Orinko Advanced Plastics Co.Ltd(688219)
Citic Securities Company Limited(600030)
About Orinko Advanced Plastics Co.Ltd(688219)
Issue convertible corporate bonds to unspecified objects
Implementation letter of feedback on issuance and registration
of
Reply Report
Sponsor (lead underwriter)
North block of excellence Times Square (phase II), No. 8, Zhongxin Third Road, Futian District, Shenzhen, Guangdong Province
China Securities Regulatory Commission and Shanghai Stock Exchange:
The implementation letter of feedback on issuance and registration issued by Shanghai Stock Exchange on December 29, 2021 (hereinafter referred to as the implementation letter of feedback) has been received. Citic Securities Company Limited(600030) (hereinafter referred to as “sponsor”) as a sponsor of Orinko Advanced Plastics Co.Ltd(688219) (hereinafter referred to as ” Orinko Advanced Plastics Co.Ltd(688219) “, “company” or “issuer”) issuing convertible corporate bonds to unspecified objects and listing on the science and innovation board, and Orinko Advanced Plastics Co.Ltd(688219) Beijing Zhonglun law firm (hereinafter referred to as the “issuer’s lawyer”) and Tianjian Certified Public Accountants (special general partnership) (hereinafter referred to as the “reporting accountant”) and other relevant parties have implemented the relevant issues one by one. Now the reply to the feedback implementation letter is as follows, please review.
explain:
1、 Unless otherwise specified, the abbreviations or terms in this reply have the same meanings as those in the prospectus.
2、 The font in this reply represents the following meanings:
The questions listed in the feedback implementation letter are in bold (not bold)
Answers to questions in arial (bold or not)
Revision and supplement to the reply to the feedback implementation letter (BOLD)
catalogue
Question 1: 4 question 2: Attachment 20: general opinions of the recommendation institution on the reply of the issuer twenty-two
The issuer will be initially listed in 2020, and this raised investment project is the same as the previous raised investment project. The issuer’s performance fell sharply the following year. The issuer is requested to add: (1) this raised investment project is the same as the previous raised investment project, explain the reasons for the refinancing of the same project, whether the investment composition of the funds raised in the previous and subsequent times can be distinguished, and whether there is repeated investment. (2) The current construction progress of the project and whether the construction progress meets the expectations. (3) Details of the changes in the business environment in 2021 and before listing; Explain the reasons and rationality of the sharp decline in performance in the latest period in combination with the changes in business composition, income and cost; Whether there is a risk of continuous decline in subsequent performance. (4) Combined with the decline of performance, explain whether there is a difference between the benefit calculation basis of the raised investment project and the initial launch, and whether the benefit calculation of the raised investment project is cautious.
The recommendation institution and accountant are invited to give verification opinions.
reply:
1、 Issuer description
(I) the current project invested by raising funds is the same as the previous project invested by raising funds. Explain the reasons for the refinancing of the same project, whether the investment composition of the two raised funds can be distinguished, and whether there is repeated investment
1. Reasons for refinancing the same project
(1) The small scale of pre raised funds leads to a large capital gap in the project, and the capital pressure of investing in the project with its own funds in the short term is large
The company made an initial public offering in November 2020 and was listed on the science and innovation board. In this offering, the company originally planned to raise 170 million yuan, and the actual raised capital was 327821400 yuan. In view of the fact that the amount of the funds actually raised in the previous time is much lower than the amount of the funds originally planned to be raised, after deliberation and approval at the 32nd meeting of the first board of directors of the company, the raised funds invested in the “300000 t / a high-performance composite material project” in the previous raised funds are adjusted to 229.48 million yuan, which is lower than the total investment of the project plan. Since the second half of 2020, the price of upstream bulk raw materials has risen rapidly, and the overall procurement cost of the modified plastic industry in which the company is located has increased significantly. In this case, the company is facing the pressure of large capital expenditure and working capital.
As the amount of the company’s last raised funds invested in the project is far less than the total investment of the project plan, there is still a large capital gap in the project construction; At the same time, affected by the rising price of raw materials, the company has great capital pressure to invest in the project with its own funds in the short term. Therefore, the company plans to raise funds through refinancing and continue to invest “300000 tons per year”
(2) All the previously raised funds have been used, and it is proposed to refinance and invest to ensure the construction and implementation of the project
The company’s “300000 t / a high-performance composite material project” has intensively carried out various construction work. As of December 21, 2021, all the funds raised in the previous time have been used up. The company’s “300000 t / a high-performance composite material project” is progressing smoothly and is promoting the project construction according to the established planning progress. However, due to the small scale of the previously raised funds, it failed to cover the construction investment amount required for the project. Therefore, in order to complete the construction of the raised investment project on schedule, release the relevant production capacity of the raised investment project as soon as possible and promote the improvement of the overall profitability of the company, the company plans to continue to invest the raised funds in the “300000 ton annual high-performance composite project” through this convertible bond issuance, so as to ensure the construction progress of the project and ensure the smooth implementation of the project.
