Securities code: 300752 securities abbreviation: Shenzhen Longli Technology Co.Ltd(300752) Shenzhen Longli Technology Co.Ltd(300752)
Scheme for issuing shares to specific objects
Demonstration analysis report (Revised Version)
January 2002
Shenzhen Longli Technology Co.Ltd(300752) (hereinafter referred to as ” Shenzhen Longli Technology Co.Ltd(300752) ” or “company”) is a company listed on the gem of Shenzhen Stock Exchange. In order to meet the needs of the company’s business development, expand the company’s business scale and further enhance the company’s capital strength and profitability, in accordance with the company law of the people’s Republic of China (hereinafter referred to as the “company law”) and the securities law of the people’s Republic of China (hereinafter referred to as the “Securities Law”) According to the provisions of relevant laws, regulations and normative documents such as the measures for the administration of securities issuance and registration of companies listed on the gem (for Trial Implementation) (hereinafter referred to as the “measures for the administration of registration”), it is planned to raise no more than RMB 1002 million (inclusive) by issuing shares to specific objects, The raised funds will be used for the intelligent manufacturing base project of medium and large-size Mini LED display modules and the supplementary working capital project.
(unless otherwise specified in this demonstration and analysis report, relevant terms have the same meaning as in the plan for Shenzhen Longli Technology Co.Ltd(300752) issuance of shares to specific objects) I. background and purpose of this issuance to specific objects (I) background of this issuance to specific objects
1. The commercialization of mini LED backlight technology will accelerate in 2021
Since 2019, BOE, TCL, qunchuang and Youda have launched various mini LED application prototypes and put them into small-scale mass production, including 27-75 Size Mini LED backlight display screen, TV and E-sports laptop panel. Apple, Samsung and LGD are also actively participating in investing in mini LED production and manufacturing projects and accelerating the commercialization of Mini LED backlight technology, New products using mini LED backlight technology are constantly released. For example, Apple launched 32 inch Apple Pro XDR in 2019, the second generation iPad pro in 2021, Huawei launched 75 inch smart screen, Xiaomi launched Xiaomi master series TV, Samsung launched 49 inch curved surface E-sports display, and MICROSTAR launched 17 inch NB. From the perspective of industrial chain layout, mini LED has successfully met the conditions of technology, capacity and yield, and is about to enter the fast lane of development.
2. The implementation of relevant policy documents promotes the further development of the industry
The Chinese government attaches great importance to the development of LCD industry and has promulgated a series of laws, regulations and policy documents, which has established a good policy environment for the development of LCD industry and backlight display module industry. The 13th five year plan for the development of national strategic emerging industries issued by the State Council encourages collaborative innovation in the semiconductor display industry chain; The technology development roadmap of China’s optoelectronic device industry (2018-2022) issued by the Ministry of industry and information technology puts forward a series of guiding opinions for the optical display device industry; The action plan for the development of UHD video industry (2019-2022) issued by the Ministry of industry and information technology, the State Administration of radio and television and China Central Radio and television proposed to accelerate the innovation and application of 4K industry. At the same time, 8K technology reserves were made in combination with the development trend of UHD video technology and the law of industrial development, providing new opportunities for the development of new display technologies such as small spacing and mini / micro led, The national industrial policy support has laid a good policy foundation for the smooth implementation of the project.
In July 2021, under the organization of China electronic video industry association, the test method for mini led backlit LCD TV, technical requirements for mini led backlit LCD TV and purchase guide for mini led backlit TV, jointly formulated by TCL industry, Huawei, Skyworth, Hisense, Konka, TCL Huaxing, BOE, Samsung, Changhong, Xiaomi and oppo, were officially released, The release of various documents also further standardizes the mini LED industry and promotes the benign development of the mini LED backlight display industry.
3. Mini LED technology injects new vitality into the development of LCD industry and is conducive to enhancing China’s competitiveness in LCD industry
Since 2020, the concentration of global LCD panel production capacity has intensified and is fully concentrated in China. According to omdia’s prediction, in 2021, the LCD capacity area share of TCL Huaxing and BOE will reach 40% of the global capacity. According to DSCC, with the release of China’s panel production capacity and the closure of Korean manufacturers, the LCD capacity of China Chinese mainland will reach 70% in the four quarter of 2022. China has taken the leading position in the LCD industry.
