China Zhongji Investment 2022 IPO Project Progress Series (III): Yatong Precision
China Zhongji Investment is a comprehensive investment platform jointly invested and established by well-known private enterprises in Hebei Province, under the support of the CPC Hebei Provincial Committee and the Provincial Government, and under the guidance of the Hebei Provincial Federation of Industry and Commerce. It is managed and operated by experienced investors and industry experts.
Since its establishment in 2016, guided by its founding principles, China Zhongji Investment has consistently sought long-term certainty amidst short-term uncertainty. Guided by a technology-driven philosophy, the company proactively focuses on the future and implements its strategies through flexible yet rigorous systems. For six years, the company has maintained profitability and forged ahead with its partners.
Since 2022, three projects of China Zhongji Investment have already passed the approval process, and several more are undergoing review. Starting today, we will be introducing these excellent projects to share with more people what China Zhongji Investment is doing, and work towards a shared future.
On April 14, 2022, Yantai Yatong Precision Machinery Co., Ltd. (hereinafter referred to as "Yatong Precision" or "the Company") received approval for its initial public offering (IPO) on the Shanghai Stock Exchange's main board.
Today, let's learn about Yatong Precision.
Established in 2002, Yatong Precision is primarily engaged in the research, development, production, sales, and service of automotive parts and mining auxiliary transport equipment. It is a tier-one supplier for China National Heavy Duty Truck Group, SAIC-GM, SAIC Motor, Daimler, BAIC Foton, and Weichai Power, and is one of the companies with a strong competitive advantage in the field of mining auxiliary transport equipment.
Financial Status: Yatong Precision achieved operating revenue of 857.89 million yuan, 1,006.76 million yuan, 1,314.78 million yuan, and 836.86 million yuan in 2018, 2019, 2020, and the first half of 2021, respectively. Net profit during the same periods was 111.10 million yuan, 105.39 million yuan, 192.29 million yuan, and 103.32 million yuan, respectively.
Effective Strategic Implementation and Reasonable Industrial Layout
Seizing the opportunities presented by the rapid development of China's automotive industry, Yatong Precision has quickly grown from a passenger vehicle parts supplier into a core supplier for leading vehicle manufacturers, expanding into the commercial vehicle sector. It is one of the few domestic enterprises capable of large-scale supply of stamping and welding parts for both commercial and passenger vehicles. With over a decade of experience in this field, the company boasts advanced equipment and technology, possessing independent product development and manufacturing capabilities. By strategically establishing a presence in both passenger and commercial vehicle segments, it achieves complementary risk management.
Since 2010, Yatong Precision has continuously invested heavily in the independent research and development of mining auxiliary transport equipment for underground production, opening a new business line. Its explosion-proof diesel concrete mixer trucks and explosion-proof diesel wet concrete spraying trucks have been identified by the China Coal Machinery Industry Association as domestically pioneering, reaching internationally advanced technological levels and achieving a breakthrough in the localization of key equipment. With product launches, markets have gradually opened and experienced rapid growth.
Industrial Policy Support and Expanding Market Space
According to China's medium- and long-term development plan for the automotive industry, China currently has a solid foundation and favorable conditions for building a strong automotive industry. The current tasks are to strengthen basic capabilities, integrate the industrial chain system, and consolidate the supporting parts system. To this end, relevant national departments have introduced a series of support policies to vigorously support and encourage the development of the automotive industry and the supporting automotive parts industry.
From the perspective of the automotive consumer market, China is still in the period of popularizing car ownership, with relatively low car ownership and significant market growth potential. China's per capita car ownership is not only lower than that of major developed countries such as the United States, Japan, and Germany, but also far lower than that of countries such as Russia and Brazil. With the continuous improvement of economic conditions, roads, and energy, automotive consumer demand will maintain growth, thus driving the continued development of the automotive industry and boosting demand for automotive parts. The domestic automotive parts market still has broad prospects.
High-Quality and Stable Customers and Wide Acclaim for Strength
As a Tier-1 supplier, the company has been deeply cooperating with SAIC-GM, China National Heavy Duty Truck Group, SAIC Passenger Vehicle, SAIC Commercial Vehicle, Daimler, BAIC Foton, and Weichai Power for over ten years, maintaining high customer loyalty. The development cycle of automotive stamping and welding parts is relatively long, proceeding in sync with the development of whole vehicles. Considering production and time costs, the cooperation between vehicle manufacturers and stamping parts enterprises is relatively stable. With its advanced technologies, excellent product quality, stable supply capabilities, and strong operating strength, Yatong Precision has continuously earned customer recognition, receiving awards such as "Excellent Supplier" (2018 and 2019) and "Gold Supplier" (2020) from China National Heavy Duty Truck Group, and "Excellent Supplier of 2018" from SAIC-GM.
The company's independently developed explosion-proof special vehicles for mining have filled a domestic gap and addressed industry pain points, receiving widespread welcome from major coal mine customers. Major customers include state-owned energy groups, Jineng Holding Group, Shaanxi Coal Industry, and other coal-producing enterprises, as well as Shandong Gold and other metal mining enterprises.
In 2019, China Zhongji Investment participated in Yatong Precision's Pre-IPO round of investment. The project team believes that driven by trends in new energy, electrification, intelligence, and networking, China's automotive industry is entering a new era of industrial transformation, with the industrial landscape undergoing disruption and reshaping, creating numerous investment opportunities. China Zhongji Investment has cultivated a deep understanding of the automotive industry. The company invests in companies with strong innovation capabilities, rapid growth, and significant development potential along the automotive industry chain. Through investment, the company empowers the high-quality and intelligent development of China's automotive industry and looks forward to further cooperation with more high-quality resources in the industry, working together to promote a new transformation of China's automotive industry.
