Another leading titanium dioxide enterprise plans to build iron phosphate new energy materials project. Jinpu Titanium Industry plans to raise no more than 900 million yuan, and plans to invest in 100000 tons / year new energy battery material precursor and thermal energy comprehensive utilization project. This investment project is expected to increase the production capacity of battery-grade ferric phosphate 100000 tons per year and sulfuric acid 300000 tons per year. At present, Jinpu Titanium Industry has responded to the second round of inquiries from the Shenzhen Stock Exchange about the company's application to issue shares to specific targets.
A reporter from the Economic Information Daily noted that under the situation of slowing down the performance growth of the titanium dioxide industry, listed companies in the industry have accelerated the pace of layout in the field of new energy batteries. Longbai Group, China Nuclear Titanium dioxide, Huiyun Titanium Industry, Anada and other comparable listed companies have layout iron phosphate projects. In recent years, the overall profitability of Jinpu titanium industry shows a fluctuating downward trend, the performance is under obvious pressure. Under the influence of the increasingly fierce competition in the industry, iron phosphate price fluctuations and other factors, it remains to be seen how to digest the new production capacity of Jinpu titanium industry and whether it can get rid of the performance dilemma.
Whether the fund-raising project is invested in the main business is asked.
Jinpu Titanium Industry is an early high-tech enterprise specializing in the research, production and sales of titanium dioxide in China. The company said that after the completion of the fund-raising project, it can not only fully absorb ferrous sulfate and other by-products in the production process of titanium dioxide, realize the extension of the titanium dioxide industry chain, but also distribute new energy battery materials and form a new performance growth point of the company.
According to the prospectus, Jinpu Titanium Industry plans to raise no more than 900 million yuan, which is issued to no more than 35 (including capital) specific targets, including its controlling shareholder, Jinpu Group. The company's investment project is 100000 tons / year new energy battery material precursors and thermal energy comprehensive utilization project, the main products are 100000 tons / year iron phosphate and 300000 tons / year sulfuric acid.
In this regard, in the two rounds of audit inquiry letters, the Shenzhen Stock Exchange inquired whether the company's fund-raising projects met the relevant requirements of the main business. The Shenzhen Stock Exchange requires the company to explain the reasons for entering the field of new energy materials, the difference and relationship between the relevant business and the existing business, and to add whether battery-grade ferric phosphate and sulfuric acid belong to new business, new products and other issues.
The reporter noted that as early as March 26, 2022, Jinpu Titanium Industry began to lay out the field of new energy materials. Jinpu Titanium Industry and Anhui (Huaibei) New Coal Chemical synthetic Materials Base Management Committee signed the "Strategic Cooperation Framework Agreement". The company plans to build 200000 tons / year battery grade iron phosphate, 200000 tons / year lithium iron phosphate and other new energy battery materials integration projects. On April 11, 2022, Nanjing Titanium dioxide, a wholly-owned subsidiary of Jinpu Titanium Industry, funded the establishment of Jinpu New Energy, which is used to implement the project of comprehensive utilization of new energy battery materials and thermal energy with a capital contribution of 400 million yuan and a shareholding ratio of 100000 tons per year. The implementation site of the additional investment project is located in Anhui (Huaibei) new coal chemical synthetic material base, and the main body of the project is Jinpu new energy.
"Ferric phosphate is an important downstream application of ferrous sulfate, the main by-product of titanium dioxide. Sulfuric acid is the company's existing product and the main raw material of titanium dioxide. This investment project is a natural extension of the titanium dioxide industry chain, has a significant synergistic effect with the existing titanium dioxide business, and meets the requirements of raising funds to invest in the main business. " Jinpu titanium industry said that this investment project belongs to the chemical raw materials and chemical products manufacturing industry as well as titanium dioxide, and some of the processes and devices of the main product ferric phosphate are similar to or similar to titanium dioxide. The main product sulfuric acid is the same as the company's existing sulfuric acid production line, and some processes and devices are similar, and there is no significant difference between the completed operation mode and profit model and the existing titanium dioxide business. It belongs to the upstream and downstream extension of the existing titanium dioxide industry chain. In addition, Longbai Group, China Nuclear Titanium dioxide, Huiyun Titanium Industry, Anada and other comparable listed companies have layout iron phosphate projects, the company's investment project is in line with the industry development trend.
How to digest the new production capacity to be solved
In recent years, under the pressure of performance, a number of titanium dioxide enterprises have turned their attention to the field of new energy materials to create new performance growth points. Under the background that comparable companies in the same industry are laying out iron phosphate projects one after another, the competition in the industry is becoming more and more fierce. How to digest the new production capacity of Jinpu titanium industry has also become the focus of the exchange. Affected by the supply and demand of lithium iron phosphate cathode materials, the price of iron phosphate began to rise sharply in mid-2021 and then fell back rapidly. at present, the price has returned to the historical low of 12000 yuan / ton since April 2019.
According to the inquiry of public information, the main capacity under construction in the iron phosphate industry is 3.4 million tons / year. Among them, the medium nuclear titanium dioxide has an annual production capacity of 500000 tons of lithium iron phosphate project. at present, the first phase of the company's annual production capacity of 500000 tons of iron phosphate 100000 tons / year has completed the commissioning of a production line and has a stable production capacity. at present, it has entered the stage of product verification, the main sample verification enterprises, including Chinese head cathode material manufacturers, are expected to form sales in 2023.
