(report producer/author: Huaan Securities, Ma Yuanfang)
1 Industrial chain review: downstream demand is strong, upstream raw material supply increases
1.1 The third generation of high-performance fiber, excellent performance and extremely high barriers
ultra-high molecular weight polyethylene (UHMWPE) fiber, is the third generation of high-performance fiber after carbon fiber and aramid . It is the fiber with the highest specific strength and specific modulus among the current industrial high-performance fibers, excellent performance and extremely high barriers. Ultra-high molecular weight polyethylene (UHMWPE) fiber is a fiber spun by polyethylene resin with a molecular weight of more than 1 million. Its elongation rate of breaking is higher than that of carbon fiber and aramid, has good flexibility, and its mechanical properties are still good at high strain rate and low temperatures. Its impact resistance is better than carbon fiber, aramid, etc., and is a very ideal protective material. The industrialized production has been successful for nearly 30 years. Based on the continuous optimization of manufacturing technology and product performance, the downstream application fields have been continuously explored, and there is currently a supply gap.
UHMWPE fiber is a fiber with higher specific strength and modulus. Its strength is 15 times that of steel wire and 1.6 times that of aramid. Its impact energy is nearly twice that of aramid. It has physical properties such as wear resistance, light resistance, high energy absorption, soft and easy to bend, and has chemical properties such as corrosion resistance. It has excellent characteristics such as ultra-high strength, light weight, and impact resistance.
The market has different definitions of high-end UHMWPE fibers. For example, Millennium Long Fiber defines products with deniers of 800D and strength of 45g/D as ultra-high strength wires, and Tongyi Zhong defines fiber products with breaking strength of more than 35 cN/dtex as high-end products. We refer to the Ministry of Industry and Information Technology's "Guidelines for the First Batch of Application of Key New Materials" to divide high-performance products in UHMWPE fibers into ultra-high strength, heat-resistant and creep-resistant to different uses.
main raw material for ultra-high molecular weight polyethylene fiber UHMWPE resin is a white powder or granule polymerized from ethylene. The preparation raw materials also include solvents (white oil, dehydronaphthalene, etc.), extraction agents (hydrocarbon cleaning agent, dichloromethane, xylene , etc.). UHMWPE resin is made into powder and UHMWPE fiber is made through sol spinning process, and then the UHMWPE fiber is woven into intermediates such as UD cloth and fabric reinforced composite materials, which are used to make bulletproof and protective products.
Development history: Domestic companies break overseas monopoly, and the mid-to-high-end are still catching up. Ultra-high molecular weight polyethylene fiber and mat-free cloth products were listed as military supplies prohibited from exporting to socialist countries in the "Paris Coordination Agreement". The preparation of ultra-high molecular weight polyethylene was developed and monopolized by companies in the mid-to-late 20th century. In 1999, Donghua University and various enterprises and research institutions carried out production, academia and research combined , invented a new process of mixed solvent gel spinning, breaking the technical blockade of UHMWPE fiber, and Chinese enterprises gradually achieved technological breakthroughs. Because the UHMWPE fiber industry has good market prospects and economic benefits, many domestic enterprises have built dozens of new production lines to achieve large-scale production.
Foreign companies took the lead in researching and developing and producing, forming a monopoly (1970s-1990s): In 1979, the Dutch DSM Company successfully prepared ultra-high molecular weight polyethylene fibers, and then cooperated with Honeywell, the United States and Toyoshima, Japan, to start industrial production in 1990 and continuously improve the quality of fibers to expand the scale of use. Foreign leaders have monopolized the global sales market of UHMWPE fiber by means of technological blockade and price manipulation, and once listed it as a commodity prohibited from being sold to socialist countries.
