On January 3, Sichuan Furong Technology Co.Ltd(603327) (603327) announced that the company plans to sign the framework investment agreement with the people’s Government of Luoyuan county and the Management Committee of Fuzhou Taiwan investment zone to build a high-precision electronic consumption and high-end manufacturing base of new materials in Luoyuan County, Fuzhou City, Fujian Province. It is planned to purchase 941 mu of land at one time and build it by stages. The total investment is 5 billion yuan.
According to the announcement, the construction contents of the project include the “250000 tons of recycled aluminum and round ingot project” to be invested by the renewable resources company, the “80000 tons of consumer electronics aluminum profiles and deep processing project” to be invested by the high-end manufacturing company, and the “100000 tons of aluminum alloy new materials and deep processing series projects”. The overall construction time of the project is expected to start in 2022, which is divided into three phases, and the construction cycle is expected to be six years.
Among them, the first phase of the project is the “100000 t / a recycled aluminum and round ingot project” (the project investment is expected to be RMB 323 million) to be invested and constructed by the renewable resources company and the “60000 T / a consumer electronics aluminum profile and deep processing project” (the project investment is expected to be RMB 896 million). The first phase of the project investment is expected to be RMB 1.218 billion, The funds mainly come from self owned funds and corporate financing.
Specifically, Sichuan Furong Technology Co.Ltd(603327) plans to set up wholly-owned subsidiaries Fujian furongyuan renewable resources development Co., Ltd. (hereinafter referred to as “renewable resources company”) and Fujian furongyuan new material high-end manufacturing Co., Ltd. (hereinafter referred to as “high-end manufacturing company”) in Luoyuan County, with the two companies as the main body of project implementation. Renewable resources company mainly provides high-end manufacturing companies with round ingots of raw materials for production.
Among them, the annual output of 250000 tons of recycled aluminum and round ingot project of renewable resources company is planned to be located in the West plot of high-end wall and floor tiles in Jingang Industrial Park (covering an area of about 239 mu), with an output value of about 5 billion yuan / year. The high-end manufacturing company has an annual output of 80000 tons of electronic consumer aluminum profiles, with an output value of about 2.5 billion yuan / year; New materials and intensive processing projects with an annual output of 100000 tons, with an output value of about 9 billion yuan / year. The above projects are planned to land on the thumb plot in area B of Taiwan investment zone (with an area of about 702 mu). The total output value above is about 16.5 billion yuan / year.
Sichuan Furong Technology Co.Ltd(603327) pointed out that the foreign investment project will help to expand the scale of production capacity and improve the share of the company’s products. In the future, with the gradual improvement of the epidemic situation, the gradual recovery of the economy, the increasing maturity of 5g technology, the improvement of supporting facilities and the large screen and foldable application of smart phones, the development prospect of smart phones is still promising, and it is expected that the shipment of smart phones will reach a climax again. At the same time, with the continuous improvement of the performance of tablet computers and notebook computers, their application range will be wider and wider. More and more tablet computers are involved in the fields of office, education and so on. With the stimulation of equipment demand brought by stock equipment replacement and innovation, tablet computers and notebook computers still have considerable market development space, thus driving the demand for aluminum structural parts.
Secondly, industries related to AR, VR, 3D and other technologies have just sprung up and have broad market prospects in the future, which will bring new and huge growth space to the application of aluminum and other new materials. Sichuan Furong Technology Co.Ltd(603327) believes that after the investment project is fully completed, the company will increase the production capacity of consumer electronics aluminum, which will help the company solve the problem of insufficient production capacity in peak season, further improve the market share of products and maintain the company’s leading market position.
In addition, Sichuan Furong Technology Co.Ltd(603327) also said that the project is located in Luoyuan County, Fuzhou City, Fujian Province, close to the “Pearl River Delta” and “Yangtze River Delta” where the end customers of consumer electronic aluminum profiles gather, which can significantly reduce the transportation cost; Close to end customers to facilitate communication with customers and order acceptance. At the same time, most of the new aluminum material application enterprises are in coastal cities. The project takes root in coastal cities in advance, which will help the company expand the aluminum application field in the future and effectively interact with potential customers, so as to form regional advantages and help the company solve the problem of single product and industry.
However, Sichuan Furong Technology Co.Ltd(603327) also prompted the risk that the total amount of funds involved in this foreign investment is large, which is much higher than the current book monetary capital level of the company. The investment amount mainly comes from the company’s own funds and the company’s financing. Although the company’s current asset liability ratio is relatively low and has strong financing capacity, due to the influence of policy factors, financial market and other external environment, if the funds cannot be raised in time, there may be risks of change, extension, suspension or termination in the subsequent agreement performance and project implementation. According to the data of the third quarterly report, by the end of the third quarter of 2021, Sichuan Furong Technology Co.Ltd(603327) Book monetary capital was only 99.1501 million yuan.
(Securities Times · e company)
