Shanghai Securities News | STAR Market Sees Outstanding Third Quarter Reports Hard and Core Technology Continues to Release Momentum and Vitality
Source: Shanghai Securities News
On the evening of October 16, 2022, Zhuzhou CRRC Times Electric Co., Ltd., Beijing Tieke Shougang Railway-Tech Co., Ltd. and Hunan Changyuan Lico Co., Ltd. took the lead to disclose their outstanding performance in the first three quarters of 2022 as STAR Market companies, reporting growth of 29.97%, 82.54% and 128.66% year on year, respectively, in terms of net profit attributable to the parent company. In addition, 37 STAR Market companies predict their good performance in the first three quarters, of which, 16 companies are expected to double their net profit attributable to the parent company year on year, 31 companies are expected to increase their net profit by more than 50% year on year, and one unprofitable listed company is expected to turn losses into profits.
Focusing on hard and core technology enterprises and pursuing steady progress. On the whole, the companies on the STAR Market maintain strong growth momentum and continuously increase their investment in R&D and expanding production, continuing to release the momentum and vitality brought by scientific and technological innovation.
Steady Development of "the Pillars of a Great Power"
Among the first batch of the reporting companies, Zhuzhou CRRC Times Electric Co., Ltd. and Beijing Tieke Shougang Railway-Tech Co., Ltd. are both "key national enterprises" in the field of rail transit in China, seeing a steady performance in the first three quarters based on their core technical advantages in key areas.
As a leading traction converter system supplier in China, Zhuzhou CRRC Times Electric Co., Ltd. realized an operating income of 10.876 billion yuan and a net profit attributable to the parent company at 1.563 billion yuan in the first three quarters, a year-on-year increase of 27.56% and 29.97%, respectively. While consolidating the advantages of its main business in rail transit, the Company, benefiting from the national policy of "carbon peaking and carbon neutrality", achieved rapid development in the fields of new energy vehicle electric drive systems, photovoltaic inverters, semiconductor devices and sensors, forming a new profit growth point. During the reporting period, the Company reported a significant growth of 136.98% in emerging equipment product revenue compared to that of the same period last year.
Zhuzhou CRRC Times Electric Co., Ltd. previously disclosed its plan of investing 11.119 billion yuan in the industrialization construction project of medium and low voltage power devices to expand the production capacity of 8-inch medium and low voltage component substrates. After completion, the project will form a complete industrial production chain of component products with the Company's existing production base, and constitute a large-scale industrial production base of power electronic products, covering high-voltage, medium and low-voltage chips and modules.
Beijing Tieke Shougang Railway-Tech Co., Ltd., with equally outstanding performance, is a subsidiary of China Railway and the only fastener system integrator that has mastered special adjustment technology for high-speed rail fasteners in China. The Company realized an operating income of 1,011 million yuan and a net profit attributable to the parent company at 191 million yuan in the first three quarters, a year-on-year increase of 24.12% and 82.54%, respectively. The Company attributes this to the large-scale construction of high-speed railways in China, which ensures the new market demand for high-speed rail fasteners. In addition, with the increase of the service life of existing high-speed railways year by year, the maintenance and replacement demand for high-speed rail fasteners will gradually increase in the future.
Looking into the future, Beijing Tieke Shougang Railway-Tech Co., Ltd. has set its eyes on the R&D and market expansion of a new generation of high-speed rail fasteners, and vibration-damping products for urban rail and subway tracks, relying on major railway projects to carry out technological innovation in key areas to help achieve self-reliance in technology.
Both Production and Sales Boom in New Energy Market
The prosperity of the new energy vehicle industry has led to a boom in both production and sales of batteries in the upstream. Hunan Changyuan Lico Co., Ltd., the leading provider of battery cathode materials, realized an operating income of 12.696 billion yuan and a net profit attributable to the parent company at 1.114 billion yuan in its report for the first three quarters, a year-on-year increase of 179.87% (nearly doubled as the whole of last year) and 128.66%, respectively. On the one hand, the demand of the downstream customers for the Company's products grows rapidly; on the other hand, the Company's 40,000-ton/year automotive lithium battery cathode materials expansion project has realized a full-load operation, and some production lines of the second phase of the project have been completed and conducted the trial operation. Moreover, the Company moves smoothly in the research and development of new products. Two ultra-high nickel 9 series NCA and NCM products have been certified by its customer and realized 100 tons of delivery, respectively, improving its profitability further.
