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58.2 billion daily volume increase shocked the market!Three questionsNingde era
Reporter | U Dan Ruo
Edit | Yang Cheng
On the evening of August 12, the world’s leading lithium battery company Ningde Times (300750.SZ) threw out a fixed increase plan of 58.2 billion yuan, shocking the market.
Why are you shocked? To what extent does this 58.2 billion yuan increase?The Red Star Capital Bureau combed and found that it surpassed CATL’s operating income of 50.3 billion yuan in 2020, and also exceededChina TelecomOf IPO funds raised. If the issuance is successful, this fixed increase amount will become the third in the list of fixed increase financing in the history of A-shares and the first among private enterprises. In addition, of the more than 4,400 A-share listed companies, only 265 companies have a market value of more than 58.2 billion yuan.
The Red Star Capital Bureau learned that after the announcement of the fixed increase plan,Industrial SecuritiesThe conference call held overnight was crowded with 2,000 investors. CICC,CITIC Securities, Guosheng Securities,GF SecuritiesMany brokerage companies quickly released research reports, optimistic about the Ningde era to consolidate the industry’s leading position and promote the accelerated development of the energy storage battery industry.
However, this huge increase has many questions to be solved, including the necessity of fixed increase, whether the amount of funds raised is too high, and whether high-priced additional issuance will affect the market.
In the early trading of August 13, CATL opened 4.38% lower, rose more than 5% after turning into the red, and fell back. It closed at 502.05 yuan per share, a slight increase of 0.01%, and the total market value was 116.928 billion yuan.
Question 1:
Holding 70 billion in cash, 6.8 billion left in the last fundraising
Is it necessary to increase
The Red Star Capital Bureau learned that the Ningde era’s nearly 20 billion yuan of funds raised last year has not yet been used up, and there is still a lot of money left on the account. Half a month ago, it also used idle funds to invest in wealth management products.
On the evening of February 26, 2020, CATL successively announced fixed increase plans and investment announcements, involving a total amount of about 30 billion yuan. Among them, the planned increase in cash will not exceed 20 billion yuan, and the company will raise another 10 billion yuan. The funds raised will be used for 5 battery expansion projects: Ningde Times Hubei Lithium-ion Battery Expansion Project, Jiangsu Times Power and Energy Storage Lithium-ion Battery R&D and Production Project (Phase 3), Sichuan Times Power Battery Project Phase I, Electrochemical Storage It can reserve R&D projects for cutting-edge technology and supplement working capital of 5.5 billion yuan.
Ningde era was not short of money. In September 2019, CATL was approved by the China Securities Regulatory Commission to issue corporate bonds with a face value of no more than 10 billion yuan to qualified investors. As of the end of 2019, there are still 962 million yuan of funds raised in the previous fundraising that have not been used. As of the end of the third quarter of 2019, Ningde Times had 33.352 billion yuan in monetary funds, but the total amount of accounts payable and notes payable was 28.134 billion yuan.
In July 2020, CATL’s fixed increase of nearly 20 billion yuan was announced. In the end, 9 institutions stood out from more than 30 investors to obtain a share of the placement.
The money has not been used up yet. According to the company’s announcement, as of June 30 this year, the unused funds raised were as high as 6.8 billion yuan.
As of March 31 this year, Ningde Times had a total of 71.677 billion yuan in monetary funds on its accounts. The total amount of accounts payable and bills payable is as high as 41.191 billion yuan.
It is worth mentioning that on July 20, CATL announced that it agreed to use no more than 5.5 billion yuan of idle raised funds to invest in wealth management products.
In this regard, Ningde Times stated that 70% of the 20 billion financing has been used, and the funds on the account have been arranged for specific uses. This financing is mainly for long-term planning. It will be too late if we wait until 2022 to expand production capacity. NS.
The company is concerned about blade batteries, hydrogen energy and other new energy and new technology fields, and has a certain degree of technical application. It has reserves in many technical fields. There is no technology replacement for hydrogen energy and lithium batteries as new energy plans.
