Dongxing Securities Corporation Limited(601198)
About Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700)
Recommendation summary report on public issuance of convertible corporate bonds
Dongxing Securities Corporation Limited(601198) (hereinafter referred to as ” Dongxing Securities Corporation Limited(601198) “, “sponsor” or “the institution”) as the sponsor of Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) (hereinafter referred to as ” Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) “, “issuer” or “the company”) for the continuous supervision of the public issuance of convertible corporate bonds in 2019, in accordance with the measures for the administration of securities issuance and listing sponsor business In accordance with the requirements of relevant laws, regulations and normative documents such as the stock listing rules of Shenzhen Stock Exchange and the self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 13 – recommendation business, the continuous supervision period of the company is until December 31, 2021. As of December 31, 2021, the continuous supervision period of the sponsor on Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) public issuance of convertible corporate bonds has expired, and this sponsor summary report is issued in accordance with the requirements of relevant regulations and normative documents.
1、 Commitment of recommendation institution and recommendation representative
1. There are no false records, misleading statements or major omissions in the contents of the recommendation summary report, supporting documents and relevant materials, and the recommendation institution and the recommendation representative shall bear legal responsibility for its authenticity, accuracy and completeness.
2. This institution and myself voluntarily accept any inquiry and investigation conducted by China Securities Regulatory Commission (hereinafter referred to as “CSRC”) on matters related to the recommendation summary report.
3. This institution and myself voluntarily accept the regulatory measures taken by the CSRC in accordance with the relevant provisions of the measures for the administration of securities issuance and listing recommendation business.
2、 Basic information of the sponsor
Name of recommendation institution: Dongxing Securities Corporation Limited(601198)
Registered address: 12th and 15th floors, No. 5 Financial Street, Xicheng District, Beijing (Xinsheng building)
Legal representative: Wei Qinghua
Name of sponsor representative: Zou Xiaoping, Yang Zhi
Tel: 01066555196
3、 Basic information of listed companies
Company name Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700)
English Name: Changsha Daile New Material Technology Co., Ltd
Shenzhen stock exchange where the shares are listed
Securities abbreviation Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700)
Stock Code: Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700)
Date of establishment: April 8, 2009
Listing time: September 12, 2017
Registered address: No. 108, Huanlian Road, high tech Development Zone, Changsha County, Changsha City, Hunan Province
Legal representative: Duan Zhiming
Secretary of the board of directors Zhou Jiahua
Postal Code: 410205
Tel: 86-73189862900
Fax 86-73184115848
The type of securities issuance is public issuance of convertible corporate bonds
The securities were issued on April 17, 2019
The listing place of the securities is Shenzhen Stock Exchange
4、 Overview of this offering
Approved by the reply on approving Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) public issuance of convertible corporate bonds (zjxk [2018] No. 1731) issued by the CSRC, the company publicly issued 2.1 million convertible corporate bonds with a face value of 100 yuan each. The total amount of funds actually raised was 210 million yuan, after deducting the underwriting fee of 3.7 million yuan, The actually received subscription capital of convertible corporate bonds is RMB 20630000000. The availability of the above funds has been verified by Tianzhi International Certified Public Accountants (special general partnership) and a capital verification report (tzyz [2019] No. 17459) has been issued. The convertible corporate bonds issued this time have been listed on Shenzhen Stock Exchange on April 17, 2019.
5、 Overview of sponsor work
Dongxing Securities Corporation Limited(601198) completed the due diligence recommendation of Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) this public offering of convertible corporate bonds, and conducted follow-up continuous supervision. According to the relevant provisions of the measures for the administration of securities issuance and listing recommendation business
It is stipulated that the continuous supervision period of this recommendation is from April 17, 2018 to December 31, 2021, and the continuous supervision period expires on December 31, 2021.
At present, the continuous supervision period has expired, and Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) has disclosed the annual report of 2021 on April 12, 2022. Dongxing Securities Corporation Limited(601198) according to the relevant provisions of the measures for the administration of securities issuance and listing recommendation business, the recommendation work of Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) is summarized as follows:
1. Due diligence recommendation stage
In the stage of due diligence recommendation, the recommendation institution actively coordinates all intermediaries to participate in the work related to securities issuance and listing, conducts due diligence and prudent verification on the company in strict accordance with laws, administrative regulations and the provisions of the CSRC, organizes the preparation of application documents and issues recommendation documents; After submitting the recommendation documents, take the initiative to cooperate with the audit work of the CSRC and organize the issuer and other intermediaries to reply to the opinions of the CSRC; Conduct due diligence or verification on specific matters related to this securities issuance and listing in accordance with the requirements of the CSRC, and conduct professional communication with the CSRC; In accordance with the requirements of the Listing Rules of the stock exchange, submit the relevant documents required for recommending the listing of Dale convertible bonds to the stock exchange and report to the CSRC for the record.