Chinese enterprises achieved technological breakthroughs and large-scale production (1980s-early 21st century): my country began to develop the preparation of UHMWPE fiber in the 1980s, and gradually developed this technology from university laboratories to industrial enterprises. After achieving technological breakthroughs, domestic enterprises such as Tongyizhong, Hunan Zhongtai, and Ningbo Dacheng have formed relatively complete large-scale production capacity, and only achieved import substitution in some military industries. However, the domestic UHMWPE production capacity is mainly concentrated in the middle and low end, and high-end production capacity is still in short supply.
catches up with the international advanced level (2010 to the present): my country has filled the gap in the domestic market through research and development and preparation technology and mass production of UHMWPE fibers, and reached the same level as overseas leaders in terms of main indicators and functions. According to Tongyizhong announcement, Chinese enterprises have gradually completed three stages of domestic substitution: 1) From nothing to something: Domestic UHMWPE fibers and products have successfully achieved import substitution in key areas such as individual equipment, aerospace, marine engineering, ship cables, etc.; 2) Breaking the price monopoly: Overseas leaders have always used blockade technology to monopolize prices, but since 2005, my country has achieved industrialization and expanded production capacity, and the selling price of overseas related products has been reduced by more than 50%; 3) From nothing to better: UHMWPE fibers produced by Chinese enterprises are in strength, The parameters such as modulus have reached the international advanced level, and driven by national policies and market prospects, it still catches up with overseas leading companies in sub-sectors such as product consistency and stability, creep resistance, and continuously improves key indicators such as fracture strength, and continuously expands the scale of production capacity.
Representative domestic enterprises continue to grow through technological progress and market development. In the past twenty years, domestic UHMWPE fiber production enterprises have paid equal attention to technology upgrading and market expansion, achieving domestic import substitution and accelerated exports to the outside world. Taking Tongyizhong as an example, as one of the first companies to realize the industrialization of UHMWPE fibers around 2000, Tongyizhong continuously optimizes production processes, improves product performance, and develops new varieties. While getting rid of import dependence, the company has laid out overseas patents, won recognition from European and American customers, accumulated a series of high-quality customer resources, and increased 's profits and revenue scale.
As a strategic emerging industry, it has received policy support and encouragement to enhance international competitiveness. UHMWPE fiber is a material used in the military, protection, aerospace and other fields, and has been protected by national policies and has been listed as "encouraging industries" and "key strategic materials". The state has issued a series of policies to encourage UHMWPE fiber to expand the military and civilian fields, improve performance, reduce costs, etc., and supports related enterprises through certain tax incentives, and encourages the formation of a number of large enterprise groups with international competitiveness in the industry.
UHMWPE fibers are made by gel spinning process and can be divided into wet and dry methods. The dry process and the wet process were spinned using a high-volatile solvent dry gel and a low-volatile solvent wet gel, respectively. Due to the different solvent characteristics used, the subsequent solvent removal process is also completely different. The two processes have their own advantages and disadvantages. The drying process is fast and the process is simple. The spinned products are of better quality, but relatively low safety and high requirements for the operating efficiency of the equipment and recycling system. The global leader, Dutch DSM, mainly uses dry process to prepare UHMWPE fibers. Currently, the domestic production capacity is mainly wet process. Jiujiujiu, Tongyizhong, Millennium fiber, etc. have all prepared UHMWPE fibers through wet process routes. Only Yizheng Chemical Fiber has a dry process. The solvent used for dry gel spinning of
is generally dehydronaphthalene with low boiling point, high volatility and good solubility to UHMWPE. UHMWPE and dehydronaphthalene are kneaded in twin-screw extruder to form a solution with a concentration of no more than 10%, and then extruded through spinneret , entering a channel with hot nitrogen to remove the solvent, and after cooling, a dry gel raw silk is formed, and then UHMWPE fibers are made by multi-stage high-power heat stretching. The technical difficulty of dry gel spinning process is high, and the requirements for the sealing of the recycling system are high, but its advantages are mainly: 1) The process is shorter, the production efficiency is high, and the cost is lower; 2) The solvent can be directly recycled, which is more conducive to environmental protection; 3) Under the same conditions, the fibers prepared by dry process have higher crystallinity and mechanical properties, greater fiber density, and better thermal stability; 4) Good luster, soft feel, and low solvent residue, which is suitable for medical and spinning fields. The Dyneema fiber from the Dutch company DSM overseas and the ICEMAX series fabrics from Japan Toyoshi are made of dry methods and are used in the medical and home textile fields respectively.
