ST cloud network transboundary PV NET myth surprise

Polaris solar PV net news: on April 29, ST cloud network acquisition plan, the company plans to issue shares bought by Ningbo, Wuxi environmental sanitation, jinneng, Shanghai XI 6 shareholders holding Ding into Sichuan electric power engineering Ltd (hereinafter “China Ding”) 100% equity.

Sichuan Ding is mainly engaged in investment in solar photovoltaic power plant development and construction, as a general contractor for the construction of photovoltaic power plant development, Sichuan Ding is responsible for the project survey and design, device purchasing, construction and other links.

Prior to this acquisition, Sichuan Ding has undergone several ownership transfers, compared with the previous transfer valuation, this acquisition in the Sichuan Ding valuations increase significantly.

According to the plan, in 2016, Sichuan Ding into rapid growth. But public information, close to 60% ‘s business comes from the connected transactions of the company. What is more worrying is, without the support of related parties, Sichuan is able to continue to maintain the profitability of Ding.

Share capital valuations soared feast

According to the plan, Sichuan Ding was founded on February 6, 2015, co-sponsored by Zhu Wanjun and Cai Xingjun established company with registered capital of 5 million Yuan.

On August 11, 2015, Zhu Wanjun Sichuan Ding 65% its ownership transferred to Wuxi environmental sanitation, transfer rate is 4.225 million; its equity transferred to Sichuan Sichuan Ding 15% puzheng, the transfer price for 975,000. Cai Xingjun its equity transferred to Sichuan Sichuan Ding 20% puzheng, the transfer price of 1.3 million Yuan. At this point, the tripod into the overall valuation of 6.5 million yuan in Sichuan.

On March 30, 2016, Sichuan Sichuan Ding 35% puzheng its share transfer to Ningbo Tin-can, the transfer price of 155 million Yuan. At this point, the tripod into a valuation of about 443 million Yuan, Sichuan.

According to the plan, Sichuan Sichuan Ding puzheng get into 35% equity investment of 3.5 million Yuan. Holding less than eight months, Sichuan puzheng more than 150 million Yuan.

Business information, Park is in Sichuan province was established on August 13, 2015, when getting a tripod for equity in Sichuan, the company has not yet completed business registration company with registered capital of 1 million Yuan, two natural person shareholders Lin Qiang and Fan Yaqin, respectively.

As an equity purchaser, Ningbo Tin can was founded on March 22, 2016, its partners and Jiang Qian Bian Qiaofeng, Bian Qiaofeng as limited partners, the proportion of the subscribed capital of 99%; Jiang Qian to unlimited liability partner, accounting for the proportion of the subscribed capital of 1%.

Statistics show that Wuxi sanitation 87.13% owned by Bian Qiaofeng also, Wuxi environmental sanitation actual control. Ningbo Tin-can and puzheng before trading in Sichuan, Sichuan Ding Bian Qiaofeng held by Wuxi environmental sanitation into 65% shares.

It is to be noted that, according to public information, on December 10, 2015, Wuxi, Wuxi environmental sanitation and Zhou Feng Ke (hereinafter “Wuxi Zhou Feng”) joint venture majority-owned subsidiaries. According to available data, Wuxi day natural person shareholder of the same Fan Yaqin and Lin Qiang.

Puzzling is that Ningbo Tin-why so high a premium partners shareholders equity?

Plan, Ding said, Sichuan, Sichuan puzheng of financial investors, aware of the Sichuan top cost is intended to introduce new investors and capital after the operation with the listed companies, puzheng in Sichuan province based on capital operation of uncertainty about the future consideration and lock on the shares of the listed company made arrangements for the future, Ding into voluntarily opted out of Sichuan.

More noteworthy is that according to the plan, on April 5, 2016, Ningbo Tin can transform its Sichuan Ding 14.732%, 11.339%, 4.464%, 4.464% of the shares are transferred to Shanghai XI phantom responsibility, Shanghai, Shanghai Xu Hui ying and Shanghai, the transfer price was 165 million, 127 million, 50 million and 50 million Yuan.

At transfer prices, within a week, Sichuan Ding value explode to 1.12 billion yuan, an increase of 152.82%.

This acquisition, Ding in Sichuan estimated about 1.44 billion yuan, representing former shareholders shareholder valuation has once again added value of 320 million Yuan, the reference date for March 31, 2016. In other words, Sichuan Ding after the valuation date of the valuation but less than the valuation of the acquisition, there is no doubt that undermine the interests of minority shareholders.

As at the valuation date, Sichuan Ding unaudited net book value of the parent company for 48.5783 million Yuan, appreciated 1.356 billion yuan, the multiplier is about 2792.11%; Ding received base in Sichuan province in the future taking into account replenishment sum of 400 million Yuan, in the deal, Sichuan top estimated price of about 1.8 billion yuan.

Related party transactions fattening performance

Plan, Ding said, Sichuan, Sichuan Ding Ningbo Tin-up firms such as haiyouxi into 35% shares, deals priced higher than the company equity investments costs, mainly based on Wuxi sanitation control and its associated on Sichuan Ding into the rapid development of outstanding contributions, after consultations among the parties and gives the people of Wuxi sanitation control and its associated high premium on share transfer.

