Another lithium battery company plans to go overseas for financing.

on the evening of July 31, shengxin lithium energy (002240.SZ) issued a number of announcements on the proposed issuance of global Depositary Receipts (GDR) and listing on the Swiss stock exchange. The listed company intends to raise 2.3 billion yuan to expand lithium salt production and supplement working capital.

Since the expansion of the "Shanghai-London Link" mechanism to the "China-Europe Link" mechanism in early 2022, Switzerland has become a popular destination for overseas listings of lithium-ion enterprises. Judging from the announcement of lithium-electric enterprises, going out to sea to achieve a global layout has become one of the biggest attractions of issuing GDR.

plans to raise 2.3 billion yuan to increase lithium salt reserves

According to Sheng Xin Li Neng's disclosure, the total amount of funds raised by the listed company in this issue of GDR shall not exceed RMB 2.3 billion (or equivalent foreign currency), and it is proposed to invest the net amount of funds raised after deducting the issuance expenses of RMB 1.61 billion in lithium salt expansion and technological transformation, including Indonesia Shengtuo 60000 tons of lithium salt project, Argentina SDLA salt lake annual output of 2500 tons (LCE) lithium chloride technical upgrading project, Shengjing lithium industry 20000 tons of lithium salt processing project, Shengxin metal phase I 5000 tons of lithium salt project, another 0.69 billion yuan is planned to be used to supplement working capital.

On the significance of this overseas financing, Shengxin Lithium said it will increase the company's production scale of lithium products, continue to strengthen the company's global layout, while optimizing the company's capital structure to meet working capital needs.

Indonesia's shengtuo 60000-ton lithium salt project, which is the largest single project to be invested, is one of the key projects being promoted by shengxin lithium energy in recent years. the total investment of the project is 2.487 billion yuan, which is expected to be completed and put into operation by the end of 2023. shengxin lithium energy plans to invest 0.87 billion yuan of the funds raised from the GDR.

Shengxin LiNeng has previously stated that continuous enhancement of resource reserves is one of the company's most important operating tasks. The company will actively use various channels to continue to look for high-quality lithium resource projects on a global scale. According to the announcement of the listed company, by the end of 2022, Shengxin Lithium Energy has built a lithium salt production capacity of 70000 tons, which means that Indonesia Shengtuo this lithium salt project will significantly increase the scale of the listing announcement capacity after it is put into production.

in addition, the lithium salt sales of sheng new lithium energy are currently dominated by domestic customers. in 2022, the company's overseas revenue will account for 9.15 of the total revenue. The company said that it will actively expand overseas high-quality customers and continuously increase the proportion of overseas business. Regarding the construction of the Indonesian project, Shengxin Lithium Energy also said that it is conducive to better serving overseas customers.

Shell financial reporter concerned, Sheng Xinli can to be part of the funds raised for supplementary liquidity said, "products and raw materials fluctuations will have an impact on the company's operations ...... so supplementary liquidity can be used to balance the product and raw material price fluctuations brought about by the financial pressure, increase the company's ability to resist risks, with a certain degree of necessity".

The previous performance forecast issued by Sheng Xinli Energy showed that it is expected to achieve a net profit of 0.6 billion yuan to 0.7 billion yuan in the first half of 2023, a year-on-year decrease of 76.81 to 80.13. The listed company said that the increase in costs caused by the increase in upstream material prices compared with the same period last year affected the company's profit during the reporting period.

lithium battery enterprises have successively rushed to the Swiss exchange. what is the attraction of GDR?

Since the expansion of the "Shanghai-London Link" mechanism to the "China-Europe Link" mechanism in early 2022, Switzerland has become a popular destination for overseas listings of lithium-ion enterprises.

the first Chinese listed companies to issue GDR in July 2022 include Guoxuan high tech (002074.SZ), greenme (002340.SZ), cedar shares (600884.SH) and keda manufacturing (600499.SH), with raised funds ranging from us $0.173 billion to us $0.685 billion.

Subsequently, Xinwanda (300207.SZ), Hangke Technology (688006.SH), Huayou Cobalt (603799.SH) and other lithium-ion sector listed companies have also completed GDR issuance. The listing applications of companies such as Pilot Intelligence (300450.SZ), Tianci Materials (002709.SZ) and Tieneng Shares (688819.SH) have also been approved by the Swiss Stock Exchange Regulatory Authority.

in June this year, the Shanghai and Shenzhen stock exchanges solicited public opinions on the revised interim measures for the listing and trading of interconnected depositary receipts. the new rules plan to clarify the listing conditions for new basic stocks in GDR and the relevant arrangements for issuance review, including that GDR issued and listed overseas should meet the condition that it has been listed on the Shanghai and Shenzhen stock exchanges for one year and the average market value of the 120 trading days before the application date is not less than 20 billion yuan. In addition, the new regulations also require strengthening the supervision of information disclosure in the whole process of issuing GDR.

in mid-June, dongwei technology (688700.SH), which specializes in electroplating equipment, became the first enterprise to successfully complete the issuance after the new GDR regulations.

From the lithium-electric enterprise announcement, going overseas to achieve a global layout has become one of the biggest attractions of issuing GDR.

For example, Glimmer proposed that the issuance of GDR will help the company to use overseas capital markets to promote the company's overseas nickel resources and power battery materials project layout and stabilize overseas markets, enhance the company's global reputation and global industry competitiveness. Liu Jianbo, chairman of Dongwei Technology, also said that the funds raised by the issuance of GDR will be used for capacity expansion on the one hand, and on the other hand, it will be used to enhance the company's global research and development capabilities and lay the foundation for future capacity expansion.

"when Chinese enterprises go international, they not only want their products to go international, but also their technology to go international, but also their capital to go international." Li Wei, chairman of Guoxuan Gaoke, said publicly last year. According to Guoxuan Gaoke, the funds raised by the company's GDR issuance will be mainly used for the company's international industrial layout and accelerate the company's internationalization strategy.

With the price correction of lithium carbonate since this year, the performance of lithium battery enterprises, especially those located in the upper reaches of the industrial chain, has been directly affected.

Wind data shows that 29 listed companies in the lithium battery sector have disclosed semi-annual performance forecasts, of which 16 companies are expected to decline year-on-year, and 5 companies are expected to experience losses.

Tianli Lithium Energy (301152.SZ) is expected to lose 60 million yuan to 80 million yuan in the first half of this year. The listed company said that in the first half of 2023, due to the large price fluctuations in the lithium salt market, downstream battery manufacturers were cautious in receiving orders, and the company's sales order quantity and sales price were adversely affected; at the same time, due to the failure of product sales prices and purchase raw material price trends in time Transmission, the overall sales gross profit margin decreased year-on-year.