wet spinning production process uses white oil with high boiling point and low volatile properties as solvents, and dissolves the ultra-high powder in white oil to make a spinning raw liquid, then extrudes it into a fluid wire strip through the spinning assembly, and then cools through a water bath to form a frozen gel wire strip. The frozen gel wire strip is extracted, dried and desolved to form an unstretched raw wire, and then it is heat stretched to make the finished fiber. The technical difficulty of wet process technology and the requirements for equipment are lower. At present, most domestic enterprises use wet spinning technology to produce military and civilian fiber products of different deniers and strengths. However, it mainly focuses on mid- and low-end products. Optimizing the existing process route and further improving the mechanical properties, stability and functionality of the fibers is the focus of current wet process route research.
gradually solves problems such as creep resistance and heat resistance through technical upgrades. In addition to raw materials and gel spinning processes, different parameters such as solvent concentration, temperature, light and other parameters as well as different extraction and stretching processes in the process flow have an impact on the characteristics of UHMWPE fiber finished products. Therefore, in the preparation of UHMWPE fibers, in addition to the necessary raw materials, machinery and equipment and technicians, parameters need to be debugged and run-in according to the product performance requirements. At present, the common pain points in the UHMWPE fiber industry are poor heat resistance and creep resistance, which makes it unusable in high temperatures or long-term stretching. According to the "Research Status and Analysis of Ultra-High Molecular Weight Polyethylene Fiber and Its Composite Materials" by Ye Zhuoran et al., the viscosity of UHMWPE fibers can be changed by adding modifiers and adjusting ultraviolet radiation, so as to improve its heat resistance and creep resistance without losing the mechanical properties of the fiber.
1.2 has a wide range of downstream applications, with stable growth of military use and civilian use entering the fast lane
Military protection is only a classic application scenario, and civilian scenarios require more space and potential. UHMWPE fibers have high strength, low density, cool sensitivity, higher than heat capacity, and low conductivity, and are lower than other high-performance fibers with similar characteristics, and are used in various scenarios. Its downstream application areas mainly include military equipment, security protection, marine industry, construction industry, textile industry, etc. The Forward-looking Industry Research Institute predicts that the national demand for UHMWPE fiber will be 57,800 tons in 2021, and the market demand will grow strongly. By 2025, the demand will increase to 103,800 tons, with a CAGR of 15.8%; the global demand will range from 109,000 tons in 2021 to 165,000 tons in 2025, with a CAGR of 10.9%.
In the field of national defense and military, UHMWPE gradually replaced aramid and became the preferred material for bulletproof. Ultra-high molecular weight polyethylene can be made into bulletproof vest , bulletproof helmet , armored protective panel, radar protective shell cover, missile cover, etc. in military use. The composite material has a relatively high load value of U/p, which is 10 times that of steel, more than 2 times that of glass fiber and aramid, and has a density of about 2/3 of that of aramid, so the bulletproof clothing made of stronger protection and lighter wear. According to the "China Chemical New Materials Industry Development Report (2018)", 70% of the ultra-high molecular weight polyethylene fibers in Europe and the United States are used in military fields such as bulletproof vests, bulletproof helmets, bulletproof armor for military facilities and equipment, aerospace, etc., while due to limited high-end production capacity in my country, the proportion of bulletproof vests and weapons and equipment is only 32%.
The arms game between major countries, and the gap in military expenditure between China and the United States has decreased. Judging from the military expenditure, the US military expenditure has stabilized at around 4.5-5 trillion yuan in the past decade, while China's military expenditure increased from 721.7 billion yuan in 2009 to 1.8 trillion yuan in 2019, with both the gap ratio and absolute value decreased.
According to GVR data, the market size of bulletproof textiles in 2016 was US$1.637 billion, and the market size is predicted to grow to US$2.33 billion by 2025. Among them, Europe and North America are the largest regions and Asia has the fastest growth rate, with 16-25CAGR of 4.7%. According to data from the Forward-looking Industry Research Institute, my country's UHMWPE military demand has grown faster, with the expected demand in 2025 to be 25,000 tons, double the increase from 2020.