2. Continuous supervision stage
During the continuous supervision, Dongxing Securities Corporation Limited(601198) carefully supervised Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) to fulfill the obligations related to the standardized operation and commitment of listed companies; Supervise Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) pay attention to the construction of the company’s internal control system and the operation of internal control; Supervise Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) fulfill the obligation of information disclosure and review the information disclosure documents; Supervise Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) compliant use and deposit of raised funds; Supervise Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) effectively implement and improve the system to ensure the fairness and compliance of related party transactions; Continue to pay attention to matters such as Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) providing guarantee for others; Train Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) in combination with actual needs; Regularly inspect Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) on site, and timely submit relevant documents such as continuous supervision on-site inspection report and annual follow-up report to Shenzhen Stock Exchange.
In the continuous supervision stage, Dongxing Securities Corporation Limited(601198) urged Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) to continuously improve the internal control standard system and supervised the company to rectify the problems found in time:
(1) Information disclosure
Existing problems:
① In January 2020, the company received 7678469 yuan of special funds for technological transformation fees transferred from the high tech Zone and 200340164 yuan of post stabilization subsidies, which were not disclosed.
② In November 2021, the company received an interest subsidy of 140000000 yuan for technological transformation loan from Changsha Bureau of industry and information technology, which was not disclosed.
take steps:
① After self inspection, the company made supplementary disclosure in time, and disclosed the announcement on receiving government subsidies on December 30, 2020.
② After self inspection, the company made supplementary disclosure in time, and disclosed the announcement on receiving government subsidies on January 17, 2022.
(2) Establishment and implementation of internal system of the company
Existing problems: in 2020, the internal audit department did not strictly implement the provisions on quarterly audit of the use of raised funds.
Measures taken: the internal audit department of the company audited the use of raised funds every quarter in strict accordance with the requirements, formed internal audit opinions and conclusions, and conducted supplementary review on the historical raised funds.
(3) “Three sessions” operation
Existing problems: the minutes of some meetings of the board of directors and the board of supervisors of the company in 2020 are incomplete or some of them have no time to sign off the meeting notice.
Measures taken: the company sorted out the documents of previous meetings and supplemented them accordingly, clarified the audit responsibilities and procedures of subsequent meetings, and strengthened process supervision to avoid similar situations in the future.
(4) Deposit and use of raised funds
Existing problems: in 2020, the company originally planned to raise funds in the form of a wholly-owned subsidiary, but the company did not handle the procedures for capital increase in time; At the same time, affected by changes in the industry and market, the company failed to complete the project construction on schedule.
Measures taken: the company moderately postponed the implementation progress of the project until June 30, 2021. At the same time, in order to improve the use efficiency of the raised funds and the convenience of implementation, the company decided to adjust the original implementation mode of capital increase to loan implementation.
During the performance of the recommendation duties, the recommendation institution has paid close attention to Changsha Dialine New Material Sci.&Tech.Co.Ltd(300700) the following major matters:
(I) performance fluctuation during continuous supervision period
1. Impact of the new deal of photovoltaic industry on the company’s current and future performance on May 31, 2018
Matters of concern: the notice on matters related to photovoltaic power generation in 2018 was issued on May 31, 2018. The policy has brought certain adjustments to the demand for new installed capacity in 2018 and has a short-term adverse impact on China’s photovoltaic related industry chain enterprises. The company is an upstream material provider in the industry, and its business is also impacted in the short term.
Countermeasures: the company adheres to R & D investment, develops its products in the direction of thin line, provincial line and high precision, and complies with the trend of cost reduction and efficiency increase in the industry; The company’s customers cover most of the world’s well-known photovoltaic and sapphire processing enterprises. The company continues to increase market development and go deep into customer product supporting services, so as to reduce the impact on business.