According to the “Assurance Report on the Use of Previous Funds Raised by Ningde Times”, as of June 30, the previous raised funds amounted to 19,177,711,300 yuan, the actual use of 13,179,964,400 yuan, and the unused raised funds of 679299764 yuan (including the amount after deduction of handling fees) Interest income 357,440,900 yuan). The unused raised funds accounted for 34.63%, because the investment project is still under construction and part of the funds has not been paid. The company will effectively guarantee the reasonable use of the remaining funds raised in accordance with the investment status of the fund-raising commitments.
Question two:
58.2 billion over last year’s total revenue
Is the fixed increase amount reasonable?
The fixed increase plan shows that Ningde Times intends to increase no more than 10% of the company’s total equity before the issuance (that is, no more than 233 million shares) to no more than 35 specific objects. The total amount of raised funds is no more than 58.2 billion yuan. Items.
The one-time fixed increase in financing is 58.2 billion yuan, which has surpassed CATL’s operating income of 50.3 billion yuan in 2020, and exceeded China Telecom’s IPO proceeds. If the issuance is successful, this fixed increase will rank third in the A-share history of fixed increase financing, and the first private enterprise. Currently, among the more than 4,400 A-share listed companies, only 265 companies have a market value of more than 58.2 billion yuan.
How is this amount determined? Is it too high?
In response, Ningde Times responded that fixed increase is a long-term strategic plan for the company as a whole, and a part of the capital needs to be matched. According to regulatory requirements, the fixed increase can reach up to 30%, and this time 58.2 billion accounted for less than 6% of the market value.
Industry insiders told the Red Star Capital Bureau that according to the new 2020 refinancing regulations, the number of non-public shares to be issued shall not exceed 20% of the total share capital before the issuance to 30%.
The issuance price shall be changed from a 10% discount to a 20% discount to the average price of the company’s stock in the 20 trading days prior to the pricing base date.
“The lithium battery sector is expanding production one after another. CATL will increase its production capacity at a rapid rate this time, which will help bring the scale effect to play, reduce battery costs, and enhance the company’s industry competitiveness.”
CITIC Securities believes that CATL has set a plan of 58.2 billion yuan for the expansion of power and energy storage battery production capacity. CATL is expected to exceed 200/600GWh by the end of 2022/2025, pushing the industry into the THh era.
The fundraising projects of CATL include the Fuding Times lithium-ion battery production base project (newly increased annual production capacity of lithium-ion batteries by approximately 60GWh), and Guangdong Ruiqing Times lithium-ion battery production project phase I (newly increased annual production capacity of lithium-ion batteries by approximately 30GWh ), Ningde era new energy advanced technology research and development and application projects (development of key material systems for a new generation of power and energy storage batteries, development of key materials and equipment in the sodium-ion battery industry chain, etc.) and supplementary working capital.
The total investment of the Fuding Times lithium-ion battery production base project alone exceeds 18.3 billion yuan, and 15.2 billion yuan of raised funds are planned to be used; the total investment of the first phase of the Guangdong Ruiqing Times lithium-ion battery production project is also as high as 12 billion yuan, which is planned to be used 11.7 billion yuan was raised.
In terms of energy storage, this time it is planned to use the raised funds of 6.5 billion yuan to invest in the Jiangsu Times Power and Energy Storage Li-ion Battery R&D and production project (Phase IV). The total investment in the project exceeds 11.6 billion yuan.
In addition to major projects such as lithium batteries, the investment amount used to supplement working capital is as high as 9.3 billion yuan.
Question three:
35 specific objects, additional issuance at the highest share price
Will it affect the secondary market?
CATL’s issuance targets 35 securities investment fund management companies, securities companies, trust investment companies, financial companies, insurance institutional investors, qualified foreign institutional investors, and other domestic and foreign institutional investors that meet the subscription conditions prescribed by the laws and regulations in effect at that time. Legal investors such as investors and natural persons.
