Dong Mingzhu's "Iron Wrist" Builder has thrown 80 billion investment in automotive bases

Image Source Vision China

Dong Mingzhu has a dream of making cars. Since his entry into the automobile industry, Dong Mingzhu has been active and has been expanding his new energy map every month. As a latecomer of the transformation, Dong Mingzhu, who is called “Miss Dong” by the private sector, advances Yinlong’s advancement with her iron fist.

On August 8, Zhuhai Yinlong New Energy Co., Ltd. (hereinafter referred to as “Zhuhai Yinlong”) and Luoyang City of Henan Province signed a project cooperation agreement in Zhengzhou. Zhuhai Yinlong will build “Yinlong New Energy (Luoyang) in Luoyang High-tech Zone. Production and Industry Fusion Industrial Park, with a total investment of 15 billion yuan.

So far, together with the upcoming Luoyang area, in less than a year Yinlong has planned to build (or prepare to build) production bases in Zhuhai, Chongqing, Shijiazhuang, Chengdu, Lanzhou, Tianjin and Nanjing, as well as Changsha and Hefei. The two industrial parks preliminarily finalized, together with Yinlong's original Zhuhai, Shijiazhuang and Wu'an production bases, have already established 11 production bases nationwide.

In the eight months after Dong Mingzhu entered Zhuhai Yinlong, he signed seven new energy industrial park projects totaling about 80 billion yuan.

Frequent actions, Yinlong Hao throw 80 billion expansion

After Dong Mingzhu’s shareholding, this company, which had not had much reputation before, has been active.

On January 21st, the Lanzhou Yinlong New Energy Industrial Park project was signed. In the first two phases, a total of 2.5 billion yuan was planned to build a new energy bus production base, which was started in May. On May 4, Guangtong Automobile, a wholly-owned subsidiary of Zhuhai Yinlong, purchased a 2.625 billion yuan electric logistics vehicle from Jiangsu Jiulong Automobile Manufacturing Co., Ltd. In the same month, Yinlong New Energy Nanjing Base, with a total investment of 10 billion yuan, was started in Xushui District with a construction period of 2017 to 2018.

In the second half of the year, Zhuhai Yinlong began a more intensive investment.

In July, the government of Panzhihua City was contracted to build a new energy industrial park with a total investment of at least RMB 5 billion. In the same month, 19.5 billion yuan was invested in the construction of the Zhuhai Yinlong New Energy Industrial Park and the National Headquarters Project. According to the official website of the Nanjing State-owned Assets Supervision and Administration Commission, Zhuhai Yinlong signed a contract with Nanjing Xingong Group and Zhuhai Yinlong planned to acquire Nanjing Bus Manufacturing Plant Co., Ltd. to further improve the industrial chain.

The latest investment of 15 billion yuan is in Luoyang. According to the Luoyang Daily, Zhuhai Yinlong Investment and Construction Industry Park will achieve an annual output of 10,000 pure electric commercial vehicles, an annual output of 5,000 pure electric special vehicles, an annual output of 5,000 new energy sanitation vehicles, and new energy sources. Pickup trucks, pure electric farm machinery and many other new energy models.

Diversified financing, expansion

According to the assets appraisal statement of Zhuhai Yinlong, from 2009 to February 2016, Zhuhai Yinlong completed 7 equity transfer and capital increase. In December 2016, Dalian Wanda Group, CIMC, Dong Mingzhu, Beijing Yanzhao Huijin International Investment Company, Jiangsu Jingdong Boneng Investment Management Co., Ltd. and Zhuhai Yinlong signed a capital increase agreement of 3 billion yuan, and 5 parties were awarded Zhuhai Yinlong 22.39. % of equity. Zhuhai Yinlong’s valuation after the capital increase was RMB 13.4 billion.

In March this year, Zhuhai Yinlong completed the reform of its shareholding system and changed from a "limited liability company" to a "joint company." In May, Zhuhai Yinlong handled the registration and registration of counseling in the Guangdong Securities Regulatory Bureau, and proceeded to the Public Prosecution and entered the Pro-IPO stage. To this end, it also pulled the leader of the National Clean Vehicle Action Coordination Leading Group and Wang Binggang, the special expert of the 863 Program of the Ministry of Science and Technology of the People's Republic of China as an independent director, to increase the number for listing.