Marine field: corrosion resistance and other properties are better than traditional ropes and cables, and can be used in marine engineering and deep-sea aquaculture. UHMWPE fiber is the only high-performance fiber with a density that is lighter than water and can float on the water surface.The ropes, cables, and cages made of it have a breaking length of 8 times that of steel ropes and 2 times that of aramid. They are used to fix anchor ropes for tankers, marine operating platforms, lighthouses, etc., which solves the problems of reducing and breaking of cable strength caused by corrosion, hydrolysis, ultraviolet degradation, etc. in the past when using steel cables, and corrosion, hydrolysis, ultraviolet degradation, etc., and require frequent replacement, which can ensure a longer service life. The Forward Industry Research Institute predicts that the demand for UHMWPE fiber in the marine industry will grow from 12,200 tons in 2020 to 24,600 tons in 2025.
textile and sports equipment applications help UHMWPE civil demand move towards the fast lane. In the field of textile and clothing, due to the coolness and wear resistance of UHMWPE, the summer clothing home textiles are cooler and more comfortable, and jeans and other clothing are more wear-resistant and wear-resistant. For example, the Dutch DSM UHMWPE fiber denim has a wear resistance and tear resistance strength of 7 times that of ordinary denim. In the field of sports goods, UHMWPE fiber can be made into hard helmets, snowboards, sailing boards, fishing rods, rackets, bicycles, gliding boards, etc. Due to its excellent characteristics, it is more durable and lighter than traditional materials. However, due to limited production capacity and high price, UHMWPE fiber is mainly used in bulletproof and protection fields, and its application in light industry and textiles has not yet increased. We believe that compared with the military field, the civilian field has a wider demand and greater coverage. With the increase in supply-side production capacity, UHMWPE fiber penetrates civilian markets such as textiles and sporting goods, which will help the UHMWPE fiber industry expand its revenue scale and profitability.
Medical Biomaterials : UHMWPE fiber reinforced composite is used in dental tray materials, medical grafts and plastic sutures. It has good biocompatibility and durability, and has high stability, will not cause allergies, and has been used in clinical practice. In addition, UHMWPE fiber can also be used in medical gloves and other medical measures. Changes in demand structure: military proportion is high but space is limited, and the penetration rate of civilian has increased. According to data from the Forward Industry Research Institute, the UHMWPE military market size was 8,800 tons in 2015, accounting for 43.8% of the total production capacity. In 2019, the scale increased to 10,700 tons but the proportion decreased to 25.8%. It is expected that market demand will expand to 250,000 tons in 25 years, but the proportion will decrease to 24.1%. Correspondingly, the proportion of civilian fields such as safety protection, textiles and sports equipment has increased. At present, the bottlenecks of civilian UHMWPE fibers are mainly: 1) The raw materials are limited and the cost is high. Compared with traditional chemical fibers, UHMWPE fibers do not have price advantages and have less market demand; 2) The overall production capacity is limited, and they are given priority in the more important military and police fields, and the supply side has less development in the civilian fields. Due to the complete textile manufacturing industry chain in China, we believe that after the UHMWPE fiber production capacity increases, the expansion of the civilian field can achieve the expansion of the overall market and promote the healthy development of the UHMWPE industry.
1.3 Raw materials UHMWPE resin: supply and demand balance, supply expansion
Raw materials and manufacturing costs are the main components of cost. According to Tongyizhong's 21-year annual report, although the unit price of super high powder of major raw materials fell during the reporting period, the company's direct material still accounted for 49.43% of the total cost. The manufacturing cost of Millennium Dragon Fiber accounts for a higher proportion, at 62.93%. The main reasons are: 1) The company's annual capacity utilization rate is low, and the various discounts included in the manufacturing cost are relatively high; 2) The production fibers of Millennium Dragon Fiber accounts for a high proportion, with a long production cycle, and the proportion of manufacturing cost increases when raw materials are fixed.
