Although PTA prices have continued to hover at low levels in recent years, the enthusiasm of related companies to invest in and build new production capacity has not diminished.
Hengli Petrochemical invested more than 10 billion to build PTA production capacity
On the evening of September 30, Hengli Petrochemical (600346) announced that in order to further consolidate upstream production capacity The advantages of scale will enhance the comprehensive competitiveness of the entire polyester chemical fiber industry chain and enhance the sustainable profitability of listed companies. The company’s subsidiary Hengli Petrochemical (Huizhou) Co., Ltd. (hereinafter referred to as “Hengli Petrochemical (Huizhou)”) plans to invest 11.495 billion yuan in construction. “2×2.5 million tons/year PTA project”.
According to disclosures, the project is planned to be completed and put into operation by the end of 2021. It will mainly build two sets of PTA main devices, a 50,000-ton bulk cargo terminal, a sewage treatment plant, a gas boiler, a circulating water station, and a storage and transportation tank area. , comprehensive power station, reclaimed water reuse, methanol hydrogen production, hydrogen recovery system, desalted water station, fire water station, finished product warehouse, etc. The project adopts industry-leading green and intelligent PTA production technology, which is energy-saving and environmentally friendly, has low energy consumption, low material consumption, safe and stable operation, high reliability, 80-100% operational flexibility, and an annual production capacity of 5 million tons of PTA.
The investment of 11.495 billion yuan includes an investment of 9.9 billion yuan in project construction (including US$120 million in foreign exchange). The company will use 3.18 billion yuan of its own funds and apply for loans from banks for the rest.
As the leader in the PTA industry, Hengli Petrochemical has a total PTA production capacity of 11.6 million tons per year. It is the only PTA production supplier in the world with the largest production capacity, the most advanced technology and the most obvious cost advantages and the only one in the industry. A company with an equity production capacity of over 10 million tons. After the completion of this project, the PTA production capacity of the listed company will increase to 16.6 million tons/year.
The announcement stated that this investment will help the listed company further strengthen its technology, scale and cost competitiveness in the upstream PTA industry of the polyester chemical fiber industry chain, optimize the entire industry chain structure, consolidate its leading edge in upstream production capacity, and enhance The company’s comprehensive competitive strength. After the project reaches production and results, it is expected that the average annual sales revenue will be 21.25 billion yuan and the total profit will be 1.206 billion yuan.
At the same time, this project is located in Huizhou Daya Bay Petrochemical Park, one of the seven key petrochemical industry bases in my country and the largest refining and chemical integration scale in the country. The park’s circular economy industry chain is highly relevant. After the completion of this project, it will be of great significance to fill the shortcomings in the middle and lower reaches of the petrochemical industry chain in Huizhou and even Guangdong, improve the industrial structure, and help Huizhou Daya Bay Petrochemical Park build a trillion-level petrochemical energy new materials industry cluster.
PTA prices continue to hit new lows, and industry investment enthusiasm remains unabated
The PTA industry is mainly affected by the upstream petrochemical industry, downstream polyester industry, and even terminal weaving, The demand and development conditions of many industries, including the automobile industry, show certain cyclical characteristics.
In the domestic futures market, the price of the main PTA contract 2101 exceeded a high of 12,576 yuan/ton in early 2011, and has shown a downward trend in the past ten years. After entering 2020, affected by the global COVID-19 epidemic at the beginning of the year, domestic PTA futures prices quickly fell below the bottom of the 2008 financial crisis. Overall, PTA dropped from 5,060 yuan/ton at the beginning of the year to a low of 3,278 yuan/ton at the end of April, and has maintained low prices in recent months.
However, given the previous plunge in international oil prices, the cost pressure on PTA is still small. Processing profits can still be maintained at the current low prices, and the investment enthusiasm of industrial capital continues to rise.
Before Hengli Petrochemical announced its large investment on the evening of September 30, Sanfangxiang (600370), which had changed its main business through the successful acquisition of Jiangsu Hailun Petrochemical Co., Ltd. (hereinafter referred to as “Hailun Petrochemical”) in recent years It was also announced on September 29 that in order to develop and improve its own “PTA-bottle grade polyester chips” integrated industrial chain layout, its wholly-owned subsidiary Hailun Petrochemical plans to invest in the construction of a PTA technical transformation and expansion project with an annual output of 3.2 million tons. The total investment of the project is expected to be 4.515 billion yuan.
Against the backdrop of accelerated production capacity layout, the market outlook for PTA prices is still not optimistic.
Xia Ting, an analyst at SunSirs, said that in terms of PTA devices, Reignwood Petrochemical’s 1.4 million-ton PTA device began to reduce the load by 50% on September 16 and overhaul the other half of the production capacity, and PTA prices have received certain support. However, Yisheng Ningbo’s 2.2 million tons PTA unit is about to restart, and new production capacity is also planned to be put into operation. Excess expectations continue to put pressure. The cost side of PTA has been supported by the rise in crude oil. However, some of its own devices are currently scheduled to restart, and downstream polyester production and sales are poor. The market trading atmosphere is dull. It remains to be seen whether terminal consumption capacity can continue to improve. It is expected that the short-term PTA market will fluctuate and run weakly, and we still need to pay attention to the changes in crude oil and equipment in the future.