According to the non-public issuance system, the lock-up period for controlling shareholders, actual controllers and the enterprises controlled by them is 18 months; the lock-up period for other investors is 6 months.
Some stockholders are worried that after six months of the expiration of the sales restriction, a huge amount of sales will be lifted, and the secondary market will eventually have to take over, resulting in a huge blood draw effect.
In addition, the timing of the fixed increase of CATL is just at the node with the highest stock price.
Since the beginning of November 2019, CATL’s stock price has risen by as much as 632%, and its market value has increased by more than 1 trillion yuan, ranking first in the market value of the ChiNext for a long time. Since the beginning of this year, the Ningde era has set a record high. The founder Zeng Yuqun’s net worth has also risen, and he has won the Forbes Hong Kong rich list. The latest stock price of CATL is 502.05 yuan per share, with a total market value of 1.17 trillion yuan.
Some shareholders believe that high-priced additional issuance financing is not friendly to shareholders in the secondary market.
In this regard, CATL said that the fixed increase is for no more than 35 specific targets, and there is no impact that everyone thinks will have an impact on the market.
Last year’s fixed increase of nearly 20 billion yuan, Hillhouse Group subscribed 10.6 billion yuan, Honda subscribed 3.7 billion yuan, Taiping Asset Management 1.2 billion yuan, UBS 1.1 billion yuan, Beixin Ruifeng 880 million yuan, and JP Morgan Chase Securities 770 million yuan ,Guotai Junan750 million yuan, 700 million yuan for JPMorgan Chase Group.
On February 4 this year, CATL ushered in the lifting of 122 million shares, and the 11 shareholders included the above-mentioned fixed increase targets. On the 20th day before the ban was lifted, CATL fell 6.34%; on the 20th day after the ban was lifted, it fell 17.34%.
However, on June 11, CATL’s 952 million shares were lifted from the ban, all of which were the initial shares restricted by the original shareholders. The same is a huge amount of lifting of the ban. When the number is 7.8 times that of the previous batch, the impact on the stock price is completely different. On the 20th day before the lifting of the ban, CATL rose by 23.79%; on the 20th day after the lifting of the ban, it rose by 25.65%.
During this period, CATL did not announce a major shareholder reduction.
Some analysts believe that the massive lifting of the ban has not affected the stock price, mainly due to the high prosperity of the new energy and automobile sectors, which is good for the Ningde era.
Since March, the new energy index (000941) has risen all the way, from about 2500 points to the current 4,123.22 points. Many Internet companies have begun to build cars one after another, traditional car companies have increased their investment in new energy vehicles, and new energy vehicles have become a key development direction. As a leading battery supplier, CATL is favored by institutions.
CICC gave Ningde Times a target price-earnings ratio of 40 times in 2023, corresponding to a target price of 653 yuan; CITIC Securities maintained a target price of 754 yuan per share, far exceeding the current stock price of Ningde Times.
Investment institutions can get rich returns from future stock price increases, and naturally they don’t hesitate to participate in fixed increase.
Take Hillhouse Group, which participated in the previous round of fixed increase, as an example. Hillhouse Group holds 52.795 million shares of Ningde Times stock, with a shareholding ratio of 2.27%. As of the end of the first quarter of this year, Hillhouse Group’s holdings remained unchanged. If the stock is not sold, according to the current stock price, Hillhouse Group’s floating profit will exceed 22 billion yuan, and the floating profit ratio is as high as 211%.
It is worth mentioning that Honda’s subscription is different from several other investment institutions.
In 2019, Honda signed a strategic cooperation agreement with Ningde Times. The fixed increase in shares further strengthened the cooperation with Ningde Times. It is deeply bound with Ningde Times to jointly develop power battery systems.
The final issuance target of this fixed increase has not yet been determined, and it is not ruled out that upstream and downstream enterprises in the industrial chain other than investment institutions participate in the subscription.
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Editor in charge: Yang Hongbu
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