As of 2021, there were 400,000 tons of UHMWPE raw materials worldwide. The raw materials are based on Limu Consulting data. As of the end of 2021, the global UHMWPE raw material production capacity except China was 300,000 tons and the domestic production capacity was 100,000 tons. Compared with Tongyizhong's prospectus, the global annual production capacity was 221,000 tons in 2016, and the global annual production capacity was 179,000 tons in five years. The major overseas suppliers include Seranis, Brazilian Blask Company, Dutch DSM Company and Japan Mitsui Chemical Company, etc., and domestic suppliers include Henan Watson Super High Chemical Technology Co., Ltd., Sinopec Yanshan Petrochemical, Shanghai Lianle Chemical Technology Co., Ltd., Jiujiang Zhongke Xinxing New Materials Co., Ltd., etc.Celanis is the world's highest production capacity company. It has set up ultra-high molecular weight polyethylene production bases in Germany, the United States and Nanjing, China. With the 15,000 tons production line put into production at the beginning of 2022, Celanis' total production capacity is 120,000 tons, accounting for about 29% of the global total production capacity. Referring to the prospectus manual, Tongyizhong is mainly imported raw materials by Japanese TTC company (Assasahi Kasei agent), and less than 10% of PE powder is purchased from domestically; Millennium Dragon Fiber is purchased from domestic Lianle Chemical.
UHMWPE resin is polymerized from ethylene raw materials, and mainly uses plates, pipes, fibers and diaphragms. The UHMWPE resin powder used in different forms is different. The supplier will debug parameters such as molecular weight and product particle size distribution according to downstream requirements. Among them, UHMWPE fiber based on the melt spinning process is a high-end application, with having a premium higher than boards and pipes, and the raw material supply is basically stable.
Yulong Refining Chemical put into production 100,000 tons of raw materials, the upstream supply expands, and the middle and lower reaches enter the cost reduction range. , Nanshan Group , Yulong Petrochemical, integrated high-quality resources of mainland refining enterprises in Shandong Province, launched a plan to be 40 million tons/year refining and chemical integration project Yulong Island Refining (Phase I). According to the environmental impact assessment report, Yulong Petrochemical plans to produce 100,000 tons of ultra-high molecular weight polyethylene raw materials, roughly equivalent to the total national production capacity in 21 years. We believe that after the 100,000 tons of UHMWPE raw materials of Yulong Refining and Chemical are put into production: 1) Ensure the stable supply of upstream raw materials and change the pattern of importing some raw materials in my country; 2) Increase the scale effect of mass production of raw materials, effectively reduce the cost of raw materials, increase the share of UHMWPE fiber in bulletproof protection and marine applications, and expand its use in clothing, home textiles, sports goods and other scenarios.
1.4 Product extension through composite materials to increase product added value
Common composite materials include UD cloth and fabric reinforced composite materials, which are intermediate products from UHMWPE fiber to terminal products.
UD Cloth is also known as one-way cloth or weft-free cloth, and can be used as backing material for bulletproof products. UD cloth is a composite material in which UHMWPE fibers are impregnated with resin substrate and arranged in parallel to form a single layer of UD prepreg, and several prepregs are pressed in parallel or orthogonal layers, and there is no interweaving of fibers within and between layers. UD cloth has good toughness, impact resistance and adaptability in various environments. Currently, 45% of UHMWPE fiber material is used to produce UD cloth, which is divided into soft and hard. Among them, soft UD cloth is usually used as soft body armor, and hard UD cloth is used to produce back plate materials for bulletproof helmets or bulletproof plates.
Fabric reinforced composite material process is more complex and has stronger stability. Fabric reinforced composite materials refer to composite materials made of weaving fibers into fabrics and cured by the overall wet resin. Compared with UD cloth, its process is complex and has more designability. The woven fabric fibers have less bent, so they have stronger mechanical stability, dimensional stability and shear resistance than UD fabrics, and have more interweaving and friction, and have better energy absorption, impact resistance and toughness.
Refer to the data in Tongyou, composite materials have higher added value compared to fibers. Tongyizhong is the top three UHMWPE fiber production capacity in my country, and is also the first listed company that mainly engages in the production and sales of UHMWPE fibers and composite materials. According to the data disclosed by Tongyizhong, the ton of UHMWPE fiber is between 80,000 and 110,000 yuan, while the ton of is between 160,000 and 200,000 yuan, which is about twice the price of UHMWPE fiber. In terms of gross profit margin, Tongyizhong UHMWPE fiber granule interest rate is 27%-33%, while composite material gross profit margin is 35%-42%, which is obviously higher than fiber. We believe that UHMWPE fiber manufacturers use their own advantages to layout the manufacturing field of composite materials such as weft-free fabrics, which is an extension of the industrial chain, which is of some help to improve the company's profitability and expand UHMWPE business.
