Ganzhou Yihao New Material Co., Ltd
Ganzhou Yihao New Materials Co., Ltd.
(No. 16, metallurgical Road, Zhanggong District, Ganzhou City, Jiangxi Province)
Application documents for IPO and listing on GEM
Reply report of the second round of audit inquiry letter
Sponsor (lead underwriter)
(16th to 26th floors of Guosen Securities Co.Ltd(002736) building, 1012 Hongling Middle Road, Luohu District, Shenzhen)
Shenzhen Stock Exchange:
We have received the second round of examination and inquiry letter on the application documents of Ganzhou Yihao new materials Co., Ltd. for initial public offering and listing on the gem (audit letter [2021] No. 011418) (hereinafter referred to as the "inquiry letter") issued by your exchange on December 29, 2021, Guosen Securities Co.Ltd(002736) as a sponsor or sponsor (lead underwriter), with the issuer The lawyer of the issuer and the reporting accountant carefully implemented the issues listed in the inquiry letter one by one.
The sponsor has checked the issuer's reply (including supplementary disclosure and explanation) in this reply material to confirm and ensure its authenticity, completeness and accuracy.
Unless otherwise specified, the abbreviations or terms in this reply report have the same meanings as those in the prospectus (declaration draft).
The questions listed in the inquiry letter are in bold (not bold)
Responses to the questions listed in the inquiry letter (not bold)
Amendments and supplements to the prospectus and the reply to the inquiry letter (BOLD)
Matters disclosed in the prospectus are in italics (not bold)
catalogue
Question 1 About gem positioning 4 question 2 About history 14 question 3 About sales model 21 question 4 About related parties 25 question 5 About core technical capabilities 36 question 6 About the selling price 43 question 7 About operating income 58 question 8 About customers 73 question 9 About cost 83 question 10 About gross margin 95 question 11 About inventory 107 question 12 About financial internal control 122 question 13 About capital flow one hundred and twenty-seven
Question 1 About gem positioning.
The issuer is requested to further quantify and analyze the innovation in technology, products and business model, including the specific embodiment of production process and technology innovation, independent research and development and achievement transformation, R & D investment in each year, the number of patents formed, products under research, new product accumulation or revenue and orders formed in customers, expected business performance in 2021 and the sustainability of performance growth, Fully demonstrate whether it meets the positioning of the gem and the relevant requirements of "three innovations and four innovations".
The sponsor is requested to check and express clear opinions.
reply:
1、 The issuer does not belong to the industry specified in the "negative list" in Article 4 of the Interim Provisions on application and recommendation for issuance and listing of gem enterprises of Shenzhen Stock Exchange (hereinafter referred to as the "Interim Provisions on recommendation")
The issuer is committed to becoming a leading enterprise in the field of electronic materials and implementing the vertical integration development strategy of PCB industry chain. As of the date of issuance of the reply report of this audit inquiry letter, the issuer has three types of businesses: electronic circuit copper foil, aluminum based copper clad laminate and PCB, specializing in the R & D, production and sales of electronic circuit copper foil and its downstream aluminum based copper clad laminate, PCB and other products.
Taking into account the characteristics of the issuer's industry, its own business model, core technologies and products and other factors, according to the national economic industry classification (GB / t47542017) and the 2017 national economic industry classification notes issued by the National Bureau of statistics, the issuer's main business belongs to "398 electronic components and electronic special materials manufacturing" and "3985 electronic special materials manufacturing" of "39 computer, communication and other electronic equipment manufacturing industry"; The PCB business of the company belongs to "3982 electronic circuit manufacturing" under "398 electronic components and special materials manufacturing"
According to the guidelines for Industry Classification of listed companies (revised in 2012) issued by the CSRC, the industry of the issuer belongs to the manufacturing industry of computer, communication and other electronic equipment (code C39).
To sum up, the issuer does not belong to the industry specified in Article 4 "negative list" of the Interim Provisions on recommendation.
