Stock abbreviation: Tongwei Co.Ltd(600438) Stock Code: 600438 Tongwei Co.Ltd(600438)
Public issuance of A-share convertible corporate bonds
Summary of prospectus
(registered address: No. 588, middle section of Tianfu Avenue, high tech Zone, Chengdu, China (Sichuan) pilot Free Trade Zone) sponsor (lead lead underwriter)
Co lead underwriter
February 2022
Statement
All directors, supervisors and senior managers of the company promise that there are no false, misleading statements or major omissions in the prospectus and its abstract, and guarantee the authenticity, accuracy and completeness of the information disclosed.
The person in charge of the company, the person in charge of accounting and the person in charge of the accounting organization (Accounting Supervisor) shall ensure that the financial and accounting reports in the prospectus and its abstract are true and complete.
Any decision made by the securities regulatory authority and other government departments on this issuance does not indicate that it makes a substantive judgment or guarantee on the value of the securities issued by the issuer or the income of the investors. Any statement to the contrary is a false statement.
According to the provisions of the securities law, after the securities are issued according to law, the issuer shall be responsible for the changes in the operation and income of the issuer, and the investors shall be responsible for the investment risks caused by the changes.
The purpose of the summary of this prospectus is only to provide the public with a brief information about this offering. Before making a subscription decision, investors should carefully read the full text of the prospectus and take it as the basis for investment decisions. The full text of the prospectus is also published on the company's designated information disclosure website, http://www.cn.info.com.cn.
Tips on major issues
The company specially reminds investors to pay attention to the following major matters or risk factors, and carefully read the relevant chapters of this prospectus. 1、 Notes on the compliance of convertible corporate bonds with the issuance conditions
In accordance with the securities law, the measures for the administration of securities issuance by listed companies and other relevant regulations, the company has carefully examined the qualifications and conditions for applying for public issuance of convertible corporate bonds and believes that the company meets all the qualifications and conditions for public issuance of convertible corporate bonds. 2、 On the credit rating of the convertible bonds issued by the company this time
The company hired zhongchengxin international to conduct credit rating for the convertible bonds issued this time. The credit rating of Tongwei Co.Ltd(600438) subject assessed by China integrity international is AA +, and the rating outlook is stable. This rating reflects the company's strong ability to repay debts, less affected by adverse economic environment and low risk of default; The debt credit rating of " Tongwei Co.Ltd(600438) public issuance of A-share convertible corporate bonds" is AA +, which reflects the strong security of this bond, less affected by the adverse economic environment and low default risk.
During the duration of this convertible bond, China integrity international will conduct tracking rating at least once a year. If the credit rating of the current convertible bond changes due to factors such as the company's external business environment, its own or rating standards, it will increase the risk of investors and have a certain impact on the interests of investors. 3、 The convertible bonds issued by the company this time are not guaranteed
According to Article 20 of the measures for the administration of securities issuance of listed companies, "a guarantee shall be provided for the public issuance of convertible corporate bonds, except for companies with audited net assets of no less than RMB 1.5 billion at the end of the most recent period". As of December 31, 2020, the audited net assets of the company were 31.544 billion yuan, no less than 1.5 billion yuan, which met the conditions of no guarantee. Therefore, the convertible bonds issued this time did not provide guarantee; The company's unaudited net assets amounted to 34.0 billion yuan as of January 2024. If there are events that seriously affect the company's operating performance and solvency during the duration of this convertible bond, this convertible bond may increase the risk due to the failure to provide guarantee.
4、 Dividend distribution policy and cash dividend ratio of the company (I) dividend distribution policy of the company
The current effective articles of association of the company stipulates the after tax profit distribution policy as follows:
"Article 154 the profit distribution policy of the company is:
(I) principles and forms of profit distribution
1. The company should establish the awareness of returning shareholders, pay attention to the reasonable return on investment to investors, and try its best to maintain the continuity and stability of profit distribution while taking into account the actual operation and sustainable development needs of the company.
2. The company may distribute profits in cash, stocks, a combination of cash and stocks, or other ways permitted by laws and regulations. Cash is preferred over stock. If the conditions for cash dividends are met, cash dividends shall be used for dividend distribution.