2 Industry structure: supply and demand are tight, and the high-end
2.1 The trend of supply and demand continues, and high barriers bring excellent pattern
The global market supply and demand are tight, and downstream demand is expected to continue to increase. In 2020, the global current ultra-high molecular weight polyethylene fiber production capacity will be around 65,600 tons, the theoretical demand will be 98,000 tons, and the capacity gap will reach 33%.According to the Forward Industry Research Institute's forecast, global demand for UHMWPE fiber continues to grow, reaching 165,000 tons in 2025, with a CAGR of 11.2% in the past ten years. From a domestic perspective, the domestic UHMWPE fiber production in 2019 was 41,000 tons, accounting for 63% of the global output that year, and the domestic demand was 41,500 tons. The demand and capacity CAGR from 2015 to 2019 were 20.0% and 7.7% respectively.
my country UHMWPE fiber starts but expands quickly. The preparation process of UHMWPE fiber was first developed by Royal Dutch DSM. Dutch DSM, American Honeywell and Japanese Toyo String were industrialized in the 1980s. Due to its ultra-high performance in the military field, UHMWPE fiber was once banned from exporting to socialist countries. In the last century, the domestic industry, academia and research were led by the Southeast University and the Textile Research Institute, and the industrialization of UHMWPE fiber was realized after 2000. Currently, the main enterprises in the UHMWPE fiber field in China include Jiangsu Jiujiujiu (the parent company is Yan'an Bikang ), Beijing Tongyizhong, Shandong Aidi (DSM's joint venture in China), Millennium Dragon Fiber, Jiangsu Suqiang Nima, etc. Although the country continues to break through technical barriers and increase production capacity, the main products are still anti-cut glove wires, protective wires, etc., and there is still a gap between high-end production capacity and overseas leaders. We believe that UHMWPE fiber, as the first choice fiber in the military field, has been supported by national policies. Major domestic manufacturers are actively expanding their production capacity. At present, it is known that the capacity under construction will be 5,280 tons (it is expected to be put into production in 23Q1, and another 20,000 tons will be started on 22Q3), Tongyizhong 2,240 tons (it is expected to be put into production by the end of 23Q), Millennium Dragon Fiber 5,000 tons (it is expected to be put into production by the end of 23Q) and Nanshan Zhishang 3,000 tons (it is expected to be put into production in 23Q4). By the end of 23, at least 15,000 tons of UHMWPE fiber production capacity nationwide has been added, which is conducive to increasing industry supply and promoting healthy competition.
2.2 Tongyizhong: layout of the entire industrial chain, continuous release of production capacity
Tongyizhong was established in 1999. It is a high-tech enterprise specializing in the research, development, production and sales of UHMWPE fibers and composite materials. Tongyizhong is one of the first UHMWPE fiber industrialization enterprises in 2000. UHMWPE fibers are prepared using a wet process using hydrocarbon extractant. The UHMWPE fiber products it produces include cable wires, fishing wires, anti-cut wires, bulletproof wires, , etc., and UHMWPE weft-free fabrics, cut-proof and anti-blade fabrics and other fabrics, as well as terminal products such as bulletproof helmets, bulletproof vests, bulletproof armor, high-performance ropes and cables. According to the announcement, after 21 years, high-end soft and hard bulletproof weft-free fabrics produced based on the company's UHMWPE fiber were launched on the market, it gradually gained market recognition. Among them, WB876 products are used in the new generation of individual protective equipment of our army and high-end protective equipment of the police.
profit increased after listing, and was included in the list of "Little Giants" for specialized and specialized . Tongyizhong was listed on the Science and Technology Innovation Board in 2021. At the same time, it won the title of "13th Five-Year Plan" technological innovation demonstration enterprise of the Chemical Fiber Association and was selected into the list of national specialized and innovative "little giants" enterprises. The company used the funds raised from the listing to expand its production capacity and increased its high-end share. In 21 years, it achieved operating income of 331 million yuan, an increase of 16.95% year-on-year; net profit attributable to shareholders was 52.5279 million yuan, an increase of -7.72% year-on-year; 22H1500 tons of lattice production + high military demand prosperity drove the company's volume and profits to increase both, and operating income and net profit attributable to shareholders increased by 81.91% and 151.69% respectively compared with the same period last year. The company's 21-year and 22H1 net sales margins were 15.9% and 26.7% respectively.
