Dongshan Precision: Become the largest precision sheet metal manufacturer in China

Suzhou Dongshan Precision Manufacturing Co., Ltd., which entered the precision manufacturing service industry earlier in China, is about to land in the A-share market. Dongshan Precision (002384) issued 40 million shares this time, accounting for 25% of the total issued share capital. The issue price is 26 yuan/share. , corresponding to a price-earnings ratio of 57.78 times.

Dongshan Precision was established in 1998 and was established by Suzhou Dongshan Jinjin Co., Ltd. as a whole. At present, the company mainly provides precision sheet metal parts, precision castings and assembly products and technical services for customers including communication equipment, new energy, precision machine tool manufacturing, etc. Among them, precision sheet metal parts are the company's leading products.

After more than ten years of continuous investment, Dongshan Precision has grown into the largest precision sheet metal manufacturing enterprise in China, leading the domestic counterparts in scale, technology, equipment and management, and has the largest customer base among domestic precision sheet metal manufacturing enterprises. In the industry, the popularity is getting higher and higher, forming a certain brand status, and attracting more and more multinational giants to seek cooperation.

As a high-tech enterprise, Dongshan Precision undertakes the precision sheet metal outsourcing business of the global downstream customers, and develops from the initial precision sheet metal parts manufacturing to the complete set of components with precision sheet metal parts as the core or provides customers with complete products. Stationary service. At present, it has passed the system certification of 62 global customers, and the scale of customers is still increasing. Dongshan Precision has world-class manufacturing equipment and a world-class customer structure. Key industry customers serving the company include:

Communications equipment industry: Ericsson and Huawei, the top three communications equipment integrators in the global industry; ranked among the world's top four wireless communications antenna manufacturers Andrew, Anvers, and Polwell.

New energy industry: SolFocus, the world's leading supplier of concentrating solar photovoltaic systems, and Areva, a nuclear power generation equipment manufacturer (the nuclear industry ranks first in the world's Fortune 500).

Machine tool industry: Agie Charmilles and Sodick, the world's two largest wire-cutting machine tool manufacturers, and Sanguang Technology, the largest wire-cutting machine tool manufacturer in China.

At present, Dongshan Precision's customers are widely distributed in communications, new energy, machine tools, and finance. Among them, communication-related businesses are the largest, and new energy is the fastest growing.

Benefit from the growth of leading corporate customers
In the field of communication equipment manufacturing, Ericsson, Nokia Siemens, Huawei, Alcatel-Lucent, Nortel Networks, Motorola and other top six communications equipment manufacturers account for about 80% of the market. In the industry that provides wireless communication base station antenna manufacturing services for communications equipment manufacturers, the sales of the three companies in the top four companies, Polvi, Andrew and Anvers, accounted for 29% of the world's communications antenna demand in 2008. It reached 1.15 million sets, and the field of communication equipment manufacturing and wireless communication base station antenna manufacturing showed a high market concentration.

Dongshan Precision became a qualified supplier of Andrew, Polvi and Anvers in 1999, 2001 and 2004 respectively. From 2006 to 2008, the company's main income came from these three companies and it developed rapidly. In 2008, the company faced Andrew and Polve. The number of precision sheet metal sleeves sold by the three communication antenna equipment manufacturers and Anfusch has accounted for 16%, 45% and 33% of the corresponding antenna sets of the customers respectively. The company is the largest supplier of Polvi and Andrew.

In the second half of 2007, companies in the new energy industry represented by SolFocus and Areva, and financial equipment manufacturers represented by NCR successively completed the certification of the company's manufacturing system; the company became Ericsson and Huawei in 2008 and 2009. Qualified suppliers of international wireless communication base station antenna manufacturers; In early 2009, after long-term business negotiations and trial production of batch products, the company and SolFocus formally reached an agreement, the two parties will jointly develop the market in the new energy industry, the company provides Production and system integration services for key components of solar power systems. We expect 2010 to be a key year for high growth, and these customers will also be a powerful driving force for Dongshan Precision's continued high growth.

Domestic leading competitive pressure is small
Dongshan Precision's main competitors include companies in the two sub-sectors of precision sheet metal and precision casting. The main competitors of precision sheet metal manufacturing: Wuxi Subsidiary of Huiman Company, Suzhou Fujite Metal Sheet Products Co., Ltd. and Suzhou Industrial Park Dongsheng Machinery Co., Ltd. These three companies have small income, regardless of scale, equipment and customers. It will not have a direct impact on the company.

The main competitors of precision die-casting manufacturing: mainly including Guangdong Hongtu and Suzhou Chunxing Precision Co., Ltd. Guangdong Hongtu mainly serves the automotive sector and has little to do with the company's current business competition. However, the company is gaining relevant certifications for entering the automotive industry and will form a competitive relationship in the future. Chunxing Seiko is mainly engaged in precision casting and has a competitive relationship with the company. As its precision casting accounts for less than 20% of the company's revenue structure, it is limited.

In general, Dongshan Precision has little pressure on domestic competition in the short term.