Cyclone of the Yellow River: Resilience to steady growth during the transition

The competition in the synthetic diamond industry is becoming increasingly hot. The company is gradually getting rid of the low-level model of profitable synthetic diamonds and began to cover the entire industrial chain of “synthetic diamond, micro-powder, pre-alloyed metal powder and composite sheet”. After the production, the gross profit margin of pre-alloyed metal powder and composite sheet is about 40% higher than that of synthetic diamond 30%, which is the only way for the company to improve its future profit. In 2014, the sales revenue of the two projects is expected to reach 1.1 billion. It will account for half of the company's revenue (the company's artificial diamond business sales revenue is expected to reach about 1.3 billion); in 2012-2014, the fundraising project will help the company's annual average compound growth rate of more than 40%. "Complete industrial chain + technical strength" The necessary conditions for the development of high-end products The development of composite sheets and photovoltaic cutting lines and other products must have high-quality micro-powder products; and high-quality micro-powder products must be based on high-quality synthetic diamond as raw materials; High-end diamond products must have a complete industrial chain and solid technical strength. The company's synthetic diamond ranks second in the industry in terms of domestic production, second only to Zhongnan Diamond, a subsidiary of the Weapons Group; its specifications and quality are comparable to the international advanced level. In addition, the company's micro-powder quality level has been recognized by Asahi Diamond, a well-known Japanese synthetic diamond manufacturer. As a primary raw material for the production of micro-powder for photovoltaic cutting wire, Asahi conducts secondary screening. The diamond industry is in a booming period. The prospects for the company's fundraising projects are promising. The current supply and demand of synthetic diamonds is basically balanced. It is expected that the demand will maintain a growth rate of 10-15% in 2013-2015, and the company's capacity expansion will be about 15%. Pre-alloyed powder has been widely used in the 1990s. The domestic market is still in the introduction stage. The user has begun to recognize that the company's technical level and scale are leading domestically, the orders are full, the gross profit margin is currently over 30%; the capacity utilization rate in 2011 is about 12.5%. In 2012, it will increase significantly to over 30%. With stable quality and affordable price, the company's composite film is currently in short supply in the domestic market and will gradually replace imports. The current gross profit margin is over 30%, and the main target market is mine; the capacity utilization rate in 2011 is 20%, and it is expected to increase significantly in 2012. More than 30%. According to Japan's Asahi development history, the company's products will be upgraded in the future. According to the development history of Japan's Asahi Diamond product structure, the company has the space to develop into the electronic semiconductor and transportation industry in the future. At present, the company has the strength to enter the cutting wire of photovoltaic and LED sapphire substrates, but as the customized equipment needs further improvement, it is being raised, and the profit prospect is worth looking forward to. Risk warning: 1) The production capacity growth is out of control and there is a serious excess; 2) The economy continues to be sluggish and the downstream is weak.

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