mainly sells UHMWPE fibers and composite materials, and the proportion of domestic sales has increased. The company's UHMWPE fiber business and composite materials business accounted for 67.75% and 29.55% in 2021, respectively, and the proportion of fiber business increased in the same period, mainly due to the release of in the new production capacity in 21 years. The company's exports accounted for nearly 70% before 20 years. In 21, due to the significant increase in domestic sales due to the release of production and capacity, domestic sales revenue was 141 million yuan, up 60.8% year-on-year, accounting for 42.5% of revenue, which is the highest domestic sales share in five years.
produces and sells vigorously, and some products are self-used downstream. As of the end of 2021, the company had a total of 3320 tons of UHMWPE fiber production capacity and 300 tons of weft-free fabric production capacity, and had 2240 tons of UHMWPE fiber production capacity and 2500 tons of weft-free fabric production capacity. It is expected to be completed by the end of 2023.From the perspective of production and sales, the company's production line is basically at full capacity, with the capacity utilization rate of at above 100%. The production and sales rate of at is mainly due to some UHMWPE fiber self-use production composite materials and some weft-free cloth products used to produce downstream body armor, helmets and other products. According to the company's prospectus, the company's UHMWPE fiber and weft-free fabric self-use and sales accounted for 98.5% and 106.2% of the output in 2020; in 20 years, the company sold 487.6 tons of high-end fiber products with a breaking strength greater than 35 cN/dtex, accounting for 26.5% of all fibers, of which 452.3 tons were self-use.
IPO raised 225 million yuan to expand production capacity and increase the proportion of high-end. Tongyizhong raised 225 million yuan in the listing at the end of 21 to add 2240 tons of UHMWPE fiber, 2500 tons of weft-free cloth, 500,000 bulletproof chest inserts and 180,000 helmets. At the same time, it built a research center for high-performance fiber and advanced composite materials technology to strengthen the research and development of high-strength and low-creep products, accelerate the improvement of fiber and composite materials performance, and expand downstream application fields from multiple angles. The company's fundraising and investment project will begin construction in 2022 and is expected to be completed within 24 months.
2.3 Nanshan Zhishang: Relying on Yulong Petrochemical, it has integrated advantages
Nanshan Zhishang has a production capacity of 3,600 tons, and wants to enter the first echelon of UHMWPE fiber in China. Nanshan Zhishang is the leader of the domestic wool worsted clothing industry chain. In 21 years, it has built a 600-ton UHMWPE fiber production capacity and put into production and sale on 22H2. The company issued a convertible bond plan in July 222, and plans to raise 699.58 million yuan to build the second phase of the 3,000-ton UHMWPE fiber project. After reaching production, it will form a 3,600-ton UHMWPE fiber production capacity. At present, there are no more than five domestic companies with UHMWPE fiber production capacity of more than 3,000 tons. After the construction of the two phases of project of Nanshan Zhishang, it will be ranked among the first echelon of UHMWPE fiber in China. Based on the group's endowment and the accumulation of weaving of the entire industrial chain of wool worsted thread, the entire industrial chain of new materials is planned and laid out. From the perspective of raw materials, Nanshan Zhishang and Yulong Refining and Chemical are both under Nanshan Group . Yulong Refining and Chemical is under construction with a capacity of 100,000 tons of UHMWPE raw materials to ensure the company's raw material supply. From the perspective of process technology and talent team, 600 tons of Nanshan Zhishang Phase I was put into production and sales, completing a breakthrough from 0-1 in new materials, and intending to expand the production capacity of 3,000 tons to achieve a 1-10 in excess. This is the result of the full running-in of talent team, machinery and equipment and process technology, which is sufficient to prove the company's R&D and production capacity. From the downstream perspective, Nanshan Zhishang has more than 30 years of experience in wool fine textile production and deep cultivation of the entire industrial chain of wool fine textile clothing, and has the ability to manufacture composite materials and terminal products. According to the company's announcement, UHMWPE's fiber business adopts the most advanced production equipment in China and is equipped with complete public engineering equipment, integrating R&D, production and sales, and can provide differentiated ultra-high molecular weight polyethylene fiber product solutions for segmented customers.