Under the condition that the capital stock scale and ownership structure are reasonable, and the capital stock expansion is synchronized with the performance growth, the company can adopt the stock method for profit distribution. When the company distributes profits in the form of shares, it shall give reasonable cash dividend returns to shareholders and maintain an appropriate share capital scale, and comprehensively consider the growth of the company, the dilution of net assets per share and other factors.
3. If a shareholder illegally occupies the company's funds, the company shall deduct the cash dividend distributed by the shareholder to repay the funds occupied.
(II) conditions for cash dividends
1. The distributable profit realized by the company in this year (i.e. the remaining after tax profit after the company makes up the loss and withdraws the accumulation fund) is positive, and the implementation of cash dividends will not affect the daily operation and subsequent development of the company;
2. The audit institution shall issue a standard unqualified audit report on the annual financial report of the company;
3. The company has no major investment plan or major cash expenditure (except for the projects raised funds). (III) proportion and time of profit distribution
In principle, the company distributes profits once every fiscal year, and the accumulated profits distributed by the company in cash in the last three years are not less than 30% of the average annual distributable profits realized in the last three years. If necessary, the company can also make interim dividends according to the profitability and capital arrangement.
Under the conditions of cash dividend, the board of directors of the company shall comprehensively consider the characteristics of the industry, development stage, its own business model, profitability and whether there are major capital expenditure arrangements, and put forward differentiated cash dividend policies:
1. If the development stage of the company is mature and there is no major capital expenditure arrangement, the proportion of cash dividends in the profit distribution shall reach 80% at least;
2. If the development stage of the company is mature and there are major capital expenditure arrangements, the proportion of cash dividends in the profit distribution shall at least reach 40%;
3. If the development stage of the company is in the growth period and there are major capital expenditure arrangements, the proportion of cash dividends in the profit distribution shall be at least 20%.
(IV) decision making procedure and mechanism of profit distribution
The company's profit distribution plan shall be proposed and formulated by the board of directors in combination with the company's operation, profitability, future development and other factors, and with full consideration of the company's capital needs and investors' return demands.
In this process, the company should communicate and exchange with investors, especially small and medium-sized investors, fully listen to the opinions and demands of investors, and respond to the concerns of investors in a timely manner.
Independent directors shall express clear independent opinions on the profit distribution plan. The plan can only be submitted to the general meeting of shareholders for deliberation after being reviewed and approved by the board of directors. Independent directors can solicit the opinions of minority shareholders, put forward dividend proposals and directly submit them to the board of directors for deliberation.
If the company is profitable in the current year and the board of directors has not made a profit distribution plan, the company shall disclose the reasons for not paying cash dividends and the purpose of retaining the funds not used for cash dividends in the company. Independent directors shall express independent opinions on this.
(V) profit distribution adjustment mechanism
If the company needs to adjust its profit distribution policy due to major changes in the external environment or the company's own operating conditions, it shall take the protection of shareholders' rights and interests as the starting point, and the adjusted profit distribution policy shall not violate the relevant provisions of the CSRC and the stock exchange, The proposal on adjusting the profit distribution policy shall be submitted to the general meeting of shareholders of the company for deliberation and approval in the form of special resolution after being deliberated by the board of directors of the company. " (II) profit distribution of the company in the last three years
The profit distribution of the company in 2018, 2019 and 2020 is as follows:
Unit: 10000 yuan
Proportion of cash dividends attributable to the owners of the parent company in the net profit attributable to the parent company and the net profit attributable to the owners of the company in the current period
2020 108487.31 360792.34 30.07%
2019 79754.12 263456.88 30.27%
2018 62117.96 201874.60 30.77%
The accumulated profits distributed by the company in cash in the last three years totaled 2503593900 yuan, accounting for 90.92% of the average annual distributable profits realized in the last three years. During the reporting period, the company's retained profits were mainly used for project construction and supplementary working capital. (III) use of undistributed profits
In order to maintain the sustainable development of the company, the undistributed profits accumulated over the years are mainly used for the expenses related to the main business and continue to be invested in the production and operation of the company, including fixed asset investment projects and supplementary working capital. (IV) profit distribution policy before the issuance
