Huayou Cobalt (603799): Proposed Issuance of Shares to Purchase Equities of Bamo Technology and Huayou Yinzhou and Matching Financing of RMB 3.2 billion

Investment points The company intends to purchase shares of Bamo Technology and Huayou Luzhou and raise supporting funds by issuing shares.

On April 19, the company announced that it plans to start with 32.

24 yuan / share issue 1.

2.6 billion shares purchased 100% stake in Bamo Technology and Huayou Yinzhou 15.

68% equity, after the completion of the transaction, the company Bamo Technology and Huayou Luzhou will become wholly-owned subsidiaries of the company.

(1) The company intends to issue shares to 8 counterparties in Hangzhou Hongyuan, Xinba New Energy and other parties to purchase 100% of Bomo Technology; the transaction consideration is 32 trillion.

(2) The company intends to issue shares to Cinda Xinneng to purchase Huayou Luzhou15.

7% equity at a transaction consideration of 8.

600 million.

At the same time, the company intends to raise funds of 3.2 billion in non-public offerings and issue no more than one share.

6.6 billion shares are used for the industrialization project of high-energy-density power battery materials of Bamo Technology to supplement the company’s working capital.

In addition, the company will resume trading on April 22, 2019. Bamo Technology is one of the leading companies in the transformation of materials, and the continuous expansion of production capacity guarantees performance.

Bamo’s main products are lithium cobaltate and ternary materials. In 2018, the injection volume of lithium cobaltate was 8,800 tons, ranking third in the country (16.

16%). At the same time, the number of NCM releases reached 6700 tons, accounting for 4%.


2017/2018 revenue was 37.


4.4 billion, with a net profit of 1.


RMB 860,000; Chengdu Bamo’s 2017/2018 revenue was 18.


4 megabytes, with a net profit of 4217/5281 million U.S. dollars, and an annual capacity of 10 raw materials for Chengdu Bamo ‘s future planning. With the relatively high net rate of Chengdu Bamo ‘s expansion, Hangzhou Hongyuan as theThe performance commitment is artificial, and promises that Bomo Technology’s net profit after tax for 2019-2021 will not be less than 2.

1.5 billion, 2.

8 billion, 3.

63 ppm, corresponding growth rate of 149.

无锡夜网7% / 30.

2% / 29.

6%, the maximum net profit gradually realized in three years is not less than 8.

5.8 billion.

In addition, Huayou Cobalt mainly sells cobalt trioxide and other products to Bamo, which reached 13 to Bamo in 2018.

05 ppm, accounting for 13 of Huayou’s cobalt product revenue.

63%, it is expected that after the acquisition, the synergy between the company and Bamo will significantly increase again.

The shares of the company to be listed acquire Cinda Xinneng, which holds Huayou Luzhou15.

68% equity at a reasonable premium.

Huayou Yinzhou is the company’s main base for the smelting of cobalt and copper products; from 2017 to 2018, Huayou Yinzhou realized operating income of 59.

9 and 86.

400 million, net profit is 8 respectively.

8 and 4.10,000 yuan.

In October 2018, Cinda Xinneng acquired the credit assets of Huayou Luzhou and simultaneously obtained a capital increase by way of debt-to-equity swap7.

300 million, thus obtaining Huayou Luzhou 15.

7% equity also effectively reduced Huayou Yinzhou’s asset-liability ratio.

The company is currently at 8.

6 billion US dollars of trading consideration replaced Huayou Luzhou 15.

7% equity, compared to 7.

3 trillion debt conversion price premium 18.


Considering that there is a 12-month lifting of the ban after Cinda Xinneng uses Huayou Yinzhou to enter the shares of listed companies, the premium is relatively reasonable.

In addition, the company plans to raise funds of 32 trillion for non-public offering, and the issue price has not been determined.

The company intends to raise funds of 3.2 billion in non-public offerings, and the number of shares to be issued does not exceed 20% (1.

6.6 billion shares), the issue price has not yet been determined.

The raised funds are mainly used for advanced intelligent manufacturing projects for the industrialization of high-energy-density power lithium-ion battery materials by Bamo Technology, supplementing the liquidity of listed companies, etc. It is expected that the funds will effectively reduce the company’s asset-liability ratio and improve the company’s profitability.

Profit forecast and grade: As the PE527 and MIKAS technical transformation projects gradually reach full production, their own cobalt ore volume has significantly increased, and the proportion of self-supplying cobalt ore mines may continue to increase.

At present, MB cobalt has begun to rebound. It is expected that the cobalt price will bottom out and the company will gradually move from a leader in cobalt to a leader in lithium battery new energy.

Maintain the company’s profit for 2019-2021, and expect to achieve net profit attributable to the mother, respectively8.

300 million, 13.

200 million, 16.

1 ppm, EPS is 1.

0 yuan, 1.

6 yuan, 1.

9 yuan (not considering the replacement issue), calculated at the closing price on April 19, PE is 42.

3X, 26.

6X, 21.


Maintain the level of “prudent overweight”.

Risk reminder: the supply side is too fast, the price of cobalt has dropped sharply, and its own project is less than expected risk

Posted in 桑拿