In addition to equity financing, Zhuhai Yinlong also has some debt financing. In August, Wei Yincang, chairman of Zhuhai Yinlong, publicly stated that he has obtained support from a number of banks such as China CITIC Bank, including CITIC Bank's comprehensive credit line of 27.6 billion yuan. It is learnt that this amount mainly includes the entire cycle of financing, project loan financing and equity financing of Zhuhai Yinlong. At the same time, it also received credit support from banks such as China Construction Bank, Ping An Bank, Zhejiang Commercial Bank, and Guangzhou Rural Commercial Bank.

In fact, between 2014 and 2015, Zhuhai Yinlong had three A-share listing opportunities and ended up miscarrying with the transfer of shares of Sanyou Chemicals, Zhongyeda and Beiba Media. For Zhuhai Yinlong listed, Cao He, chairman of Zhongrong Venture Capital Management (Beijing) Co., Ltd., bluntly stated that “the current positive factor is that financing from the banking industry will add points to Yinlong’s IPO.”

Betting on Yinlong and optimistic about new energy

Having invested all his own assets, the determination of Dong Mingzhu to make a car is evident. Resolutely resolutely breaking into the back of the new energy automotive industry, Dong Mingzhu is optimistic about the core value of Zhuhai Yinlong, namely its lithium titanate battery technology. Lithium titanate battery is characterized by its fast charge, high safety, long cycle life, and no significant attenuation for up to 30 years. In addition, the temperature is extremely low, and winter won't be "short legs" like a lithium battery. And the resistance of this type of battery is very low. At present, Yinlong has been able to achieve a model that lasts 6 kilometers and is fully cruising for 200 kilometers.

Yinlong Automobile, photo source network

However, the disadvantages are also obvious, with low energy density and insufficient battery life. There is a voice in the industry that lithium titanate batteries are not the mainstream technology for power batteries. The technical characteristics of lithium titanate batteries also determine that Zhuhai Yinlong’s electric vehicle products can only be buses that run on fixed lines in cities, and it is difficult to apply them to life. Household electric car products with high mileage requirements and uncertain driving routes.

However, Yinlong’s research and development in new energy has never stopped. According to news, in order to improve the performance of the battery pack, Yinlong has developed a fourth-generation high-energy-density lithium titanate battery on the basis of maintaining a long battery life and a high level of high and low temperature performance. 40%, energy density increased by 60%.

Recently, Yin Jianhua, vice president of Yinlong New Energy, disclosed to the outside world that the company has mastered the core technology of hydrogen titanium powertrain and will effectively solve the problem of battery energy density, and pass lithium titanate battery and fuel cell. Combine to increase the mileage of new energy vehicles.

Capital has become the biggest source of problems

According to CNESA's forecast, by 2020, the total installed capacity of domestic energy storage will reach the scale of 14.5GW~24.2GW, and the energy storage battery will pay more attention to the battery life and safety performance. This is exactly the same as the properties of the lithium titanate battery that Yinlong is good at. It is consistent. Yin Long is aiming at such market opportunities and planning a huge industrial map.

However, with the expansion of the industrial landscape comes serious financial problems. According to statistics, at present, the seven production bases under construction in Yinlong have actually exceeded the total cost of 80 billion yuan. Such a huge “fund gap” is undoubtedly the biggest issue that Yinlong will face. Although in May this year, CITIC Bank granted a loan of RMB 27.6 billion to Yinlong Group. However, compared with the loophole in funds exceeding RMB 80 billion, CITIC Bank's loan of RMB 27.6 billion is far from meeting the expansion needs of Yinlong.

Yinlong New Energy Production Base

"At present, Yinlong's valuation is about 13 billion yuan. If it goes public, the market value should be under 30 billion yuan." Some industry analysts had predicted. If calculated according to the scale of Yinlong's market value of RMB 30 billion, and all equity pledges are made, Yinlong will still have a large funding gap from its production capacity of over RMB 80 billion. Of course, for the time being, Yinlong is not a listed company. It does not have the obligation to regularly publish its financial status, but this does not seem to conceal the financial problems caused by its excessively large span.

Zhuhai Yinlong's valuation of RMB 5 billion has soared to RMB 13.4 billion in just one year after the Dongmingzhu site, but it has to be admitted that Yinlong still has funds, lithium titanate battery applications, and automotive supply chain management. Challenges such as pressure and sales of new energy vehicles. Yinlong’s large-scale expansion is speculation or investment. I believe that once these problems are resolved, they will have answers.