The Acquisition Of Nylon New Shares And Increase Of 40 Million Of Shenma Shares, To Achieve Sales Revenue Of 364 Million!

Shenma industrial Limited by Share Ltd (hereinafter referred to as "Shenma shares") announced today (January 4th) that the company intends to acquire the 100% stake in Henan Shenma nylon New Material Co., Ltd. (referred to as "nylon new material company"), and intends to increase its capital by 40 million yuan for the nylon new material company in cash.

According to the center forward assessment issued by Beijing center equity Appraisal Co., Ltd. (2018) No. 243rd, "all assets and interests appraisal report of shareholders of Shenma nylon New Material Co., Ltd., which is involved in the acquisition of Shenma industrial Limited by Share Ltd" (referred to as the "evaluation report"), in October 31, 2018, the assessment value of the total interests of the shareholders of nylon new material company is 18 million 605 thousand and 300 yuan, compared with the face value of 4 million 209 thousand and 400 yuan, in October 31, 2018, the added value is 14 million 395 thousand and 900 yuan, and the appreciation rate is 342%.

It is understood that the capital increase is mainly used in the construction of nylon new material company - 20 thousand ton / year special nylon chip and nylon injection project.

The project is one of the characteristic pformation projects of nylon new material company, which has a total investment of 66 million 734 thousand yuan, including 50 million 219 thousand yuan in construction investment, 16 million 515 thousand yuan in the bottom floor, 12 months in construction period, 364 million yuan in product sales income in the year, 3.90 years in the investment recovery period (before income tax), and 4.91 years in the investment recovery period (after income tax).

The main products of the project are: 12000 tons / year two granulation nylon slices, 10000 tons / year special nylon chips, 3000 tons / year injection products, etc.

The implementation of the project is divided into three phases: phased construction, the first unit 12000 tons / year two granulated nylon slicing, new equipment has arrived, the site is under construction, installation is expected to be completed and commissioned by the end of this year; second units 10000 tons / year special nylon slice, third units 3000 tons / year injection product equipment inspection, technical exchange, bidding documents have been completed.

The one or two and three units of the project were synchronized at the same time, but there was a large gap of funds, and the two or three unit has not yet started construction.

Therefore, the capital increase is mainly used to make up for the shortage of project funds.

PA6&PA66 chips have excellent tolerance, easy modification and wide use.

PA6&PA66 as synthetic fiber material can be widely used in knitwear, tire cord, filter cloth, rope, fish net, etc.

As the raw material of engineering plastics, PA6&PA66 is commonly used in producing high-grade automotive parts, mechanical parts, electronic and electrical appliances, packaging materials with high strength, wear resistance and self lubrication.

Out of section PA6&PA66 slices will be produced in the production of PA6&PA66 chips, and the outer PA6&PA66 tow or twister will be produced in the production of PA6&PA66 precursor.

Using these outer PA6&PA66 slices and the outer PA6&PA66 tow or twisting as raw materials, after screening, the nylon regeneration slices were made after the single screw was connected.

The price of nylon regenerated slicing is basically 6000 yuan (PA66) lower than that of raw sliced chips.

Under the premise of quality assurance, nylon regenerated chips are used as raw materials of modified nylon, that is, the advantages of modified nylon cheap materials are ensured, and the nylon nylon "solid waste" takeaway of nylon industry is realized. The market prospect is very good.

Nylon regeneration chips are closely linked to nylon chips, which complement each other, that is, serve the needs of modified injection molding, and further improve the processing and product differentiation system of nylon city in China.

Shenma shares said that the main raw materials for production of nylon new materials (such as external industrial yarn and extra slice) were purchased in Shenma shares, and the main packaging materials (paper tubes, pallets, etc.) were sold to Shenma shares, and there were related pactions.

The acquisition of shares will help reduce related pactions, eliminate competition among nylon 66 slicing businesses, and make Shenma share production system and supporting facilities more perfect, and the independence of listed companies will further improve.

Deng Sheng, an analyst with CITIC Securities, has said that Shenma shares 150 thousand tons of nylon 66 slice capacity and expanded 40 thousand tons in June 2018. The plan is to add 70 thousand tons of capacity in Haian (30 thousand tons) and Shanghai (40 thousand tons). Yexian County's 40 thousand tons of spinning capacity will greatly enhance the company's performance.

Shanghai's 300 thousand tons of adiponectin project is expected to start construction in 2020 and put into operation in 2023. As the most complete set of nylon industry chain in China, Shenma shares are most likely to become partners, helping to get through the whole industry chain and make good future performance.

Another 51% of nylon chemicals and nylon Technology (Main nylon 6 related products) are expected to be injected into the listed companies. Pingdingshan will vigorously develop nylon industrial city in order to achieve economic pformation. Shenma shares will play a pioneering role in the development of nylon industrial city.

According to the financial report, in the first three quarters of 2018, Shenma shares achieved a business income of 8 billion 641 million yuan, an increase of 8.38% over the same period last year, the net profit attributable to the parent company was 565 million yuan, an increase of 708.49% over the same period last year, and the weighted average return on assets was 20.08%, up 17.28 percentage points over the same period.

The main reason for the sharp rise in the first three quarters of the year is that the price of PA66 chips, PA66 industrial yarn and PA66 cord fabric has increased, especially the price of PA66 chips has increased significantly. However, in the three quarter, some of the prices of products dropped.

Price: in the three quarter of 2018, the average price of PA66 chips was 31197.87 yuan / ton (up 4962.67 yuan / ton, +18.9%); the average price of PA66 industrial yarn was 24780.97 yuan / ton (a decrease of 1072.15 yuan / ton, -4.1%); the average price of PA66 cord fabric was 26877,78 yuan / ton (6204.09 yuan / ton, -18.8%) compared with Q2.

Output: in the three quarter of 2018, Shenma shares produced 102 thousand tons of PA66 chips, 45 thousand and 700 tons of PA66 industrial yarn and 44 thousand and 400 tons of PA66 cord fabrics.

Shenma shares plans to enter the world PA6 production first phalanx within three years. The company aims to reach 400 thousand tons of caprolactam and 200 thousand tons of nylon 6 Slice capacity in 2020.

Analysts believe that if these goals are completed, the performance of the production will bring huge profits.

Become an industrial pillar alongside PA66 industry chain.