2.4 Millennium Dragon Fiber: Focus on UHMWPE fiber, develop a variety of fibers to expand the market
Focus on UHMWPE fiber, and continuously explore emerging markets. Millennium Dragon Fiber was established in 2010 by Qianxi Group, focusing on the research, development, production and sales of UHMWPE fibers. The products are widely used in defense and military equipment, aerospace, protective supplies, marine fishery, cables, sports goods, medical devices, building materials and other fields. Millennium Dragon Fiber basically covers the current mainstream market of UHMWPE fiber and actively expands to emerging markets: a full range of colored fibers, malting/semi-malting functional fibers have been developed for the civil market; an ultraviolet-resistant aging fiber has been developed for the application environment exposed in the environment; a new and more cutting-resistant product has been developed for the upgrading of European cut-resistant gloves standards, etc. Millennium Dragon Fiber withdrew after applying for the GEM IPO in 2020, mainly because the Sino-US trade friction and the new crown epidemic affected the export of special fibers and products after 19 years. The company's largest customer is the American Shengran Company, which accounted for 26% of its sales revenue in 2020, and the company's volume and profit declined.
2019 It grew rapidly before 2019, but then declined due to trade frictions and the epidemic. Millennium Longfei's revenue and net profit attributable to shareholders in 2019 were RMB 234 million and RMB 69.42 million, respectively, +36.2% and 193.2% year-on-year respectively. In 2020, the company's operating income and net profit attributable to shareholders in 2019 were -28.3% and -81.8% year-on-year respectively.In 21, production and logistics recovered, with a narrowing decline. The company's revenue was 179 million yuan, an increase of 7.1% year-on-year; net profit attributable to shareholders was 9.32 million yuan, an increase of -26.3% year-on-year.
products focus on fibers and develop non-ferrous wires and ultra-high-strength wires to expand profit margins. Millennium Dragon Fiber mainly sells UHMWPE fiber, with conventional wire accounting for 93.5% in 2017. After that, the company developed non-ferrous wire suitable for civilian use, ultra-high-strength wire with strength exceeding 800D and other products put into the market. In 21 years, the sales of non-ferrous wire and ultra-high-strength wire accounted for 17.6% and 2.9% respectively. In terms of profitability, the ton price of conventional wire, non-ferrous wire and ultra-high strength wire in 21 years was RMB 65, RMB 135, and RMB 107,000, respectively, and the gross interest rates were RMB 14.6%, 58.8% and 47.4% respectively. Nonferrous wire and ultra-high strength wire have expanded the company's UHMWPE fiber products, improved profitability, and to a certain extent hedged the impact of a sharp decline in product prices on the company.
The company's current production capacity is 3511 tons, and it has not released all production capacity due to the impact of the epidemic. At the end of 2021, including the annual production capacity of its subsidiary Longyoulong Fiber, Millennium Long Fiber has a total of 3511 tons of UHMWPE fiber production capacity. In 2020, under the impact of the new crown epidemic, the company's production and sales were affected, especially the loss of overseas orders, so the company's production capacity was not fully released.
is listed on the New Third Board, and a new capacity of 5,000 tons of UHMWPE fiber and 620 tons of weft-free fabric is built. Millennium Dragon Fiber was listed on the National Small and Medium Enterprises Stock Transfer System on August 23, 2022. According to the announcement, the company expanded the production capacity of 5,000 tons of UHMWPE fiber in Shanxi. The first phase of 2,000 tons is expected to be put into production in June 2023, and the remaining 3,000 tons are expected to be put into production in December 2023. In addition, the company is expected to add an annual production capacity of 620 tons of UHMWPE fiber weft-free fabric through technical transformation projects in 22Q4.
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selected report source: [Future Think Tank]. system error