2、 The issuer has the characteristics of growth and "three innovations and four innovations" as stipulated in Article 3 of the measures for the administration of registration of initial public offerings on GEM (for Trial Implementation) (hereinafter referred to as "the measures for the administration of registration") and Article 2 of the Interim Provisions on recommendation
(I) the issuer is a growing innovative and entrepreneurial enterprise
1. The industry of the issuer is supported and encouraged by the state
Electronic circuit copper foil, aluminum based copper clad laminate and PCB belong to the industries encouraged and supported by the state. The terminals are used in many fields such as consumer electronics, 5g communication, Internet of things, big data, cloud computing, artificial intelligence, new energy vehicles, industrial control and medical treatment, aerospace and so on. Relevant national departments have a series of encouragement and support policies for the above industries, providing a good institutional and policy environment for the healthy development of the issuer's industry. In 2017, the national development and Reform Commission launched the guidance catalogue of key products and services of strategic emerging industries (2016 Edition), in which electrolytic copper foil was included; The Guiding Catalogue for industrial structure adjustment (2019 Edition) lists high-performance copper foil materials, high-performance copper clad laminates and printed circuit boards as encouraged industries; The classification of strategic emerging industries (2018) lists "high density interconnection printed circuit board, special printed circuit board and flexible multilayer printed circuit board" as the core electronic industry in the guidance catalogue.
The issuer's own products and their application fields are the development direction supported by the national strategy. The regulatory system, laws and regulations and relevant policies of the issuer's industry are conducive to the operation and development of the issuer.
2. The issuer has broad market space
Electronic circuit copper foil is an important material for the manufacture of copper clad laminate and printed circuit board. The terminal is applied to all kinds of electronic equipment of new generation information technology, such as communication, consumer electronics, automotive electronics and so on. Under the positive influence of policy encouragement, technological progress and demand renewal, the new generation of information technology such as cloud computing, big data, Internet of things, mobile Internet and artificial intelligence has evolved rapidly, and the core technology systems such as hardware, software and services have accelerated the reconstruction, which is triggering a new round of changes in the electronic information industry. According to the statistics of prismark, the global PCB market will reach US $65.2 billion in 2020. It is predicted that the global PCB market will reach US $74 billion in 2021, with a year-on-year increase of 14%. By 2025, the global PCB market will reach US $86.3 billion.
HSBC Qianhai securities predicts that the average annual compound growth rate of China's PCB output value will be about 8% from 2020 to 2025. It is expected that by 2025, China's PCB output value will reach US $51.7 billion and its share in the global PCB market will reach 60%.
To sum up, PCB has broad downstream applications, large market space and good growth in the future, which has laid a market foundation for the sustained and stable development of the issuer.
3. The issuer has obvious competitive advantages
After more than ten years of continuous development, the issuer has relatively obvious competitive advantages, such as vertical integrated industrial chain advantage, customer resource advantage, flexible production advantage, technology R & D advantage, product advantage and so on. For details of relevant advantages, please refer to "4. Competitive advantages and disadvantages" in "II. Basic information of the issuer's industry" (IV) market competition "in" section VI business and technology "of the prospectus.
4. The issuer has strong business expansion ability and high performance growth
The issuer has a strong ability to expand its business. The issuer has been deeply engaged in the copper foil industry for more than ten years. After years of development, the issuer has won the trust of many well-known customers by relying on stable product supply, perfect product quality, perfect service system, and relying on stable product supply, perfect product quality, perfect service system to win the trust of many well-known customers, relying on steady product supply, perfect product quality, perfect service system to win the trust of many well-known customers, and established well-known enterprises in the industry with well-known enterprises such as Shengyi Technology Co.Ltd(600183) Shengyi Technology Co.Ltd(600183) Shengyi Technology Co.Ltd(600183) \ , after years stable cooperative relationship.
While expanding and strengthening the electronic circuit copper foil business, the company makes use of the advantages of self-produced electronic circuit copper foil to gradually extend to the downstream of the industrial chain. In 2017, the company's aluminum based copper clad laminate production line was put into operation. In the third quarter of 2021, the company's PCB project phase I began trial production. The company successfully expanded its products to aluminum based copper clad laminate and PCB. The company has mastered the core technology of electronic circuit copper foil, aluminum based copper clad laminate and PCB production, which can realize product series research and development, quickly match the development of downstream new products, and respond to the market demand of end customers. The aluminum base copper clad laminate of the company uses self-produced copper foil, and the PCB products of the company use self-produced copper foil and aluminum base copper clad laminate, which has the advantages of advanced technology, complete specifications, stable quality, timely delivery and low cost. The company has successively established cooperative relations with customers such as Bichen technology, Jinshun technology and Yisheng circuit. The product terminals are applied to brands such as Xiaomi, Hisense, Skyworth and TCL. The PCB business of the company has established cooperative relations with well-known enterprises such as Shenzhen Mtc Co.Ltd(002429) , Shenzhen Jufei Optoelectronics Co.Ltd(300303) , Anhui Coreach Technology Co.Ltd(002983) , Suzhou Dongshan Precision Manufacturing Co.Ltd(002384) , Longda electronics, TCL group, Shenzhen Refond Optoelectronics Co.Ltd(300241) , etc., and all of them have achieved mass supply, with good product quality and market feedback.