Financial data shows that in 2015, the Sichuan tripod into a revenue amount is zero,-6.4495 million yuan in net profit. 2016 1 March, Ding Cheng achieved operating income of 307 million yuan in Sichuan, reported net profit of 53.0615 million Yuan, the company accelerated significantly in performance.

Is in need of attention, 2015, the Sichuan Ding has signed several cooperation agreements with related parties, the company’s earnings growth is to a large extent depend on related party transactions.

Public information displayed, October 28, 2015, Sichuan Ding into and subsidiary respectively and toksun County gold Sun PV power limited, and static gold Sun power limited signed agreement, trading subject matter for signed Jiangsu gold Sun toksun County 20MWp grid PV power project and II Division 21 mission 20MWp PV grid project design construction and the equipment procurement contract, contract amount total for 392 million Yuan, specific contract intends by Sichuan Ding into power engineering limited and subsidiary implementation.

According to some statistics, Jiangsu kingsun electric limited (hereinafter “the Jiangsu Golden Sun”) were held in tuokexun solar photovoltaic power generation company limited, and the solar power company limited 100% equity; as of day, Wuxi environmental sanitation actual controllers of Bian Qiaofeng Wu Linglin owns 50.17% shares of Jiangsu Golden Sun, controlling shareholders and actual controllers Jiangsu Golden Sun; the associated transactions constitute incidental transactions.

The same day, Ding into Sichuan and its subsidiaries also with Longjing tea machine in new energy technology limited (hereinafter “Longjing”) signed the engineering design and construction contract, the electrical contract, the object of the contract for Longjing 20MW photovoltaic project in engineering design construction and equipment procurement, contract amount in total to 191 million Yuan.

According to available data, Wuxi baby Bo Yuan Technologies Limited (hereinafter “baby Bo”) Longjing tea in the 31.09% stakes. As of day, Bo Bian Qiaofeng baby 70% stakes, legal representative and General Manager of the company, at the same time, father of Wuxi sanitation Director Jiang Qian Bo baby 30% owned by Jiang min, Department supervisor. The associated transactions constitute incidental transactions.

Acquisition plan, Sichuan, Ding said, “up to now, the company has completed more than 100 MW solar photovoltaic power plant development and construction contracting services.”

In an open data, as at report date, Sichuan tripod as close to 60% ‘s business comes from related party transactions with associated enterprises.

Acquisition plan, the original shareholders ‘ commitment, Ding a 2016-2018 realization of Sichuan’s total net profit of not less than 820 million Yuan. Among them, 2016, 2017, 2018 to achieve net profit of not less than 200 million Yuan, 270 million and 350 million Yuan.

Worry is that without the support of related parties, Sichuan tripod can still successfully complete performance pledges?

Profitability is different from peers

Acquisition plan, Sichuan Ding zhongli technology as comparable objects, and spaceflight machine the same photovoltaic power plant EPC business. Compared with listed companies in the same industry, Ding into significant differences in profitability in Sichuan.

In 2014, the technology photovoltaic power plant business revenues 3.133 billion yuan, project operating costs of 2.096 billion yuan, the gross margin would be about 33.1%. PV of technology transfer in Li Tenghui in the business primarily through its subsidiaries.

In 2014, Li Tenghui in a net profit of 156 million Yuan. As a rough calculation, in 2014, the transfer of technology in photovoltaic power plant operational net profit margin is about 4.98%.

In 2015, the technology transfer of PV power plant in 686MW, reported revenue of 5.303 billion yuan, project operating costs to 3.637 billion yuan, company PV business with gross margin of about 31.42%; PV business to achieve a net profit of about 441 million, net interest rate is about 8.32%.

Plans show 2016 1 March, Sichuan top operating cost of 237 million Yuan, the company gross profit margin of about 22.81%; 53.0615 million yuan in net profit, net profit margin is about 17.26%.

Compared with the technology, Sichuan Ding into much lower gross margins, but the company’s net profit margin was significantly higher than that of technology.

Meanwhile, according to the annual report data, 2014-2015, aerospace electromechanical transfer PV 170MW and 290MW respectively. According to the annual report, and spaceflight machine PV power plant EPC business through a subsidiary of Shanghai solar energy science and Technology Limited (hereinafter “Shanghai solar energy”).

Financial data shows, 2014-2015, solar revenues of 2.008 billion yuan respectively in Shanghai and 2.845 billion yuan net profit of 116 million and 69 million Yuan respectively. As a rough calculation, 2014-2015, aerospace electrical photovoltaic power plant EPC project of net profit was about $ 5.78%, and 2.43%.

Compared with the spaceflight machine, Sichuan Ding into profitability is surprising.

In addition, it is worth mentioning is, according to technology and spaceflight machine in disclosing data calculation, under normal circumstances, revenue per 1MW in 7.5 million to 12 million Yuan.

Plan, Sichuan, Ding said, up to now, the company has completed more than 100 MW solar photovoltaic power plant development and construction contracting services.

By this calculation, as at report date, Sichuan Ding into realized revenue should be at least 700 million Yuan. But the financial data shows, 2016 1 March, Ding into Sichuan realize the amount of revenue just for 307 million Yuan, the company’s revenue recognition worthy of attention.

Original title: ST cloud network transboundary PV NET myth surprise

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