Finance Associated Press, December 13 (Reporter Wang Bin).Shanshan Co., Ltd. (600884.)SH) continued to increase the polarizer business layout.
This evening, Shanshan Co., Ltd. announced that its subsidiary Shanjin Optoelectronics (Suzhou)**hereinafter referred to as "Shanjin Optoelectronics") intends to set up a project company in Yangzhou (hereinafter referred to as "Yangzhou Project") and invest in the construction of an annual output of 40 million square meters of high-end display polarizer production line project, with a total planned investment of no more than 6 billion yuan (including the purchase price of the company's proposed acquisition of LG Chemical's SP business and related assets, as well as the subsequent relocation and transformation investment). Among them, the investment in fixed assets is about 4.5 billion yuan, and the working capital investment is about 1.5 billion yuan.
In Shanshan's view, the market demand for polarizers for high-end displays is growing rapidly and there is a broad space for domestic substitution, and the completion of the project will be conducive to the company's improvement of the polarizer business product layout. Citing Cinno Research's projected data, the total growth rate of OLED polarizers will be about 102% by 2025, with an average annual compound growth rate of about 13%.
Specifically, Shanshan Co., Ltd. has invested in the construction of three production lines in Yangzhou, including two high-end polarizer production lines for consumer electronics display (including polarizers for OLED and LCD IT Mobile displays) and related supporting materials R & D and production equipment, power and environmental protection facilities, with a planned annual production capacity of 30 million square metersAnother high-end polarizer production line for vehicle display and related supporting materials R & D and production equipment, power and environmental protection facilities, with a planned annual production capacity of 10 million square meters.
It is reported that the Yangzhou project will start project preparation in January 2024 and enter the construction period before September 2025 (inclusive), with a total preparation period of about 39 months. Based on this, the project is expected to be put into production in Q2 2027.
Shanshan shares also reminded that due to the large total planned investment in the Yangzhou project, if the company's overall operating cash flow or financing does not meet expectations, there is a risk that project funds cannot be raised in time.
It is worth mentioning that in September this year, Shanshan Co., Ltd. announced that its subsidiaries Shanjin Optoelectronics and Shanjin Optoelectronics (Guangzhou)** planned to pay RMB 140.7 billion yuan to acquire LG Chem's SP business and related assets in Chinese mainland, South Korea and Vietnam. Among them, the fixed assets involved in the transaction are mainly 2 polarizer production lines (including front-end extension and back-end cutting inspection and packaging) of LG Chemical's Ochang factory in South Korea and 1 back-end cutting inspection production line of LG Vietnam polarizers, and the inventories involved are mainly semi-finished products, finished products and raw materials.
Previously, Zheng Ju, chairman of Shanshan Co., Ltd., told the Financial Associated Press reporter that according to the plan, the company's polarizer production capacity in 2026 will reach 3200 million square meters, accounting for more than 50% of the global market share.
Polarizers are known as "chips" in the optical industry, and are widely used in TVs, smart phones, tablet computers, laptops, car screens, smart wearables and other terminal applications that require display functions. In 2021, Shanshan Co., Ltd. acquired LG Chem's polarizer business and established Shanjin Optoelectronics, which has formed two core businesses: lithium battery anode materials and polarizers. In June this year, the company's first self-built ultra-wide production line was successfully put into operation.
In terms of performance, in the first three quarters of this year, Shanshan achieved revenue of about 1470.9 billion yuan, a year-on-year decrease of 714%；The net profit attributable to the parent company is about 120.2 billion yuan, a year-on-year decrease of 4558%。In the first half of this year, the company achieved revenue of 53 in the polarizer business0.6 billion yuan, down 736%, and the net profit attributable to the parent company was 60.7 billion yuan, down 2412%。