During the reporting period, the company's operating performance has good growth. In each period of the reporting period, the company's operating revenue was 7560569 million yuan, 8384734 million yuan and 12710499 million yuan respectively, with a compound growth rate of about 30% from 2019 to 2021. During the reporting period, the scale of the company's assets and net assets continued to expand, the net cash flow and financial status of operating activities were good, and the profitability continued to enhance, laying a good foundation for the company's future development.
5. Expected operating performance in 2021 and sustainability of performance growth
(1) Expected operating performance in 2021
Benefiting from the strong downstream demand and the growing number of orders, the issuer expects the operating performance in 2021 as follows:
Unit: 10000 yuan
Year on year change rate of the project from 2021 to 2020
Year on year change rate of the project from 2021 to 2020
Operating income 127104998384734 51.59%
Net profit attributable to owners of parent company 1628416576395 182.52%
Net profit attributable to 1537731, 557239 and 175.96% of the owners of the parent company after deducting non recurring profits and losses
(2) Sustainability of performance growth
The downstream PCB industry has large space and rapid demand growth, which promotes the growth of China's electronic circuit copper foil market demand, and the localization proportion of high-performance copper foil products has increased, so the market prospect of China's electronic circuit copper foil industry is good; Through continuous research and development, the issuer continuously optimizes the product structure, and the proportion of high-end copper foil products is expected to continue to increase. On the premise of no significant adverse changes in the upstream and downstream of the industry and market supply and demand, the issuer's electronic circuit copper foil processing fee and sales revenue are sustainable to a certain extent; The issuer's implementation of vertical integrated development of PCB industrial chain can avoid the cyclical risk of a single product and improve the stability of the issuer's profitability. The specific analysis is as follows:
① The prospect of supply and demand structure of copper foil for electronic circuit is good 1
The downstream industry of electronic circuit copper foil has wide application fields, large market space and continuous growth of downstream demand. According to the prediction of HSBC Qianhai securities, the average annual compound growth rate of China's PCB output value from 2020 to 2025 is about 8%; It is estimated that the annual incremental demand of China's electronic circuit copper foil industry from 2020 to 2025 will be about 39000 tons, and the total demand is expected to be 448400 tons, 484300 tons, 523000 tons and 564900 tons;
In recent years, the expansion projects of copper foil enterprises are more concentrated in the field of lithium battery copper foil, and they are more cautious about the expansion of electronic circuit copper foil. Affected by the expansion cycle of about 24 months, according to the expansion plan of copper foil industry companies, from 2021 to 2024, China's annual new production capacity is expected to be 14400 tons, 21900 tons, 30000 tons and 22500 tons respectively, and the total production capacity is expected to reach 349800 tons, 371700 tons 401700 tons and 424200 tons.
Therefore, the supply and demand structure of copper foil for electronic circuits has a good prospect.
② Optimize the product structure and increase the proportion of high-end products
At present, the issuer has achieved 12 μ M ultra thin copper foil and 105 for HDI board μ The mass production and sales of m-thick copper foil has the ability of localization substitution in the field of ultra-thin copper foil and thick copper foil, and its processing cost is high. With the expansion of market demand, the increase of localization proportion and the upgrading of issuer's process technology and product structure in the future, the proportion of high-end and high-performance products such as ultra-thin copper foil and thick copper foil is expected to continue to increase, driving up the overall processing fee. 1. The following prediction of the future market demand and supply of electronic circuit copper foil is calculated according to the growth of PCB industry and the expansion of industry production. If there are great changes in the downstream and the same industry in the future, the market demand and supply may be adjusted.
In addition, from 2019 to the first half of 2020, due to trade friction, covid-19 epidemic and other factors, the prosperity of electronic circuit copper foil industry is low. Under this background, the issuer's capacity utilization rate and production and marketing rate from 2018 to 2020
