On April 7, Kechuang board will usher in a leading company in the field of automotive electronics.
Recently, Jingwei Hengrun (688326, SH) announced that the company would make an initial public offering and be listed on the science and innovation board. The number of shares to be issued this time is 30 million, accounting for 25% of the total share capital of the company after the issuance. Among them, the number of shares issued by the initial strategic placement is 6 million, accounting for 20% of the number of shares issued this time. The inquiry date is March 31, 2022, and the subscription date is April 7, 2022.
On April 6, Jingwei Hengrun conducted an IPO roadshow, and the issue price was determined to be 121.00 yuan / share.
Ji Yingcun, chairman and general manager of Beijing Jingwei Hengrun Technology Co., Ltd., believes that the competitive advantages of Jingwei Hengrun are mainly reflected in the advantages of “Trinity” collaborative development, intelligent driving full stack solutions, customer resources, long-term accumulated R & D ability and so on. Among them, the “Trinity” collaborative development advantage means that the company’s electronic products, R & D services and solutions, and high-level intelligent driving overall solution business form a “Trinity” business layout, which supports and cooperates with each other in terms of core technology, application scenarios, industry customer base and so on.
According to public data, Jingwei Hengrun (Beijing Jingwei Hengrun Technology Co., Ltd.) was established in 2003 with a registered capital of 90 million yuan, focusing on providing customers in the fields of automobile and unmanned transportation with electronic products, R & D services and overall solutions for high-level intelligent driving. Headquartered in Beijing, it has established modern production plants in Tianjin and Nantong, forming a perfect R & D, production, marketing and service system.
Among Jingwei Hengrun’s customers, there are many well-known enterprises such as FAW Group, Saic Motor Corporation Limited(600104) , BAIC group, Jiangling Motors Corporation Ltd(000550) , BorgWarner and so on. According to the financial report data, Jingwei Hengrun realized an operating revenue of about 3.262 billion yuan in 2021, a year-on-year increase of 31.61%.
Jingwei Hengrun is a leading automotive electronics company in China. Its business is growing rapidly. It is capable of domestic substitution and has participated in overseas competition. It has formed an industry-leading product development process and engineer training system. It is a R & D driven growth company. Not only that, the company’s intelligent driving and intelligent networking business is growing rapidly, the body electronic business can develop stably and rapidly, and the high-end equipment electronic business has great potential and profit margin.
main business increased steadily and profitability improved significantly
As a comprehensive electronic system technology service provider, Jingwei Hengrun’s main business revolves around electronic systems, and its electronic products, R & D services and solutions, and high-level intelligent driving overall solution business have formed a “Trinity” business layout, which can support each other in core technologies, application scenarios, industry customer groups and other aspects to achieve coordinated development.
Among them, its electronic products business mainly includes intelligent driving electronic products, such as (ADAS), intelligent driving domain controller (adcu), on-board high-performance computing platform (HPC), millimeter wave radar (radar), on-board camera (CAM), high-precision positioning module (LMU), driver monitoring system (DMS) and automatic parking assist system controller (APA), etc; Intelligent networking electronic products, such as remote communication controller (T-box) and gateway (GW); Body and comfort domain electronic products, such as anti pinch controller (APCU), passenger car body control system (BCM), intelligent cabin sensing system (SCSS), keyless entry and start system (peps), etc; Chassis control electronic products, such as electric power steering controller (EPS), electronic parking system (EPB), etc; New energy and power system electronic products, such as vehicle control unit (VCU), battery management system (BMS), etc; Development services for high-end equipment electronic products and automotive electronic products.
Thanks to the rapid development of China’s automotive electronics industry, the demand for automotive electronics products is very strong. In addition, Jingwei Hengrun has strong technical advantages and R & D strength in the field of automotive electronic products, and its products have been fully recognized by customers. In recent years, its main business income has been growing steadily. In particular, with the development of intelligence and networking in the automotive industry, relevant automotive electronic products are rapidly popularized in new automotive products. Jingwei Hengrun’s intelligent driving electronic products, intelligent networking electronic products and body and comfort area electronic products have a strong growth momentum.
