echoes Trump's policies, and China has recently set off another wave of infrastructure. As steel and cement prices recovered from the full recovery, related building materials stocks also rose gratifyingly.
However, it is little known that the "reinforced cement" in the electronics industry has also been increasing prices for various reasons in the past year. Jiantao Laminated Plate (01888), which uses copper clad plate as its main product, has benefited greatly as its representative.
's stock price remained at a platform range of around 2.7 to 3.6 from 2012 to 2016. Since February 2016, the stock price has soared like a awakened dragon. In less than a year, it soared from HK$3 to HK$9 (the same unit below).
The world's first copper clad plate
Jiantao laminated plate (hereinafter referred to as the company) is a subsidiary of Jiantao Chemical (00148), which is mainly engaged in the production of copper clad plates and upstream copper foil , glass fiber and other products. There are two types of copper-clad board products, epoxy glass fiber copper-clad panels and paper copper-clad panels. The downstream is more than 1,200 printed circuit board manufacturers.
In December 2006, the laminated board business was listed separately in Hong Kong. Currently, the company's largest shareholder is Jiantao Chemical, with a 73.13% stake.
Copper clad laminate is the full name of Copper Clad Laminate (CCL) and is the basic material of the electronics industry. It is mainly used for processing and manufacturing printed circuit boards (PCB). It is widely used in electronic products such as television, computers, mobile communications, etc.
According to data from Prismark Partners LLC, the company ranks first largest copper clad manufacturer in the world for eleven consecutive years. In 2015, the world's top three copper clad manufacturers Jiantao Laminated Plate, Shengyi Technology , and South Asia had market share of 14%, 11%, and 11%, respectively.
extends the industrial chain upwards, and vertical integration of brings advantages
Copper foil is an important material for copper clad plates. From the beginning of 2016 to the present, the price of copper foil for copper clad plates has increased by more than 50%.
Under this situation, major copper clad plate manufacturers have followed up to raise their ex-factory prices. Since July 2016, major copper clad plate manufacturers such as Jiantao Laminated Panel, Shengyi Technology, Lianmao, and South Asia have successively issued price increases notices.
According to relevant information, 30% of the production cost of copper clad plate is labor and manufacturing costs, and the remaining one is the upstream raw materials: copper foil accounts for the largest proportion, about 35%, and resin and fiberglass cloth each account for about 18%.
Against the backdrop of a surge in raw materials, the benefits of the company's industrial chain extending upward are fully reflected. In addition to the initial raw materials from external procurement, the direct materials of copper clad plate, copper foil, resin and fiberglass cloth are all produced by the company themselves. 80% to 90% of these raw materials are self-used by the company, and the rest are sold externally. In terms of copper foil, the company is the world's third largest electronic copper foil manufacturer. It currently has a monthly production capacity of about 6,000 tons of copper foil, of which 10% are sold to the public, including 100 tons of lithium battery copper foil. These copper foils are produced by Jiantao Copper foil, which is indirectly held by the company, with a 65.95% stake.
htmlOn February 22, the company announced the latest annual unaudited performance of its affiliated Jiantao Copper Foil, with sales slightly rising 1.75%, gross profit rising 4.16%, while net profit fell 62.65% to HK$1.06 million, mainly due to losses attributable to associates.Zhitong Finance searched relevant information and found that although its losses were caused by the attributable associates, its turnover only increased slightly by 1.75% when the copper foil market was very good. After further research, it was found that Jiantao copper foil does not directly produce and sell copper foil, but produces it by renting copper foil production capacity from the company, and collects a certain rent from the company every year. The income arrangement method of
allows the company to not have to bear the premium other than the increase in raw material costs, making the company's cost control ability always stronger than its peers.
Zhitong Finance compiled the operating profit margins of the company and Shengyi Technology in recent years, and through comparison, you can also get a glimpse of the company's vertical integration advantages.
Real estate side business icing on the cake
According to the company's 2016 working year financial report, revenue was 7.522 billion yuan, a year-on-year increase of 15%; net profit attributable to shareholders of listed companies was 840 million yuan, a year-on-year increase of 35%.
According to the financial report business analysis, its copper clad panel contributed more performance on the basis of a year-on-year decline, but due to the increase in gross profit margin (from 17% in 2015 to 19% in the first half of 2016).Compared with 2015, the revenue and profit of the property sector increased dramatically.
Company reserved 1.18 million square meters of land with a construction area in Kunshan and Jiangyin in Jiangsu between 2010 and 2012, and has now built residential or shops for sale. The main reason for this property revenue increased by 1.5 billion yuan. The main reason is that in the first half of 2016, the third phase of Jiantaoyu Garden, Kunshan Development Zone, will be sold in the second half of 2016. Residential sales revenue will be recorded one after another, and it is judged that it will contribute 1.5 to 2 billion yuan in revenue.
Benefiting from the hot state of Shanghai's real estate market, real estate prices in Kunshan area were radiated and rose by about 30~50% in 2016. Currently, the selling price of Kunshan real estate projects has reached 18,000~19,000 yuan/square meter. Compared with the cost of 2,000~4,000 yuan/square meter when the company acquired land, the net profit margin is expected to reach 15~20%, and the profit is considerable.
However, the company's management is still quite calm. Faced with the booming real estate business, it had previously decisively stated that "stop when it is better": after completing the digestion of existing land reserves, the company will no longer continue to invest in the real estate field in the future, but will focus more on the copper clad industry chain.
copper foil may help you another
global copper foil market totals about 20 billion yuan, which is a relatively small industry. Downstream applications are limited to few industries such as PCB and lithium batteries. The former's application products are called electronic copper foil or standard copper foil, and the latter is called lithium battery copper foil.
Before 2013, the PCB industry was in a downturn, new energy vehicles had not yet developed, and the competition in the copper foil industry was very fierce. The industry has overcapacity as a whole, and the overall capacity utilization rate of is above 60%, and there is almost no new capacity added.
With the development of new energy vehicles, the demand for copper foil has increased rapidly, and the utilization rate of enterprises' production capacity has increased rapidly.
According to industry data, the average growth rate of global lithium battery shipments in the past three years has reached 28%, of which the year-on-year growth of lithium battery shipments in 2015 has reached 39%. In 2016, the sales of new energy vehicles were 620,000, an increase of 76% year-on-year. Although the subsidies for new energy vehicles further declined in 2017, new energy vehicles are expected to grow rapidly under a small base, and lithium battery shipments will also maintain rapid growth year-on-year.
At the same time, the prosperity of the PCB industry also rebounded in 2016. Among them, the demand for automotive electronics has grown rapidly in recent years. Although the overall demand accounts for about one-tenth of PCB, the growth rate is about twice the demand for traditional communication equipment.
This structural change brought about by the increase in demand and limited production capacity have caused the above-mentioned sharp rise in copper foil prices.
Moreover, the current situation of high copper foil price is expected to remain. Because new production capacity often requires one to two years of construction cycle. What's even more serious is that one of its production equipment is the core equipment, and currently Chinese copper foil manufacturers are ordering from a Japanese company. The Japanese company itself has a low production capacity and order shipments will have to wait until 2018.
A shares, the two companies involved in copper foil production, have been ranked after 2018 for new production capacity.
The company previously planned to have a new production capacity of 2,000 tons per month in the third quarter of this year, a small part is used for lithium battery copper foil, and most of it is still used for electronic copper foil. Citi reported not long ago that the company has locked in LG and BYD (01211) as its new copper foil customers.
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