2. Influence of policy regulation of photovoltaic industry in 2019 and “covid-19 virus” epidemic in 2020 on the company’s current and future performance
Matters of concern: since 2019, affected by the macro-control of national photovoltaic industry policies and the gradual fierce market competition, the photovoltaic industry chain industry has been adjusted to varying degrees, and the cost has been continuously transmitted to the upstream industry. The price of the company’s silicon chip diamond line has decreased significantly compared with the previous period, resulting in the reduction of the company’s gross profit margin and affecting the company’s profitability. In that year, the company realized an operating revenue of 261644400 yuan, a year-on-year decrease of 20.71%; The net profit was -458322 million yuan, a year-on-year decrease of 234.76%.
Since February 2020, affected by the “covid-19 virus” epidemic, the company’s industry and upstream and downstream are generally under operated; If the follow-up company’s industrial chain fails to return to work and production in a timely and comprehensive manner, it will have an adverse impact on the company’s business development.
Countermeasures: the company strengthens technological progress and new product development, carries out research and development in combination with the needs and changes of downstream industries, and continues to reduce product production costs; Promote the application of diamond wire in magnetic materials, semiconductors, stones and other fields, and broaden the profit growth point of the company; Strengthen the R & D and reserve of new products, improve the market competitiveness of the company and enhance the profitability of the company’s products.
3. The market competition of silicon chip diamond line in photovoltaic industry in 2020 and the impact of “covid-19 virus” epidemic on the company’s performance in that year and in the future
Attention: since 2020, with the increasingly fierce competition of silicon chip diamond lines in the photovoltaic industry and the continuous transmission of the pressure of cost reduction in the industrial chain, coupled with the impact of the global covid-19 pneumonia epidemic, the industry’s demand for diamond lines has decreased to a certain extent in the first half of the year. During the reporting period, the price and sales volume of the company’s silicon chip diamond line declined, which had a certain negative impact on the company’s operating performance. In that year, the company realized an operating income of 242897 million yuan, a net profit of 1.538 million yuan, and a net profit of -9.166 million yuan deducted from non parent company. The above industry policy changes, market demand changes, industry competition and other influencing factors will continue to exist in the next few years. The company is still facing great profit pressure, and the sponsor will continue to pay attention.
Countermeasures: the company continues to invest in research and development, and continues to make products thin, provincial and efficient; Promote the application expansion of diamond line and broaden the profit growth point of the company; Improve management, reduce cost and increase efficiency; Adjust the technological scheme and technical transformation and upgrading of the raised investment project according to the market changes.
4. In 2021, Changsha phase II and Zhuzhou daleshang are in the final construction stage. The scale effect brought by the expansion of production and continuous R & D investment has not yet fully shown its impact on the company’s current and future performance
Matters of concern: in 2021, the company’s Changsha plant phase II and Zhuzhou Daile are in the final construction stage, and the scale effect brought by continuous R & D investment and production expansion has not yet fully appeared, which still has a certain negative impact on the company’s operating performance in 2021; In 2021, Zhuzhou Daile had obtained the qualification of high-tech enterprise, and its income tax rate was adjusted from 25% to 15%. After Zhuzhou Daile implemented the preferential tax rate of 15%, the recognized deferred income tax assets were re measured, so that the net profit attributable to the shareholders of the listed company in 2021 decreased accordingly; The company has accrued inventory depreciation reserves for some products and main raw materials that cannot be effectively handled in time due to changes in downstream customer demand. In order to cope with downstream changes, the company has carried out technical upgrading and transformation of some original production equipment, resulting in an increase in the provision for equipment impairment; In addition, affected by the changes in the customer market environment, some customers’ collection cycle is too long due to their own business reasons, and the provision for bad debt reserves of accounts receivable is increased, which also has a certain impact on the current performance.
Countermeasures: the company continues to strengthen R & D investment and enhance the market competitiveness of products. On the basis of rapid improvement of production capacity, the company increases the expansion of new businesses and new customers, improves the delivery capacity of signed orders, provides customers with high-quality and sufficient supply guarantee through stable large-scale supply capacity, and timely expands production according to the development trend of the industry; Consolidate operation and management and comprehensively improve operation efficiency; Strengthen internal training and external introduction, and continue to increase talent introduction and team construction; Differentiated management to promote the development and market application of new products.
(II) change of sponsor representative
As the company applied for the public issuance of convertible corporate bonds on the gem, the company hired Dongxing Securities Corporation Limited(601198) as the sponsor of convertible corporate bonds Dongxing Securities Corporation Limited(601198) since May 31, 2018
