二、Shandong renewable resource projects
Item Number: G-2013-1001-003-A
Categories: industry (G); subcategories: 2013; rating: Independent Archive (1001); A: overseas listed
(一)、Location of listed: Hong Kong main board
(二)、Time of listed: 2014
(三)、Project Description:
Project Company was founded in 2001, it is one of the leading companies in Chinese metal recycling and manufacturing industry and the only comprehensive enterprise that can reuse the renewable metal(including recycling, separating, smelting, processing and other production sections).
1、Industry: Industrial (recycled metal manufacturing)
2、 The main business: Production and sales of renewable stainless continuous steel casting, stainless steel strip and profiles.
3、 Company qualification: State "high tech enterprise"
4、Turnover / net profit in the latest three years: Not available.
5、Analysis on the profit point:
(1) A huge space for industrial growth
With the further development of China's economic,there is a rapid increase on the demand of stainless steel and copper in China, owing to the scarce mineral materials in China such as iron ore and copper mine, a high percentage of nearly 5% of iron ore and 8% of copper mine are depended on importing. Therefore, scrap metal recycling and processing is extremely important for the protection of the sources of these materials.
In recent years, as the expansion of the recycled non-ferrous metal industries, the demand for the products is increasing, major recycling non-ferrous metal has been increased from 720,000 tons in 2000 to 633,000 tons in 2009, and the annual growth rate has reached 27%. In September 2010, the main renewable non-ferrous metal production is about 5.55 million tons with a year-on-year increase of 17%, of which the weight of recycling copper is 1.75 million tons with an increase of 17%.Taking into account that there is a tight supply of the domestic refined copper and scarce copper mines, it can only be predicted that the future of the recycling copper is a continuous rapid increase.
(2) The government will streghten it's support on a yearly basis
In January 2009, on the "Non-ferrous metal industry restructuring and development plan" issued by the National Development and Reform Commission, it has clearly mentioned it will provide support to construct the recyling trading and dismantling market in the qualified region. Encourage the qualified enterprise to adapt a high efficient, low consumption and pollution craftwork, equipments and establish several production lines with an annual production of more than 300,000 tons of renewable copper and alluminium, enlarge the size of utiilzing of materials, upgrade the technology and products, reduce the consuming of mineral resources.
Government policies such as zero import&export tariff, home appliances subsidies, favorable policies on land will be issured and encourage using of crapt metal have been provided to support the recycling metal industry. Looking to the future, more favorable tax free policies will be released.
(3) It is the only enterprise in its industry which can produce copper and stainless steel by using recycling metal comprehensively.
Since it's establishment in 1998, the productivity of it's main products has shown a fast trend of developing, and the capability of an annual production of 80,000 tons of copper cathode, 60,000 tons of oxygen-free copper rod, 350,000 tons of stainless steel continuous casting base and 350,000 tons of stainless belt material.
(4) Core competitiveness of product line of technological process
The company's production line is using a leading craftwork in China and an advanced equipment in the world. The overall design of steelmaking and continuous Casting Engineering is designed by China Metallurgical Group Beijing Iron and Steel Research and Design Institute, and the stainless steel pipe, steel belt and round steel are designed by Shanghai Wugang Industrial Design Institute .
In the production section of the recycling of copper belt, condensed copper pipe, high quality rod and wire material, the project company will based on the production technology at home and aboard, introduce advanced technology and equipment(analysis and test the testing equipment, argon casting and liquid control system) from European countries and America, it has adapts a serial of advanced, professional, complete and systematic craftwork while smelting, continuous casting, tandem rolling and forging the products, a high productivity and quality is secured, and it saves energy and protect the environment.
Because of its main products has high quality， products of various economic indicators also stays in line with similar international products. Its revenue, market share increases year by year.
(5)Profit level
The project has a stable profitability and it keep improving.The sales profit ratio of 2010 and 2011 were recorded as 12.49% and 13.11% respectfully.
(6) Type of investment: Strategic investment.
(7) Usage of funds:
An investment of RMB980 million is planned to use for an expansion of 300,000 tons of high-quality stainless steel made wire and rod material project
Invest RMB1.372 billion on the construction of a project with an annual output of 50,000 tons of copper belt and 20,000 tons of condenser pipe.
Fully use of recycling metal and the advantage of processing to expand indutrial chain, improve the comprehensive power and competitive ability of the company, formulate a comprehensive utilization production system from raw material to the completion of renewable metal.
To complete the transmormation of renewable metal process to high-tech renewable metal and the comprehensive utilization of renewable high quality copper. Renewable stainless made products are used in more and more places, it can be estimated that the sales revenue and profit will be RMB25.7 billion and RMB2.9 billion respectfully in 2014.
