Impact on “A+H” listings, Ningde era has a strong overseas layout

Photo source: Visual China

Blue Whale News, February 12 (Reporter Wang Xiaonan)Seven years after the A-share listing, Ningde Times (300750.SZ) with a market value of one trillion yuan rushed to Hong Kong stocks.

On February 11, Ningde Times New Energy Technology Co., Ltd.(hereinafter referred to as Ningde Times) officially submitted an application to the Hong Kong Stock Exchange to issue overseas listed foreign shares (H shares) and list them on the main board of the Hong Kong Stock Exchange. Sponsors include Bank of America, China International Capital, JPMorgan Chase, Goldman Sachs, UBS, etc. It has only been about one and a half months since Ningde Times disclosed the news of listing in Hong Kong on December 27 last year.

In order to further promote the company’s global strategic layout, overseas production capacity expansion is the focus of this Ningde Times listing in Hong Kong. The funds raised are planned to be used to promote the construction of the first and second phases of the Hungarian battery factory. In fact, there was no shortage of money in the Ningde era. In the first three quarters of last year, bank balances, deposits and cash were 259.8 billion yuan.

On February 12, Ningde Times closed at 255.3 yuan/share, an increase of 1.39%, with a total market value of 1.12 trillion yuan.

Promoting Hong Kong stock IPOs, Ning Wang strongly deploys overseas markets

The prospectus shows that Ningde Times was founded in 2011 by a founding team represented by Zeng Yuqun. Currently, Zeng Yuqun serves as chairman, executive director and general manager of the company. In June 2018, Ningde Times was listed on the GEM of the Shenzhen Stock Exchange.

As of September 30, 2024, Zeng Yuqun’s Xiamen Ruiting Investment Co., Ltd. holds 23.28% of Ningde Times, Hong Kong Securities Clearing Co., Ltd. holds 11.45% of the company, and Huang Shilin holds 10.59%.

At present, Ningde Times is mainly engaged in the research and development, production and sales of power batteries and energy storage batteries to promote mobile fossil energy substitution and fixed fossil energy substitution, and achieve integrated innovation in market applications through electrification and intelligence.

As of the first three quarters of 2024, Ningde Times ‘power battery system business achieved revenue of 17.55 billion yuan, accounting for 67.8% of the total revenue, making it the company’s main source of income; energy storage battery system business revenue was 4.64 billion yuan, accounting for 17.9%; battery materials and recycling business revenue was 1.88 billion yuan, accounting for 7.3%.

According to the industry report of the High-tech Industrial Research Institute, the use of power batteries in Ningde Times has ranked first in the global market share for eight consecutive years since 2017, and the global market share from January to November 2024 is 36.8%; Energy storage battery shipments Since 2021, the global market share has ranked first for three consecutive years, and the global market share will be 40% in 2023.

At present, the customers of Ningde Times power batteries are mainly domestic and foreign automobile companies, including BMW, Mercedes-Benz, Stellantis, Toyota, SAIC, NIO, Ideal, Xiaomi, etc.; while the customers and partners of energy storage batteries are mainly energy storage system integrators, energy storage project developers or operators, mainly including NextEra, Synergy, National Energy Group, China Huaneng, PetroChina, etc.

China has always been the focus of development in the Ningde era. In 2022, 2023 and the first nine months of 2024, the proportion of income from within China will account for more than 60%. With the continuous expansion of its global layout, Ningde Times ‘overseas revenue is also growing. During the same period, Ningde Times’ overseas sales revenue was 76.9 billion yuan, 131 billion yuan and 80.1 billion yuan respectively, accounting for 23.4%, 32.7% and 30.9% of the total revenue respectively.

As of September 30, 2024, Ningde Times has 13 battery production bases around the world. In addition to China, Ningde Times has built a battery production base in Thuringia, Germany. The company is promoting the construction or preparation of the Hungarian factory, the Spanish factory jointly invested by Stellantis N.V., and the Indonesian battery industry chain project.