Guizhou Zhenhua E-chem Inc. also performs well in this track. The Company predicts its net profit attributable to its parent company will be 980 million yuan to 1,020 million yuan in the first three quarters of 2022, an increase of 276.16% to 291.51% year on year. The high prosperity of the whole new energy industry promotes strong customer demand. The Company has sufficient orders in hand and sees a great increase of income in the ternary cathode material business. In addition to the optimized product structure, appropriate procurement strategy, and the advantages of production resources in the western region, the Company improves its profitability.
Under the guidance of the "carbon peaking and carbon neutrality" policy, many photovoltaic, wind energy and other new energy enterprises on the STAR Market have been promoting their R&D and production after listing, to "accumulate energy" for development. For example, Trina Solar Co., Ltd., engaged in photovoltaic modules, disclosed in the early stage that it plans to build production lines with annual output of 300,000 tons of industrial silicon, 150,000 tons of high-purity polysilicon, 35GW single crystal silicon, 10GW sliced silicon, 10GW batteries, 10GW modules and 15GW module auxiliary materials in Xining.
For another example, Qingdao Gaoce Technology Co., Ltd., a silicon wafer cutting equipment provider, has realized profit in that current year after completing the construction of the "Photovoltaic Large Silicon Wafer R & D Center and Intelligent Manufacturing Demonstration Base Project", "Leshan 20GW Photovoltaic Large Silicon Wafer and Supporting Project (Phase I, 6GW)" and "Jianhu (Phase I) 10GW Photovoltaic Large Silicon Wafer Project". At present, the Company has realized the total scale of silicon wafer cutting and processing services up to 21GW.
Hard and core technology favored by institutions
With steady performance growth, development resilience and long-term investment value, the companies on the STAR Market have also attracted the attention of institutional investors, as shown by the changes of shareholders' list of the first batch of reporting companies in the first three quarters.
The latest shareholders' list of Zhuzhou CRRC Times Electric Co., Ltd. shows that China Merchants Bank Co., Ltd.-Galaxy Innovation Growth Hybrid Securities Investment Fund, China Merchants Bank Co., Ltd.-Huaxia SSE STAR Market 50 Component Trading Open-end Index Securities Investment Fund hold more of its shares in the third quarter. Hong Kong Securities Clearing Company Ltd. increases its shareholding by 14.23 million shares in the third quarter and becomes the Company's fourth largest shareholder with a 1.4% shareholding.
Beijing Tieke Shougang Railway-Tech Co., Ltd. also attracts the old international investment company, UBS AG. UBS AG bought 490,000 shares in the third quarter of this year, making it one of the top ten shareholders of Beijing Tieke Shougang Railway-Tech Co., Ltd. for the first time. Natural person Wu Di entered the top ten for the first time in the third quarter, too, and becomes the ninth largest shareholder of the Company. Li Hanfa and Lu Shengrun, always in the top ten, chose to continue to increase their holdings to 2,698,100 shares and 320,900 shares, respectively.
Institutions' preference for hard and core technology is reflected not only in the shareholders' list, but also in the survey notes. According to the latest investor relations activity records released by Zhongfu Shenying Carbon Fiber Co., Ltd., more than 100 institutions, including Hillhouse Capital Group and Springs Capital surveyed the Company in September, and conducted in-depth exchanges on the Company's carbon fiber application areas, technological development directions, and capacity expansion.
The journalist found that up to now, in addition to the three companies that have officially disclosed their performances in the first three quarters, another 37 companies on the STAR Market have announced the "good news" of their operation in the first three quarters of 2022 through prospectus, performance forecast, preliminary earnings estimate and business information announcement. Shenzhen Hymson Laser Intelligent Equipments Co., Ltd., Hygon Information Technology Co., Ltd., MGI Tech Co., Ltd., Hubei WanRun New Energy Technology Co., Ltd. are expected to increase their net profit by more than three times, and National Silicon Industry Group Co., Ltd., as an unprofitable listed company, is expected to turn losses into profits.