Securities code: 300343 securities abbreviation: Lecron Industrial Development Group Co.Ltd(300343) Announcement No.: 2022-011 Lecron Industrial Development Group Co.Ltd(300343)
Supplementary announcement
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
1、 Overview of foreign investment
Lecron Industrial Development Group Co.Ltd(300343) (hereinafter referred to as “the company”) disclosed the announcement on foreign investment (Announcement No. 2022-009) on January 21, 2022, The company plans to jointly invest with Jiangxi Black Cat Carbon Black Inc.Ltd(002068) (hereinafter referred to as ” Jiangxi Black Cat Carbon Black Inc.Ltd(002068) “) to establish “Inner Mongolia Lianhe fluorocarbon New Material Co., Ltd. (tentative name, specific name shall be subject to the name approved and registered by the market supervision and administration department) (hereinafter referred to as” Inner Mongolia Lianhe “or” joint venture “). The registered capital of Inner Mongolia Lianhe is proposed to be 500 million yuan, of which: the subscribed capital contribution of the company is 40 million yuan and holds 80% equity; Jiangxi Black Cat Carbon Black Inc.Ltd(002068) the subscribed capital contribution is 100 million yuan and holds 20% equity. The new project of the joint venture is planned to be 50000 T / a PVDF and supporting industrial chain project. The above matters were considered and adopted at the second meeting of the Fourth Board of directors of the company.
2、 Background of this foreign investment
1. Make full use of the energy consumption advantages of partners
With the continuous and in-depth promotion of the dual carbon policy, the control of energy consumption indicators in various provinces in China has become more and more strict. At present, energy consumption indicators have become the pre-approval conditions for new projects of industrial enterprises. This foreign investment will use the stock energy consumption index of Jiangxi Black Cat Carbon Black Inc.Ltd(002068) Wuhai base to support the energy consumption index required for project initiation according to the reduction substitution mode, and complete the relevant energy assessment procedures in time.
2. Further expand the existing product scale of the company
PVDF, as an important material in emerging industries such as lithium battery and photovoltaic, has sustained high market demand and rapidly expanded production capacity, which will further improve the bargaining power with downstream enterprises, strengthen customer stickiness and enhance market competitiveness. 3. Wuhai’s industrial advantages strengthen market competitiveness
The project is planned to be located in Wuhai Low Carbon Industrial Park, which has sufficient land reserves and can provide the whole construction land required by the project by stages. The park gathers major enterprises in the key links of the lithium battery industry chain, which is conducive to coordinated development and form the development effect of regional clusters. Wuhai has sufficient supply of local production factors, and the raw materials required for the production of the project, such as calcium carbide, electricity and steam, can be obtained at market competitive prices in the local and surrounding areas, so as to reduce product manufacturing costs and improve market competitiveness.
3、 The company to be established and the project to be constructed
The proposed company name is Inner Mongolia Lianhe fluorocarbon new materials Co., Ltd. (tentative name, specific name shall be subject to the name approved and registered by the market supervision and administration department). The joint venture plans to build 50000 T / a PVDF and supporting industrial chain project. At present, the proposed project has not been approved, the relevant land formalities have not been handled, the plant has not been constructed, the production equipment has not been purchased, the project approval has not been started, and the project needs to invest a lot of funds. At present, the company has not implemented the project financing plan. There are major uncertainties in the project from project initiation to construction completion to production, delivery and marketing.
The company will disclose the progress of the project in a timely manner in accordance with regulations.
4、 Risk tips
1. Both the company and its partner Jiangxi Black Cat Carbon Black Inc.Ltd(002068) have passed the review procedures of the board of directors. The company still needs to submit it to the general meeting of shareholders for review, Jiangxi Black Cat Carbon Black Inc.Ltd(002068) still needs to be submitted to Jingdezhen state owned assets supervision and Administration Commission for approval. There is still uncertainty whether the foreign investment is finally approved.
2. The joint venture plans to invest in 50000 T / a PVDF and supporting industrial chain projects, which requires a lot of funds. At present, the company’s own funds can not meet the full amount. The company needs to implement the project funds through various financing channels such as bank loans and project financing. There is a risk that the funds are not in place and the project cannot be implemented on schedule.
3. The new investment project has high requirements for energy consumption, and the national requirements for safety and environmental assessment of fluorine chemical industry in recent years are also high. There may be a risk that the pre-approval progress of energy assessment, environmental assessment and safety assessment is less than expected, resulting in the project construction progress less than expected. Although the partners can provide alternative energy consumption reduction solutions to complete the pre-evaluation procedures, the scheme still needs the permission of multi-level local governments, and there is a risk that the alternative scheme can not be approved on schedule.
4. At present, the company has an operating capacity of 3000 t / A, a capacity under construction of 5000 t / A, and a reconstruction project of 6000 T / a PVDF and supporting 11000 T / a hcfc-142b co production of 30000 T / a HFC-152a. In the process of handling the project procedures, the company will invest in the construction of 50000 T / a PVDF and supporting industrial chain project, which will pose greater challenges to the company’s technical reserve, management ability and human resources, There is a risk that the project construction and operation management are not as expected due to the mismatch of operation and management capabilities.
5. According to the third-party data, the existing capacity of PVDF in China is 82500 T / A, and it is expected that the new capacity will be about 120000 T / A in the next two years. Data source: Industry Online (authoritative data platform of fluorine chemical industry) and other third-party platforms. With the realization of production transformation and expansion plans of major manufacturers and the continuous operation of r142b-pvdf integrated capacity, the current phased imbalance by use will be alleviated, the supply and demand will gradually tend to balance, and the price of PVDF will return to normal. If the growth of the new energy industry is less than expected, there may also be phased overcapacity and downward prices, resulting in the risk of a sharp decline in profitability.
6. At present, the proposed project has not been approved, the relevant land procedures have not been handled, and the project construction still needs to be approved by the relevant procedures such as energy assessment, environmental assessment and safety assessment. The construction cycle is long, and there is a risk of delaying the completion date of the project due to the handling of project procedures, the adjustment of technical construction scheme and other factors. After the completion of the project, it will take a long time to reach production and sales, which will have an uncertain impact on the realization of future operating benefits.
It is hereby announced.
Lecron Industrial Development Group Co.Ltd(300343) board of directors January 22, 2022