Cinda Futures also recently stated that a PTA device is planned to be put into operation in the fourth quarter of 2020. The production plan will be completed as scheduled by the end of the year, and the annual PTA production capacity is expected to increase to 62.755 million tons. The drop in international oil prices has put less pressure on PTA costs. This has resulted in domestic PTA processing profits still remaining at 608 yuan/ton, and PTA manufacturers are less willing to overhaul their equipment. PTA inventory pressure is expected to increase further in the fourth quarter. At present, there is room for compression of PTA price profits, the market is likely to continue to be depressed, and the overall trend of futures prices is expected to be weak.
More than 1.6 billion yuan purchased properties owned by the actual controller
While Hengli Petrochemical invested heavily in building PTA production capacity, it also planned to purchase properties owned by the actual controller real estate.
The company also announced on the evening of September 30 that with the Hengli refining and chemical project, ethylene project, and PTA-4/5 project being put into production one after another, the company’s business scale is expanding day by day. Based on the listed company’s headquarters office and business To meet the needs of innovative research, the company plans to purchase a property located in Dalian held by Hengli Real Estate (Dalian) Co., Ltd. (hereinafter referred to as “Hengli Real Estate”).The total price of the office building and other related properties in Building B of Victoria Plaza (hereinafter referred to as “Victoria”) in Donggang Business District is 1.636 billion yuan.
The counterparty of this transaction, Hengli Real Estate, is a wholly-owned subsidiary of Dalian Henghan Investment Co., Ltd. (hereinafter referred to as “Henghan Investment”). The actual controllers of the company, Chen Jianhua and Fan Hongwei, hold Dalian Henghan Investment Co., Ltd., Hengli Real Estate is a related legal person of the company, and the above transactions constitute related transactions.
The announcement stated that with the smooth operation of Hengli Refining and Chemical’s 20 million tons/year refining and chemical integration project and the smooth and full production of the 1.5 million tons/year ethylene project and PTA-4/5 project, the listed company The scale of assets and performance has grown significantly, and the scale of personnel has expanded rapidly. The listed company’s 20 million tons/year refining and chemical integration project, 1.5 million tons/year ethylene project and PTA project are all located in Dalian Changxing Island Economic Zone. The polyester projects are located in Yingkou, Liaoning, Nantong, Jiangsu, Suzhou, Suqian and other places. Since listing Since then, the company has been focusing on the integration of the upstream and downstream of the industrial chain and business development. It does not have a headquarters building, and relevant purchasing, sales, management and other functional departments are scattered around the country. As the business of listed companies continues to diversify and scale continues to expand, offices in multiple locations at this stage cannot meet the growing needs for management, reception, research, etc., which is not conducive to unified management and efficiency improvement, and affects the subsequent introduction of talents, increasing the operating costs and costs of listed companies. Manage risk. Currently, listed companies purchase a large amount of crude oil. The procurement costs are greatly affected by factors such as the international situation and exchange rate fluctuations. High-end financial talents and international management talents will be introduced in the future. Changxing Island, the main office of the listed company, is about 150 kilometers away from Dalian city. The transportation is not convenient, which is not conducive to attracting high-level management talents and researchers. Therefore, the purchase of a headquarters building will help the company implement its mid- to long-term development plan and improve the company’s hardware facilities in research and development, operation management, and market development. It can enhance the company’s image, improve employee office comfort and satisfaction, and better attract high-end talents.
The listed company currently has a total of 26,506 employees. There are about 12,000 employees in Dalian, including about 4,000 in functional management departments. With the continued investment in refining and chemical projects and the increase in downstream fine chemicals, listed companies will The total number of people in Dalian’s jurisdiction will exceed 25,000, and the number of management departments will exceed 6,000. The total construction area of the assets subject to this acquisition is 75,133.66 square meters. Excluding the 1-4th floor lobby, exhibition and conference reception center, executive offices and reserved area, the per capita area is about 7 square meters, which can meet the company’s medium and long-term office needs.
The transaction amount was 1.636 billion yuan, accounting for 0.94% of the company’s most recent audited total assets and 4.5% of its net assets. The underlying assets are depreciated based on 30 years, and the annual depreciation amount is 54.53 million yuan, accounting for 0.16% of the audited net profit in 2019. Regardless of the proportion relative to the total assets, net assets, or net profit, it is small and has a negative impact on the financial performance of listed companies. Conditions have little impact.
However, as of now, the subject assets of this transaction are still in a mortgage state. The mortgage period is from September 25, 2019 to September 25, 2022, and the relevant release procedures are currently being processed. </p
