Wuhan Beijing Oriental plans to raise 3.775 billion yuan to expand LCD panels

Wuhan Beijing Oriental plans to raise 3.775 billion yuan to expand LCD panels

Beijing Oriental A announced on the evening of March 22 that Wuhan Beijing Oriental, a holding subsidiary, intends to raise 3.775 billion yuan of self-financing to expand production capacity in the existing Wuhan Beijing Oriental plant in combination with the favorable conditions for 25000 glass substrates / monthly plant space reserved at the beginning of construction.

Monthly capacity expanded to 180,000

According to the announcement, the specific construction contents of the expansion of production in Wuhan Beijing and Oriental are as follows: to expand production for the existing 10.5 generation thin film transistor liquid crystal display panel (TFT-LCD) production line, including production and auxiliary production facilities, power facilities, environmental protection facilities, safety facilities, fire protection facilities. After the completion of the construction, the monthly production capacity will be expanded from 155000 substrates to 180000 substrates, with 945 new workers. Process equipment is expected to move in and achieve full production in 2022.

According to the announcement,25000 substrates/month workshop space was reserved at the beginning of the plant construction. Through the expansion of production capacity, the existing workshop space can be fully utilized to avoid idle space. At the same time, in addition to the purchase of new equipment, the expansion project also fully considers the capacity of existing equipment to tap potential and formulates a series of plans to maximize the capacity of the equipment to improve the operational efficiency of existing equipment. Based on the utilization of the existing plant and the potential of equipment capacity, the investment amount required for the new capacity of the expansion unit is much lower than that of the new plant, and the completion of the project will significantly enhance the profitability and competitive advantage of Wuhan Beijing and Oriental.

January 2021, Beijing and East A issued a 20 billion yuan scale plan, one of the proposed investments is to increase Beijing and East Wuhan. Beijing Oriental A intends to buy Wuhan Airport UNIDO Investment, Changbai Fund held 14.44% of Wuhan Beijing Oriental,9.62% of the total price of 6.5 billion yuan, after the acquisition, the company will hold 47.14% of Wuhan Beijing Oriental equity.

Wuhan Beijing and Oriental revenue mainly from the 10.5 generation TFT-LCD production line, in September 2019 to achieve product lighting, the end of December 2019 to achieve mass production. In 2020, Wuhan Beijing and Eastern realized an operating income of 1.775 billion yuan, a net profit loss of 156 million yuan.

Growing demand for large panels

The background of increasing and expanding production is the high visibility of the large-size LCD panel industry. According to research firm Qunzhi Consulting, affected by the continued strong demand for downstream brands and the limited supply of panels due to upstream, especially chip supply, the global LCD TV panel market continued to be short of supply and demand in March, and it is expected that the supply and demand relationship will not improve significantly in the second quarter.

A Beijing and Oriental said that with the development of 5 G、 of new technologies such as the Internet of things, big data, and so on, the next five years will be the golden period of the development of 4 ultra-high-definition display technology, and the technology upgrade will promote the continuous transfer of display consumer products to high-end and medium-sized products.

Beijing Oriental A expects large panel demand to continue to grow in the next five years, with demand for 65-inch and 75-inch products as economic cutting dimensions for 10.5 generation production lines. In order to meet the incremental demand of customers and further seize the incremental market of large and medium-size panels, it is necessary for Wuhan Beijing and Oriental to implement the production line expansion project, expand the capacity of the corresponding large and medium-size panels, and ensure the competitive advantage.