2. Whether the investment composition of the two raised funds can be distinguished and whether there is repeated investment
(1) The investment direction of the raised funds has a clear investment plan
The investment planning of the funds raised this time and the funds raised in the previous time to the “300000 tons per year high-performance composite material project” is as follows:
Unit: 10000 yuan
The actual investment amount of the previously raised funds and the investment amount of the current raised funds calculated after the recheck of the item No. the total amount of the proposed investment
1. Construction investment 107124 23287 60000 83287
Construction cost 487.1
Installation cost 21669 25000 46669 1.2 2858
1.3 equipment purchase cost 50338 1396 35000 36396
1.4 other 3448 221 – 221 expenses of project construction
1.5 reserve fund 1583 —
2 initial working capital 11921 —
Total 119045 23287 60000 83287
Note: 1. The actual project amount invested in the previous raised funds is 232.87 million yuan, which is greater than the planned investment amount of 229.48 million yuan. The excess part is the interest and cash management income of temporarily idle raised funds; 2. The difference between the planned investment amount of the construction investment of the project and the total investment of the two raised funds will be made up by the issuer with its own funds.
As shown in the above table, the sum of the previous raised funds and the current raised funds invested in the “300000 ton / a high-performance composite project” is less than the total investment of each part of the project. As of December 21, 2021, all the funds raised in the previous time have been used up. The funds raised in this time will be used for subsequent construction and installation engineering costs and equipment purchase costs. The investment composition of the funds raised in the previous and subsequent times can be clearly distinguished, and there is no repeated investment.
(2) The company has established a perfect supervision and management system
The company has established and improved an effective fund-raising management system to distinguish and strictly manage the funds raised last time and this time. According to the established management system of raised funds, the company has made clear provisions on the storage, use, management and supervision of the special account of raised funds.
The company will strictly abide by the provisions of the raised funds management system, independently deposit the raised funds in the special account determined by the board of directors, and reasonably arrange the progress and amount of this part of funds on the basis of scientific calculation and reasonable scheduling. The company will use the raised funds in strict accordance with the investment plan of the raised funds promised in the issuance application documents. When investing in the project with raised funds, the relevant departments need to go through the approval procedures for the use of funds, clarify the relevant responsibilities of each control link, apply, approve and use the raised funds according to the project plan, and conduct internal assessment and inspection on the use. The company will use the raised funds in strict accordance with the disclosed purposes, and the regulatory bank will supervise and manage the use of the raised funds, and accept the supervision and management of the sponsor.
The company will use the raised funds in strict accordance with the current construction progress of the raised investment project and the subsequent construction and payment plan, and effectively distinguish the investment arrangement of the two raised funds according to the plan. The follow-up investment of the funds to be raised can be effectively distinguished through the above-mentioned planning arrangements and the sequence of capital investment.
To sum up, a clear investment plan has been formed for the use of the previously raised funds and the funds raised this time. There is a significant difference in the sequence of capital investment, and the relevant management, supervision and control measures are perfect. The use of the funds raised this time and the previous time can be effectively distinguished, and there is no case of re investment.
(II) current construction progress of the project and whether the construction progress meets the expectations
According to the plan, the construction period of the company’s “300000 t / a high-performance composite project” is 3 years, including preliminary preparations such as scheme and construction design, engineering construction, equipment purchase and installation, equipment commissioning and trial production, project acceptance and other later work. The project is divided into two phases. The construction period of phase I and phase II is 1.5 years. The main work schedule of the project is as follows:
Serial number content 2020 2021 2022 2023 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1. Preliminary work of the project △
2 preliminary scheme design and construction design △△
3. Phase I plant construction, equipment purchase, △△△
install
Serial number content 2020 2021 2022 2023 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
4. Staff recruitment and training △△
5 phase I equipment commissioning and trial production △△
6 phase II plant construction, equipment purchase, △△△
install
7. Staff recruitment and training
8 phase II equipment commissioning and trial production △△
9. Completion △
The construction of the project was carried out in the second half of 2020. As of the date of issuance of this reply, the “300000 t / a high-performance composite project” has completed the preliminary work, preliminary scheme design and construction design, phase I plant construction and installation, phase I equipment purchase and installation, job recruitment and training, etc. at present, the project is in the stage of equipment commissioning, It is planned to start trial production in January 2022. The actual progress of the project is basically consistent with the planning progress, and the construction progress is in line with expectations.
(III) specific changes in the business environment in 2021 and before listing; Explain the reasons and rationality of the sharp decline in performance in the latest period in combination with the changes in business composition, income and cost; Is there any risk of continuous decline in subsequent performance
1. Changes in 2021 and pre listing business environment
