Suzhou Dongshan Precision Manufacturing Co.Ltd(002384)
Yancheng Weixin Electronics Co., Ltd. new energy flexible circuit board and its assembly project
Feasibility analysis report
In order to further enhance the comprehensive strength of Suzhou Dongshan Precision Manufacturing Co.Ltd(002384) (hereinafter referred to as " Suzhou Dongshan Precision Manufacturing Co.Ltd(002384) " or "the company"), grasp the market development opportunities and realize the sustainable development of the company, the company plans to implement the new energy flexible circuit board and its assembly project of Yancheng Weixin Electronics Co., Ltd. (hereinafter referred to as "the investment project" or "the project"). The feasibility analysis of the project is as follows: I. overview of the investment project
1. Project Name: new energy flexible circuit board and its assembly project of Yancheng Weixin Electronics Co., Ltd
2. Estimated total investment: 650.234 million yuan
3. Project implementation subject: Yancheng Weixin Electronics Co., Ltd
4. Project address: No. 999, Yandu Road, Yandu District, Yancheng City, Jiangsu Province
5. Project construction period: 30 months
2、 Basic information of this investment project
(I) overall planning and construction objectives of the project
The construction of the project is based on the existing production process and business foundation of Yancheng Weixin Electronics Co., Ltd., a wholly-owned subsidiary of the company. The existing plant of the company is used for equipment investment, and the capacity formed is mainly for new energy vehicle customers.
The project will form an annual production capacity of 2.1 million square meters of vehicle mounted FPC through the purchase of automatic production lines such as RTR scanning exposure machine, RTR fast press, mounter and reflux furnace, so as to further consolidate the stable cooperative relationship between the company and well-known vehicle and parts manufacturers at home and abroad, improve the company's technical capacity and industrial scale, and provide better services for downstream customers, Enhance customer stickiness, grasp market opportunities and enhance market competitiveness.
(II) project investment calculation
The total investment of the project is 650.234 million yuan, and the investment amount of the raised funds is 615654700 yuan. The remaining funds are raised by the company itself. The specific investment plan is shown in the table below:
Unit: 10000 yuan
Investment of raised funds proportion of total investment amount of projects invested by raised funds
Proportion of amount
Equipment investment 48505.79 74.60% 48505.79 78.79%
Initial working capital 16517.61 25.40% 13059.68 21.21%
Total investment amount 65023.40 100.00% 61565.47 100.00%
(III) economic benefit analysis
The project starts from construction and is expected to generate benefits in the second year. The output will reach 18% in the second year, 50% in the third year and 100% in the fourth year. After the project is fully completed, the estimated annual operating income is 204.27 million yuan, the annual net profit is 171.6621 million yuan, the internal rate of return (after income tax) of the project is 22.92%, and the investment payback period (after income tax) is 6.91 years.
(IV) information of the project related to the items submitted for approval
The project has been filed in Yandu District administrative examination and approval Bureau of Yancheng City in January 2022 (filing project certificate No.: Duxing Shentou Bei [2022] No. 23), and the relevant EIA approval procedures are being actively promoted. 3、 Necessity and feasibility of the implementation of this investment project
(I) necessity of implementation of this investment project
1. In the context of accelerating the realization of the "double carbon" goal, the new energy vehicle and energy storage industry will usher in broad development space
In recent years, global ecological and environmental problems have become increasingly prominent, and global warming and other problems need to be solved urgently. Governments all over the world have proposed to accelerate the transformation to clean energy. China has put forward the goal of peaking carbon emissions by 2030 and achieving carbon neutrality by 2060; The EU has issued new energy development measures such as the European climate act, requiring member states to reduce greenhouse gas emissions by at least 55% in 2030 compared with 1990, and achieve EU wide carbon neutrality in 2050; The new U.S. government announced its return to the Paris Agreement, set the goal of zero emission vehicle sales accounting for 50% of the total new vehicle sales in 2030, and promised to achieve carbon neutrality by 2050.