In 2022, Ningde Times plans to build a power battery system production line with an annual output of 100GWh at the Debrecen base in Hungary in phases. The total investment amount is expected to not exceed 7.34 billion euros, and the total construction period is expected to not exceed 64 months. At present, the project has completed preliminary preparations and project construction has started. As of the end of 2024, Ningde Times has invested approximately 700 million euros, while the total investment in the first and second phases of the Hungarian project is approximately 4.9 billion euros, and the remaining funds will be invested one after another in the future.

Seven years after landing on the GEM, Ningde Times chose to go to Hong Kong for a secondary listing. The reason behind this may also be related to the expansion of overseas production capacity. As of the first half of 2024, the foreign currency balances of US dollars and euros in Ningde era were US$6.735 billion (approximately 49.2 billion yuan) and 3.858 billion euros (approximately 29.2 billion yuan) respectively.

Last year’s revenue was forecast to be reduced, seeking overseas expansion

Affected by the hot development of new energy, the Ningde era developed rapidly.

The high-tech industry report shows that the global market demand for new energy vehicles continues to grow, with sales increasing from 3.2 million in 2020 to 17.5 million in 2024. Especially since 2020, new energy vehicles have entered a period of explosive growth. Due to the high demand for power batteries, the threshold of the Ningde era has been broken by car companies for a time.

This period is also a time when Ningde’s performance takes off. After the company’s revenue increased from 867 million yuan in 2014 to 45.788 billion yuan in 2019, its revenue soared from 50.319 billion yuan in 2020 to 400.917 billion yuan in 2023. During the same period, Ningde’s net profit attributable to the parent company also climbed from 62.43 million yuan in 2014 to 44.121 billion yuan in 2024.

In the process, the market value of Ningde era has also risen. Ningde Times, which entered the GEM at an issue price of 25.14 yuan/share, has continued to rise since June 11, 2018. On May 31, 2021, Ningde Times’s share price closed at 434.1 yuan/share, and its market value exceeded one trillion yuan in one fell swoop. It also became the first company on the GEM with a market value of more than one trillion yuan.

On the evening of January 21, Ningde Times disclosed its 2024 results forecast. It expects revenue in 2024 to be 356 billion yuan to 366 billion yuan, a year-on-year decrease of 8.71%-11.2%; net profit attributable to the parent company will be 49 billion yuan to 53 billion yuan, a year-on-year increase of 11.06%-20.12%.

Ningde Times said that although sales of the company’s battery products increased, due to the decline in the prices of raw materials such as lithium carbonate, the company’s product prices were adjusted accordingly, resulting in a year-on-year decline in operating income.

Ningde Times was not short of money before going public in Hong Kong. As of September 30, 2024, Ningde Times Bank’s balance, deposits and cash were 259.8 billion yuan, while its borrowings were only 31.159 billion yuan. Since its listing in 2018, the company’s cumulative dividends have reached 36.561 billion yuan.

In June 2018, Ningde Times IPO raised net funds of 5.35 billion yuan, which were used for the Ningde Times Huxi Lithium-ion Power Battery Production Base Project and the Ningde Times Power and Energy Storage Battery Research and Development Project respectively. In February 2020, Ningde Times passed a fixed increase and raised net funds of 19.62 billion yuan for the expansion of Ningde Times Huxi lithium-ion batteries, Jiangsu Times Power and Energy Storage Lithium-ion Battery R & D and Production Project (Phase III), and Sichuan Times Power Battery Project Phase I and other projects.

Two years later, in July 2022, Ningde Times raised net funds of 44.87 billion yuan through fixed increase to be used for the Fuding Times Lithium-ion Battery Production Base Project, the first phase of Guangdong Ruiqing Times Lithium-ion Battery Production Project, and Jiangsu Times Power and Energy Storage Lithium-ion Battery R & D and Production Project (Phase 4) and other projects.

This time, Ningde Times went public in Hong Kong, and the raised investment funds will be used to promote the construction of the first and second phases of the Hungarian battery factory and supplement working capital. It is also the first time that the company has used the raised funds to expand overseas production capacity.