With the continuous breakthrough of technology, the speed of product innovation is also accelerating. As an innovative application of backlight module, mini LED has higher stability and reliability than OLED, injects vitality into the diversity of LCD, promotes the innovation iteration of LCD technology, and further improves China’s overall competitiveness in LCD industry. (II) purpose of this issuance
The company plans to raise funds by issuing shares to specific objects. After deducting the issuance expenses, it plans to be used for the intelligent manufacturing base project of medium and large-size Mini LED display modules and supplement working capital. The project is conducive to further enhance the competitiveness of the company’s existing main business, consolidate the company’s first mover advantage in the field of mini led and accelerate the improvement of the company’s mass production capacity, In line with the company’s strategic development objectives.
As mentioned above, under the background of accelerating the commercialization of mini LED backlight technology, the landing of mini LED backlight policy documents and the gradual improvement of China’s voice in the LCD field, mini LED backlight technology has begun to enter the era of mass production. Since 2016, the company has invested a lot of money and manpower in the research and development of mini LED technology, studied and integrated IC drive, circuit design, structure, optics and flexible board packaging, and took the lead in developing a variety of products. The mini LED technology studied at this stage can be applied to vehicle, tablet, laptop, TV Display and intelligent wear. In 2020, the company continued to increase R & D investment, continuously improved its technical capacity, and made breakthroughs in new technologies. At present, the company basically has the corresponding technical reserve, and some products have achieved mass production, which has a leading advantage. The company has the resource reserve foundation of technology R & D, market, talents and so on.
After the intelligent manufacturing base project of medium and large-size Mini LED display modules is put into operation, it is conducive to further maintain and expand the company’s first mover advantage of mini LED technology, accelerate the improvement of mass production capacity, adjust the company’s business structure, broaden the application field, and cultivate new business growth points. At the same time, the project is also the company’s grasp of the industry development direction, Realizing the needs of the company’s product technology iteration is conducive to improving the technical content and added value of the company’s products and increasing the company’s profit margin.
2、 The necessity of selecting the securities issued this time and their varieties (I) the varieties of securities issued this time
The type of shares issued to specific objects this time is domestic listed RMB ordinary shares (A shares), with a par value of RMB 1.00 per share. (II) necessity of selection of securities issued this time
1. Meet the capital needs of the investment project with the raised funds
The investment amount of the project invested by the raised funds of the company is large, and the company’s own funds are difficult to meet the capital needs of project construction. The company hopes to obtain the necessary capital support through the issuance to specific objects, further enhance the company’s capital strength, optimize the asset liability structure, and improve the company’s profitability and anti risk ability, so as to maximize the shareholder value.
At the same time, compared with other financing methods, equity financing has the characteristics of long-term, which can avoid the repayment pressure caused by capital maturity mismatch, ensure the smooth development of investment projects, help the company implement long-term development strategy and maintain a stable capital structure.
2. There are limitations in corporate bank loan financing
The company’s financing amount through bank loans and other debt financing methods is relatively limited, and will produce high financing costs. If the investment project of the raised funds is fully financed by creditor’s rights, on the one hand, it will lead to the rise of the company’s asset liability ratio, affect the company’s stable financial structure and increase financial risks. On the other hand, higher financial expenses will reduce the overall profit level of the company and increase operational risks.
3. Issuing shares to specific objects is a financing method suitable for the company at this stage
Equity financing has good planning and coordination, is in line with the company’s long-term development strategy, can enable the company to maintain a relatively stable capital structure, better match the progress of investment projects and capital inflow, and avoid the repayment pressure caused by time mismatch. By issuing shares to specific objects to raise funds, the total assets and net assets of the company will increase accordingly, further enhance the capital strength and provide a strong guarantee for subsequent development.
Based on the above, it is necessary for the company to issue A-Shares to specific objects for financing. 3、 Appropriateness of the selection scope, quantity and standard of the issuing object (I) appropriateness of the selection scope of the issuing object
The objects of this issuance of shares to specific objects are no more than 35 (including) specific investors who meet the requirements of the CSRC, including securities investment fund management companies, securities companies, trust companies, finance companies, insurance institutional investors, qualified overseas institutional investors, and other legal persons who meet the requirements of the CSRC Natural persons or other qualified investors. Where securities investment fund management companies, securities companies, qualified foreign institutional investors and RMB qualified foreign institutional investors subscribe for more than two products under their management, they shall be regarded as one issuance object; As the issuing object, trust companies can only subscribe with their own funds.