As an important field of carbon emission reduction, the transformation of transportation industry, power generation industry and industrial production to new energy is the general trend. In the transportation industry, emission reduction will mainly rely on the improvement of electrification rate of vehicles and other means of transportation. In the power generation industry, the proportion of photovoltaic, wind power and other new energy power generation will increase rapidly, and energy storage, as its important supporting facilities, will also usher in rapid growth. Energy storage technology with low cost, long life, high safety and high energy density will be the development goal of the energy storage industry. In the field of industrial production, at present, it mainly depends on coal, oil and natural gas for energy supply. In order to achieve carbon emission reduction, the application scenarios of electrification in industrial production will continue to increase. With the increasingly clear development trend of clean energy in the whole society, the new energy vehicle and energy storage industry will usher in broad development space.
2. The new energy vehicle industry has ushered in unprecedented development opportunities, and the global power battery industry is about to enter the "TWH" era
At present, a new round of global scientific and technological revolution and industrial reform are booming. The integration of automobile and energy, transportation, information and communication and other fields has accelerated, and profound changes have taken place in the form of automobile products, transportation mode, energy consumption structure and social operation mode. The new energy vehicle industry is facing unprecedented development opportunities.
According to GGII data, the global sales volume of new energy vehicles in 2020 was 3.198 million, the average annual compound growth rate from 2015 to 2020 was 34.5%, and the global vehicle electrification penetration rate also increased from 0.8% in 2015 to 4.1% in 2020. In recent years, the development of Shanxi Guoxin Energy Corporation Limited(600617) vehicle industry has made remarkable achievements, and the scale of new energy vehicle production and marketing market has ranked first in the world for many years. According to the data of China Automobile Association, in 2020, the sales volume of Shanxi Guoxin Energy Corporation Limited(600617) vehicles was 1.367 million, with a year-on-year increase of 13.4%; From January to June 2021, the sales volume of new energy vehicles was 1.206 million, with a year-on-year increase of 207.0%, and the penetration rate of new energy vehicles reached 9.4%.
The growth of new energy vehicle industry has effectively driven the rapid development of power battery industry. According to GGII data, the global power battery shipment in 2020 was 186gwh, with a year-on-year increase of 45.3%; From January to June 2021, the global power battery shipment was 145gwh, with a year-on-year increase of 163.6%. The trend of new energy vehicles replacing fuel vehicles is becoming more and more obvious. With the significant growth of global penetration of new energy vehicles, power battery shipments will enter the "TWH" era in the next few years. The concentration of the battery industry has increased rapidly and the power of the battery industry has been further improved.
3. The deepening of automotive electronization promotes the growth of FPC market demand
Power battery, electric drive and electronic control systems are the core components of new energy vehicles, and the proportion of automobile electronic cost in the value of the whole vehicle continues to increase. Especially with the commercial application of 5g technology, the trend of automobile networking is significant. Intellectualization, electrification and networking will deepen the degree of automobile electronization. With the development of electric and intelligent vehicles, the advantages of FPC in bending, weight reduction and high degree of automation are further reflected. The consumption of FPC in the field of vehicle is increasing, and its applications cover power batteries, lamps, central control display, BMS / VCU / MCU and other control systems, automatic driving assistance systems and other related fields. According to the data of Zheshang Securities Co.Ltd(601878) Research Report in September 2021, it is estimated that the global and medium Shanxi Guoxin Energy Corporation Limited(600617) automobile FPC market space is expected to reach 14-24 billion yuan and 7.2-12 billion yuan respectively in 2030.
4. The trend of power battery FPC replacing copper wire harness is clear
The acquisition line is an important component required by the BMS system of new energy vehicles. It realizes the functions of monitoring the voltage and temperature of new energy power battery cells, connecting data acquisition and transmission, with its own overcurrent protection function, protecting the battery cells of vehicle power batteries, automatic disconnection in case of abnormal short circuit, etc.
Previously, the power battery collection line of new energy vehicles adopted the traditional copper wire harness scheme. The conventional wire harness is made of plastic surrounded by copper wire. When connecting the battery pack, each wire harness reaches an electrode. When there are many current signals in the power battery pack, many wire harnesses are required to cooperate, resulting in large space occupation. In the pack assembly process, the traditional harness relies on workers to fix the port on the battery pack manually, with a low degree of automation. In addition, in terms of current technology, the capacity of the battery is basically at the limit, and the size of the battery pack is almost fixed. Therefore, there are restrictions on how many batteries the battery pack can hold, and how to maximize the use of space is also the key research direction.
