Recently, the China Association of Automobile Manufacturers announced the 2010 China automobile production and sales data, which were 18.26 million and 18.06 million, respectively, which set a new record. The hot auto market has also increased the income of many auto parts companies. In 2010, many parts and components companies not only hit new highs in sales volume, but also moved frequently in the capital market, and there was a phenomenon of intensive listing.
Auto parts companies get listed
Looking back at the development of China's parts and components companies, there is not yet a year like 2010, and many companies have come up with listings. Through the IPO (initial public offering) listing financing, or through the issuance of new shares financing, parts and components companies staged a capital market grab in mind in 2010.
On February 9, 2010, Xingmin Steel was listed and traded on the SME board. Through IPO, the company raised 706 million yuan of funds. Shortly thereafter, Longji Machinery, which manufactures automotive brake hubs and brake pads, was also listed on the SME Board of the Shenzhen Stock Exchange and raised 509 million yuan. This ignited the flames of competition for parts and components companies in 2010. Over the next few months, more than ten companies such as Wanliyang, Zhongyuan Inner Match and Songzhi Co., Ltd. were listed. On December 7, 2010, Jiangsu Lida successfully listed and successfully raised 950 million yuan, but this did not end the listing of parts and components companies in 2010. At the end of 2010, Highly Meida and Asia Pacific Technology, which operates the auto parts business, began to purchase online and prepare for listing.
According to statistics, in 2010 there were 12 auto parts companies financing through the domestic capital market, financing amounted to 11.18 billion yuan. In addition, there are two more recently-listed parts and components companies. Among the parts and components companies that were listed in 2010, except for Lifan and Hangfang, which are listed on the main board of the Shanghai Stock Exchange, the rest of the companies are listed on the Shenzhen Stock Exchange SME Board or GEM.
Traditional parts companies are active
Among the IPO component companies in 2010, most of the company's main businesses were in the traditional component industry category. Traditional component companies have taken a big step in expanding their financing channels.
The main businesses of Xingmin Steel Ring and Jingu Group are R&D, production and sales of steel wheels. Double-ring transmission and advance of Hangzhou Gear are mainly engaged in the production of automotive transmission gear products. Longji Machinery produces and sells brake wheels. Brake discs and brake pads and other auto parts products; Songzhi Stocks's main business is automotive air-conditioning; Jiangsu Yanda is mainly engaged in car seat fabrics and other interior fabrics.
Among them, there are two companies engaged in the development and production of key component assemblies. One is Wan Liyang. The company mainly produces and operates automotive transmissions. The second is Lifan shares, not only the productivity of Sailor car, but also R & D, productivity and sail brand car, motorcycle engine, and more importantly, Lifan shares in the development, production and sales of electric vehicles also achieved certain results.
Among the newly listed auto parts companies in 2010, there are not many companies related to new energy vehicles. The main reason is that as new energy vehicles and related parts and components are still in the industrial cultivation process, the scale of production and sales is still too small. The scale of new energy auto parts companies is also small, and they do not have the conditions for listing. On the other hand, traditional auto parts companies have made quite a lot of spare parts companies due to blowouts in the Chinese auto market in the past two years. Parts companies are pursuing bulging. While improving traditional technology, considering more is how to achieve more long-term development. Listing is a good path. Listing provides companies with a broad arena, enabling them to develop new products and inject vitality into the company.
Listed private companies want to become bigger and stronger
It is worth noting that the newly listed auto parts companies in 2010 were all private enterprises. These privately-owned small and medium-sized parts and components companies have learned to use the capital market to expand their financing channels, and the previous financing difficulties have been greatly eased.
Many people think of the phenomenon of “scattered, chaotic, and bad†when it comes to private parts and components companies. There are a large number of private parts and components companies, especially small and medium-sized parts and components companies, which have fierce competition and poor living conditions. However, among the private parts and components enterprises, there are also some enterprises with advanced technology, strong strength, and high development potential. Coupled with the flexibility of private enterprises, some private enterprises have developed rapidly and their scale has continued to expand. Especially in recent years, the development of the parts and components industry has received more and more attention, and the national policy has begun to encourage large-scale and powerful parts and components companies to merge and reorganize to become bigger and stronger. Under such circumstances, some capable private enterprises began to look for rapid development. Listing financing has become a common choice.
The person in charge of a vehicle spring production company in Hunan introduced the plan to achieve the market in 2011. Through listing, it can enhance the strength of the company, be invincible in the fierce competition, and be able to prepare funds for the research and development of new products with high technology content. In addition to financing, in the pre-listing preparation work, parts and components companies can learn a lot of modern enterprise management knowledge, not only have the power to improve the technical level, but also greatly improve the corporate governance structure and financial management.
Using Capital Leverage to Inspire Big Markets
The former small and medium-sized private parts and components companies seem to represent the vulnerable groups in the market. Many companies are quite emotional when they talk about the financing difficulties of the past. These companies have always wanted to grow and develop. The vast majority of their funds are derived from their own capital. Many companies use bank loans to indirectly finance their financing. This is often because banks do not have large-scale operations and large operational risks. Moreover, at the time, there weren't many parts and components companies listed on the domestic capital market, and companies did not seem to be keen on this method of direct financing of listing.
However, with the rapid development of the capital market in recent years, more and more parts and components companies have gradually realized the benefits of direct financing, and listing has become a mouthpiece of many corporate decision makers. These small and medium-sized private enterprises have been reluctant to do the weak in the market, but chose to take the road of modern enterprises. They realized that capital operation can help companies break the financing bottleneck, obtain long-term stable capital, improve their capital structure, and obtain more funds for R&D, effectively enhancing their innovative capabilities.
At the same time, more and more parts and components companies are aware that the current market competition has become brand competition. In the past, the simple method of winning market share by relying on cheap labor and low-tech products has been unable to continue. In addition to product and technology competition, brand competition also includes goodwill and service competition. Listing also becomes one of the ways that these companies demonstrate their strength and enhance their brand value. Capital operation can not only bring capital, but also bring higher brand value, which has also become the reason why many parts and components companies seek to go public. They want to use capital leverage to shake the market during the booming development of China's auto industry and become the strongest.
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