According to the prospectus data, from 2018 to 2021, the revenue of Jingwei Hengrun increased steadily, reaching 1.539 billion yuan, 1.845 billion yuan, 2.479 billion yuan and 3.262 billion yuan respectively. Among them, the annual revenue in 2021 increased significantly by 31.61% compared with that in 2020. Meanwhile, in 2021, the company’s net profit attributable to the owners of the parent company reached 146 million yuan, a year-on-year increase of 98.37%, and its profitability was significantly enhanced; The net cash flow from operating activities was 310 million yuan, an increase of 264 million yuan over the same period in 2020. In the first quarter of 2022, Jingwei Hengrun expects the company’s operating revenue to be 660 million yuan ~ 720 million yuan.
From 2018 to the first half of 2021, the main business income of Jingwei Hengrun was 1.532 billion yuan, 1.842 billion yuan, 2.473 billion yuan and 1.37 billion yuan respectively. The revenue of the pillar electronic products business in the above reporting period was 912 million yuan, 1218 million yuan, 1.8 billion yuan and 1.242 billion yuan respectively, accounting for 59.49%, 66.10%, 72.80% and 90.65% of the main business revenue respectively.
It can be seen that the electronic products business has contributed a very considerable proportion of revenue to Jingwei Hengrun and achieved stable growth. Moreover, the proportion of high-level intelligent driving overall solutions under Jingwei Hengrun in the main revenue increased from 0.26% in 2018 to 1.57% in 2020, and the revenue in 2019 and 2020 increased by 103.72% and 376.70% respectively compared with the previous year, which is an important emerging business direction of the company in the future.
Behind the growth of main business income is the continuous improvement of product sales of Jingwei Hengrun. According to the prospectus, from 2018 to 2020, the sales volume of electronic products under Jingwei Hengrun increased from 7.3284 million units to 8.4689 million units, an increase of nearly 16%. At the same time, the average sales price of Jingwei Hengrun’s electronic products also increased from 119.34 yuan / set in 2018 to 208.95 yuan / set in the first half of 2021, an increase of 75%.
It is worth mentioning that in 2020, the average price of Jingwei Hengrun products increased more because the sales of intelligent driving electronic products with higher average price increased more. During the reporting period, among the categories of body and comfort area electronic products, intelligent driving electronic products and intelligent Internet connected electronic products with a high proportion of electronic product revenue, the contribution of products with relatively high product prices to revenue and sales increased, resulting in an increase in the average price of corresponding categories of products.
In terms of sub regions, more than 90% of Jingwei Hengrun’s main business income comes from the Chinese market, of which East China, Northeast China and North China are the top three regions with sales respectively. However, its overseas market revenue is also increasing year by year. From 2018 to the first half of 2021, the sales revenue of Jingwei Hengrun in overseas markets was 114 million yuan, 149 million yuan, 168 million yuan and 103 million yuan respectively.
product technology is rapidly updated and customer structure is constantly improved
In fact, after years of accumulation and development, Jingwei Hengrun has become one of the few enterprises in China that can realize the coverage of intelligent driving electronic products, R & D services and solutions, and high-level intelligent driving overall solutions. Through continuous innovation and rapid iteration of products and technologies, Jingwei Hengrun has accumulated a large number of high-quality customers.
It is reported that the customers of Jingwei Hengrun automobile factory directly supplied by Jingwei Hengrun include FAW Group, Sinotruk Jinan Truck Co.Ltd(000951) , Saic Motor Corporation Limited(600104) , Guangzhou Automobile Group Co.Ltd(601238) and other Chinese automobile factories, as well as foreign automobile factories such as general motors, navista and Duff trucks. In addition, the company supplies international Tier1 customers such as inefa, Antonin, hi-lex, borgwana and Eaton industries. The products are applied to well-known models of vehicle enterprises such as general motors, Ford group and Jaguar Land Rover. In addition, the company has also won customers in the field of high-end equipment such as COMAC and Crrc Corporation Limited(601766) and customers in the field of unmanned transportation such as Rizhao Port Co.Ltd(600017) .
With the development of intelligent Internet connected vehicles and new energy vehicles, the company has expanded its customers to Geely, Weilai automobile, Weima automobile, Xiaopeng automobile and other main engine plants, and the customer organization is also improving day by day.