Compared with copper wire harness, FPC has outstanding advantages in safety, lightweight and regular layout due to its high integration, ultra-thin thickness and ultra flexibility. In addition, FPC has thin thickness and customized battery pack structure. It can be grabbed and placed directly on the battery pack by mechanical arm during assembly. It has a high degree of automation and is suitable for large-scale mass production, The trend of FPC replacing copper wire harness is clear. In the long run, sensing, control and other chips and signal sampling lines can be integrated into FPC, which can save space and maximize product stability, so as to further promote the development of vehicle FPC market.
(II) feasibility of this investment project
1. The company's high-quality customer resources provide a basic guarantee for the implementation of the project
Relying on the industry-leading technical strength, advanced production and manufacturing capacity and mature global sales and service system, the company has won the favor of many downstream customers and accumulated rich high-quality customer resources. In the field of automotive battery soft panel, the company has established a good cooperative relationship with well-known new energy vehicle manufacturers in North America. The customer platform has significant advantages, which helps the company maintain a good income level and continuously expand the scope of cooperation. Secondly, the high-quality customer platform can produce a good demonstration effect, further enhance the company's popularity, further improve the company's new customer development ability, and help the company obtain greater market share in the future competition.
2. Outstanding technological R & D and innovation strength provide strong technical support for project implementation
In the field of FPC, the company is one of the top three FPC manufacturers in the world. Mflex, a subsidiary of the company, is a leading enterprise in relevant industries. It has been deeply engaged in the FPC Industry for many years and has decades of industry development experience. It has established a global R & D team with outstanding professional level, rich industry experience and strong innovation ability, and has formed outstanding technical strength in the FPC field, It can provide reliable technical support for the smooth implementation of the project.
3. Strict production and manufacturing management to provide quality assurance for project products
The company continuously optimizes the production process, actively strengthens the quality management of the company's products, emphasizes the business philosophy of zero defects in the production and operation process, establishes a good quality control system, and standardizes the process and system, so as to ensure the quality of the company's products. The company has established a set of project management procedures and regulations in line with its own characteristics. Through the industry-leading information production and operation management and monitoring system independently developed, the company can monitor the whole production and operation process in real time, so as to optimize the product yield, improve the capacity utilization, ensure the order delivery time, and ensure that the product and service quality meet the specifications and standards and customer requirements. The company's excellent manufacturing capacity provides quality assurance for the project products.
4. The company's management team is experienced
Adhering to the business philosophy of "continuously creating value for customers, employees and shareholders with excellent technology", the company advocates the enterprise spirit of "openness, inclusiveness and pragmatism", adheres to the management principle of "decentralization of business, platform support and centralized supervision", gives full play to the subjective initiative and creativity of grass-roots organizations, and establishes a scientific and effective professional and group management system. The members of the company's management team have decades of rich practical experience in advanced manufacturing management and broad international vision, accurate strategic prediction and decision-making courage for industry trends and development opportunities, strong team cohesion, internationalization and collectivization experience and outstanding management ability, which has laid a solid management foundation for the implementation of the project. 4、 Risk analysis and Countermeasures
(I) risk of decline in customer demand
The development of the new energy vehicle industry has attracted a large number of enterprises to enter. If the future market demand changes or competition intensifies, resulting in adverse competition or even failure of the company's downstream customers, the company will face the risk of decline in customer demand.
The company will strengthen R & D investment, actively optimize product structure and continue to develop new customers outside China. At the same time, it will pay close attention to market trends and customer needs, so as to reduce the impact of the decline of customer demand on the company's performance.
(II) management risks caused by scale expansion
With the further expansion of business scale, higher requirements are put forward for the management ability of the company in production and operation, human resources, law, finance and standardization. If the management ability of the company cannot meet the needs of scale expansion and management ability improvement in the future, it will have an adverse impact on the sustainable development of the company.
The company will continue to improve relevant internal control systems, actively strengthen talent reserve and team building, and improve management ability, so as to deal with the management risks brought by scale expansion. 5、 Conclusion
After careful analysis, the board of Directors believes that the investment project is in line with the national industrial policy and industry development direction, which is conducive to promoting the sustained and stable growth of the main business and improving the profitability of the company.