In addition, according to the data of Gao Gong Lithium Power, about 1.05 tons of lithium iron phosphate can be produced with 1 ton of iron phosphate, and it is estimated that the global apparent consumption of lithium iron phosphate will reach 3.55 million tons in 2026 according to the forecast of the head Leopard Research Institute. The global market capacity of iron phosphate will reach about 3.38 million tons in 2026.
Jinpu Titanium Industry said that the company plans to increase the annual production capacity of iron phosphate by 100000 tons in this investment project, which accounts for a small proportion of the production capacity under construction and future market capacity. The fund-raising project is expected to add 100000 tons of ferric phosphate, 300000 tons of sulfuric acid, 128300 tons of agricultural ammonium sulfate and 157000 tons of iron powder. Through the deep binding of upstream and downstream industrial chain, product quality optimization and upgrading, production cost control and other measures, the company produces competitive products to digest the new production capacity.
Among them, in terms of iron phosphate products, the company has signed a "Strategic Cooperation Framework Agreement" with Jiangxi Jinli Science and Technology Co., Ltd., and plans to purchase a total of about 50, 000 tons of battery-grade iron phosphate from the company during 2023-2025. Jointly invest with Lanzhou Jinchuan Science and Technology Park Co., Ltd., Gansu Nickel Capital Industry Investment Fund (limited partnership) to set up Gansu Jinlin Lithium Electric New Materials Co., Ltd., plan to build 200000 tons / year lithium iron phosphate project, estimated to need 210000 tons of iron phosphate, will give priority to purchasing the company's iron phosphate products We discussed the supply and marketing cooperation of iron phosphate with downstream enterprises such as Yongtong Hi-Tech, Yuneng, Guoxuan Hi-Tech, Shandong Fengyuan, Taihe Technology, Ningxia Baofeng and so on.
However, under the competitive pressure of the industry, the iron phosphate sales of titanium dioxide enterprises have been lower than expected, and Jinpu titanium industry as a "latecomer", the future new capacity digestion needs to be tested by the market. Earlier, Anada said at the performance presentation that the company's sales of iron phosphate increased in the first half of the year compared with the same period last year, but there was still a gap with the company's expectations, mainly due to the influence of the market, insufficient downstream demand and increased competition pressure in the superimposed market.
There is a big risk of fluctuation in product price.
In recent years, the performance of Jinpu titanium industry fluctuates greatly, and the comprehensive gross profit margin shows a downward trend as a whole. From 2020 to 2022 and from January to September 2023 (hereinafter referred to as the "reporting period"), the company's comprehensive gross profit margin was 8.53%, 20.47%, 6.32% and 1.57% respectively, and the gross profit margin of titanium dioxide products was 5.70%, 19.03%, 5.63% and 1.09% respectively, and the net profit was-250.2233 million yuan, 107.3131 million yuan,-146.0762 million yuan and-9207.5 million yuan respectively.
Flush data show that from 2019 to 2022, the weighted return on net assets of Jinpu titanium industry was 1.21%,-12.89%, 5.76% and-7.71%, respectively, and the overall profitability showed a fluctuating downward trend. Compared with the comparable company's performance in the first three quarters of 2023, Longbai Group and Huiyun Titanium Industry did not increase profits in the first three quarters, while medium Nuclear Titanium dioxide and Anada revenue and net profit both dropped, while Jinpu Titanium Industry was the company with the largest decline in net profit, with net profit falling 492.41% in the first three quarters compared with the same period last year.
Jinpu titanium industry said that the company's titanium dioxide products are affected by the macroeconomic cycle, supply and demand, market expectations, speculation and many other factors, and the prices of raw materials such as titanium concentrate, sulfuric acid and iron powder needed to produce titanium dioxide are mainly affected by fluctuations in commodity prices outside China, and the cost of raw materials accounts for about 60% of the production cost of titanium dioxide, which has a significant impact. From January to September in 2022 and 2023, due to the increase in the price of the company's main raw materials and energy, as well as the sales price of titanium dioxide, the company's gross profit margin and net profit decreased significantly compared with 2021, and suffered losses.
In terms of product price, the risk of price fluctuation of titanium dioxide and ferric phosphate can not be ignored. At present, the structural and phased surplus of China's titanium dioxide market will continue in the short term, coupled with the further increase in production capacity brought about by the vigorous development of chlorination, there is a greater risk of fluctuation in the market price of titanium dioxide products. The price of iron phosphate has also fluctuated greatly in recent years. On the one hand, the rapid development of the lithium battery industry of new energy has led to a rapid rise in the price of iron phosphate; on the other hand, it is affected by factors such as the decline of subsidies, the price reduction of fuel vehicles and the slowdown of the market growth rate of new energy vehicles, resulting in a decline in the price of lithium battery materials such as iron phosphate.
Jinpu Titanium Industry said frankly that if the company's main raw materials and energy prices continue to rise in the future, and the sales price of titanium dioxide cannot rise in the same proportion, or if companies in the same industry compete against the company by virtue of its cost advantage, the company's titanium dioxide gross profit margin and operating results are at risk of further decline and continued losses.
