighting order of 23 million yuan. The reporter asked that the city of Chongqing mentioned that the LED street lights in the city are still in the tender. Zhen Mingli is one of the manufacturers who are seeking bidding. Chen Hao said that if Chongqing can get orders, it will not rule out that it will be new in Chongqing. The planned LED park is set up.
The issue price-to-earnings ratio is about 25~30 times. Chen Yu said that Zhen Mingli now has a production capacity of about 500 million LED bulbs. In order to improve competitiveness and productivity, and to ensure rapid growth in the next three years, it is decided to raise funds for strategic development. Since many Hong Kong Taiwanese businessmen have recently returned to Taiwan, and the chairman is a Taiwanese, they intend to use Taiwan's financing platform to occupy a place in the LED community in Taiwan. He also said that the price-earnings ratio of Zhen Mingli TDR should be 25-30 times.
Chen Wei said that after the completion of the chip factory at the end of 2008 and the expansion of the effects of five MOCVDs, the company has completed vertical integration. After mass production began in June this year, the chips and epitaxial wafers can meet their own needs and are exported, thus saving 40% of the chip procurement costs, the overall LED production supply chain costs are reduced by 10-15%.
In the first half of the year, Zhen Mingli's revenue and profit decreased by 20% and 60% respectively. Chen Hao expects revenue to drop by 10% in the second half of the year, but he estimates that this year's full-year results will be the same as last year, showing chips in the second half of the year. Under the cost savings, the recession in the first half of the year will be recovered. And despite the surge in fixed assets and depreciation expenses last year, he believes that gross margin will still improve this year.
Zhen Mingli is a manufacturer of decorative lights, focusing on R&D, design, manufacture and distribution of LED lighting products, LED lighting products and stage lighting products. The Group's production base is located in Heshan City, Guangdong Province, and it adopts a vertically integrated business model to provide retail users such as HomeDepot, Target and CanadianTire and commercial users including hotels, gambling architectural design companies, decorative lighting stores, commercial banks and distributors. 10,000 kinds of lighting products are sold in more than 80 countries around the world.
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