As of June 30, 2021, the undistributed profit of the company was 10792039300 yuan (consolidated statement). According to the resolution of the company's 2020 annual general meeting of shareholders, the increased shares of the company due to the conversion of convertible corporate bonds issued this time enjoy the same rights and interests as the original shares. All ordinary shareholders registered on the equity registration date of dividend distribution (including those formed by the conversion of convertible corporate bonds) participate in the current dividend distribution and enjoy the same rights and interests. 5、 Special risk tips
The company urges investors to carefully read the full text of "risk factors" in this prospectus and pay special attention to the following risks: (I) risks of the investment projects with raised funds
1. Risk that the project invested with raised funds cannot achieve the expected benefits
The raised funds of the company will mainly invest in the manufacturing and technological transformation projects of high-purity silicon and single crystal pull rod cutting business. Although based on the development status and technical development trend of the photovoltaic industry and the company's technical and cost advantages, the company has conducted careful and sufficient feasibility study and demonstration on the investment project with raised funds, and made sufficient preparations in terms of talent, technology, market and so on. However, since the feasibility analysis is based on the current market environment and other factors, the company is faced with many uncertain factors such as industrial policy changes, market environment changes, industry technology changes, customer demand changes and so on. If unexpected adverse factors occur after the completion and operation of the project or the company cannot effectively explore new markets, there will be certain product sales risks after the expansion of production capacity, resulting in the failure of the project invested with raised funds to achieve the expected benefits.
2. Risks that cannot be digested by the new production capacity after the project invested with raised funds is completed
After the project is completed, 100000 tons of high-purity crystalline silicon and 15gw single crystal pulling rod cutting capacity will be added every year, with a large scale of new capacity. The company has conducted sufficient market research and feasibility demonstration, but the digestion of new capacity needs to rely on the future competitiveness of the company's products, the company's sales expansion ability and the development of photovoltaic industry, which is uncertain. At the same time, the company has formulated a series of measures for the digestion of new production capacity, but if there are major adverse changes in market demand in the future, the company will face the risk of whether the new production can be fully digested, and then affect the realization of the income of the investment project with raised funds.
3. Risk of depreciation and amortization of new fixed assets of raised investment projects
The raised investment project includes part of the fixed asset investment. It is expected that after the project is completed, the company will add 774775000 yuan of depreciation and amortization every year. The company expects the economic benefits of the raised investment project to be good, but the realization of the economic benefits of the raised investment project will take some time. If there are major adverse changes in the market environment and industrial policies during the implementation of the project, and the benefits of the raised investment project are less than expected, there may be a risk that the company's operating performance will be affected due to the significant increase of asset depreciation and amortization.
4. Risks of land implementation of investment projects with raised funds
In the project invested by the raised funds of the company, part of the land for the 15gw single crystal pull rod cutting project is performing the corresponding land transfer procedures, and the land certificate has not been obtained. According to the interviews with relevant competent authorities, corresponding investment agreements, land compliance review opinions, etc., the risk that the above land cannot be obtained is very low. Even so, the company is still unable to completely avoid the long relevant land transfer procedures, which makes the company face certain risks in the implementation of land investment projects with raised funds. (II) risks related to this convertible bond
1. Default risk
The duration of the convertible bonds issued this time is 6 years, the interest is paid once a year, and the principal and the interest of the last year are repaid at one time after maturity. If there are events that have a significant negative impact on the company's operation and management and solvency during the duration of the convertible bonds, it may affect the payment of bond interest and principal.
2. Risk of failure to provide guarantee
The company's issuance of convertible bonds meets the conditions without guarantee according to relevant regulations, so no guarantee measures are provided. If there are events that have a significant negative impact on the company's operation and management and solvency during the existence of convertible bonds, the convertible bonds may increase the risk due to the failure to provide guarantee.
3. Risk of price fluctuation of convertible bonds
Convertible bond is a kind of hybrid securities with bond characteristics and stock options. The secondary market price is affected by many factors, such as market interest rate, remaining maturity of bonds, conversion price, company stock price, redemption clause, resale clause and downward correction clause, investor expectation and so on