The final issuance object shall be authorized by the general meeting of shareholders. After the issuance application is reviewed and approved by the Shenzhen Stock Exchange and the approval and registration decision is made by the CSRC, the board of directors shall negotiate with the sponsor (lead underwriter) according to the bidding results in accordance with the relevant provisions of the CSRC and the Shenzhen Stock Exchange. If national laws and regulations have new provisions on the issuing object of issuing shares to specific objects, the company will adjust according to the new provisions. All issuers subscribe for the shares issued this time in cash at the same price.
The selection scope of the issuing object complies with the relevant provisions of the registration management measures and other laws and regulations, and the selection scope of the issuing object is appropriate. (II) appropriateness of the number of objects to be issued
The final distribution object is no more than 35 specific objects in accordance with relevant laws and regulations.
The number of objects to be issued this time complies with the relevant provisions of laws and regulations such as the measures for the administration of registration, and the number of objects to be issued is appropriate. (III) appropriateness of standards for the objects of this issuance
The issuing object shall have certain risk identification ability and risk bearing ability, and have corresponding capital strength.
The standards of the objects of this issuance comply with the relevant provisions of laws and regulations such as the measures for the administration of registration, and the standards of the objects of this issuance are appropriate.
To sum up, the selection scope, quantity and standards of the issuing objects meet the requirements of relevant laws and regulations. 4、 Rationality of pricing principle, basis, method and procedure of this offering (I) pricing principle and basis of this offering
The pricing benchmark date of this issuance to specific objects is the first day of the issuance period of this issuance of shares to specific objects.
The issuing price of the shares to be issued to specific objects shall not be lower than 80% of the average trading price of the company’s shares 20 trading days before the pricing benchmark date. Average stock trading price in the 20 trading days before the first day of the issuance period = total stock trading volume in the 20 trading days before the first day of the issuance period / total stock trading volume in the 20 trading days before the first day of the issuance period. During the period from the pricing benchmark date to the issue date, if the company has ex rights and ex interests matters such as dividend distribution, bonus shares or conversion of share capital, the issue price will be adjusted accordingly. The adjustment formula is as follows:
Cash dividend distribution: P = p0-d
Bonus shares or converted into share capital: P = P0 / (1 + n)
Both at the same time: P = (p0-d) / (1 + n)
Where P0 is the issue price before adjustment, D is the cash dividend distributed per share, n is the number of bonus shares or converted share capital per share, and P is the issue reserve price after adjustment.
The final issue price of this offering to specific objects will be determined through negotiation between the board of directors and the sponsor (lead underwriter) in accordance with the provisions of relevant laws, regulations and documents and the subscription quotation of investors after the company’s application for this offering is reviewed and approved by Shenzhen Stock Exchange and the approval and registration decision is made by China Securities Regulatory Commission.
The pricing principle and basis of this offering are in line with the relevant provisions of laws and regulations such as the registration management measures, and the pricing principle and basis of this offering are reasonable. (II) pricing methods and procedures for this offering
The pricing methods and procedures for the issuance of shares to specific objects are in accordance with the relevant provisions of the registration management measures and other laws and regulations. The board of directors is convened and the relevant announcements are disclosed on the website of Shenzhen Stock Exchange and the media meeting the conditions specified by the CSRC, and it is proposed to submit them to the general meeting of shareholders of the company for deliberation, It needs to be examined and approved by Shenzhen Stock Exchange and approved by China Securities Regulatory Commission.
The pricing methods and procedures of this offering comply with the relevant provisions of laws and regulations such as the registration management measures, and the pricing methods and procedures of this offering are reasonable.
To sum up, the pricing principles, basis, methods and procedures of this offering comply with the requirements of relevant laws and regulations, and the compliance is reasonable. 5、 Feasibility of this issuance method (I) legality and compliance of the issuance method
1. This issuance meets the issuance conditions stipulated in the securities law
(1) This issuance complies with the relevant provisions of Article 9 of the Securities Law: the issuance of securities to specific objects shall not be made by means of advertising, public persuasion or disguised disclosure.
(2) This issuance complies with the relevant provisions of Article 12 of the Securities Law: when issuing new shares, a listed company shall meet the conditions specified by the securities regulatory authority under the State Council approved by the State Council. The specific management measures shall be formulated by the securities regulatory authority under the State Council.
2. The company does not have a registration form