According to the disclosure of the prospectus, from 2018 to January to June 2021, the sales amount of the company’s top five customers accounted for 42.62%, 50.48%, 52.56% and 57.45% of the current operating revenue respectively. Among them, in the first half of 2021, Jingwei Hengrun’s top five customers were FAW, Sinotruk Jinan Truck Co.Ltd(000951) , BAIC, SAIC and GAC respectively. The company’s sales to the above customers were 444 million yuan, 119 million yuan, 94 million yuan, 79 million yuan and 56 million yuan respectively.
It is worth mentioning that as of June 30, 2021, the company and its subsidiaries have obtained 1477 authorized patents, including 617 invention patents, accounting for 41.77% of all patents.
Through long-term independent technology research and development and industrial practice experience accumulation, the company has deeply integrated the technical achievements with the electronic system industry, continuously promoted the technology industrialization and commercialization, and formed electronic products such as advanced assisted driving system (ADAS), anti pinch controller (APCU), remote communication controller (T-box), commercial vehicle body control system (BES), vehicle electronic and electrical architecture consulting services A variety of R & D services and solutions such as vehicle electronic and electrical simulation test solutions, as well as high-level intelligent driving overall solution services represented by port Maas solutions, have been widely recognized by customers in industries outside China.
Behind the technological innovation is the great investment of Jingwei Hengrun in the field of R & D. According to the prospectus, from 2018 to 2020, the R & D expenditure of Jingwei Hengrun increased from 265 million yuan to 352 million yuan, an increase of nearly 33%. In the first quarter of 2022, the company’s R & D expenses are expected to be about 145 million ~ 165 million yuan, with a year-on-year increase of 63.07% ~ 85.56%. Moreover, in order to maintain the leading R & D and innovation strength and improve the company’s industrial technology status, the company continues to strengthen talent recruitment, introduction and training, and strengthen R & D investment in the fields of intelligent driving and intelligent Internet connection.
committed to becoming a world-class integrated electronic system technology service provider
With strong technical advantages and customer resource advantages, Jingwei Hengrun has drawn a blueprint for future development, and under the strategic guidance of “professional focus”, “technology leadership” and “platform development”, it continues to move towards the goal of “international first-class comprehensive electronic system technology service provider, intelligent networked vehicle full stack solution supplier and high-level intelligent driving Maas solution leader”.
It is reported that the fund-raising investment project will mainly focus on the company’s existing main business, adapt to the company’s existing production and operation scale and technical level, continuously increase R & D investment based on the existing core technology, and effectively help the company improve its independent innovation ability and core technical strength, so as to further expand the business scale and improve its technology R & D ability.
Specifically, the investment projects of the raised funds include the pre research of basic technologies and products, breaking through and mastering the key technologies of automotive electronic system related products, strengthening the demand for R & D technology reserves of the company’s new products and improving the company’s R & D capacity; Use the company’s core technology to carry out new product research and development, purchase advanced software and hardware equipment, introduce high-level talents, overcome the key technologies in the forefront of the industry, ensure the continuous iteration of the company’s technology and products, and iteratively upgrade innovative electronic products such as advanced assisted driving system (ADAS), anti pinch controller (APCU), remote communication controller (T-box), commercial vehicle body control system (BES), so as to improve the company’s independent innovation ability; Build the development and upgrading of the company’s information system and cloud platform, comprehensively improve the company’s digital ability, and improve the company’s comprehensive operation ability to promote scientific and technological innovation.
Focusing on the project, it mainly covers Jingwei Hengrun Nantong automobile electronics production base project, Jingwei Hengrun Tianjin R & D center construction project, Jingwei Hengrun digital capability improvement project, etc.
Jingwei Hengrun said that in order to achieve the strategic objectives, the company will start from three aspects, including adhering to independent research and development and improving the core competitiveness of technology and products; Give full play to the role of fund-raising and capital platform; Improve the level of corporate governance and strengthen the construction of talent team.
“In the face of rapid technological innovation in the automotive electronics field, the company will always adhere to the concept of independent R & D and innovation driven development, closely track the industrial change trend and the core needs of downstream customers, pre research new technologies, explore new breakthroughs, and develop more products and solutions with core competitiveness.” Jingwei Hengrun said in the prospectus.
