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Six agencies warm tips: Dongxu photoelectric rating was downgraded, Fuyao Glass overseas expansion uncertainty

Author|Wei Xinquan

In this issue, the anti-short-selling research center observed that six major domestic rating companies, released 19 companies' credit rating reports, these reports, in addition to Dongxu photoelectric rating was downgraded, the other companies' ratings and the last ratings to maintain consistency, but from the ratings companies to give the risk of prompts, the listed companies last week's risk prompts can be described as step by step alarming. Some companies with business income overseas, or raw materials from overseas companies, such as Fuyao Glass, Weapon Industry Group, Liu Steel Group, etc., was focused on risk.

From these rating reports, the business is mainly in the domestic enterprises, due to the impact of the epidemic, operating income and operating profit in the decline, but accounts receivable and inventory, debt in the rise, giving a heavier sense of crisis. However, there are also some companies that are seeing a rise in both revenue and profit, which is certainly a good sign.

Credit rating: Fuyao glass expansion of overseas business uncertainty

On July 27, China Chengxin International Credit Rating Company Limited ("CCCR") released its report on Fuyao Glass Industry Group Co. ("Fuyao Glass"). The main credit rating is AAA, and the debt credit rating of "20 Fuyao Glass MTN002" is also AAA, which is consistent with the last rating (April 17, 2020), and the rating outlook is stable. The debt credit rating of "20 Fuyao (Epidemic Prevention and Control Debt) MTN001" is AAA, consistent with the last rating (July 1, 2019).

Fuyao Glass is a listed company engaged in the production and sale of glass, and it has a significant industry position as the largest supplier of automotive glass in China. Data show that Fuyao Glass's operating income in 2019 was 21.104 billion yuan, an increase of 879 million yuan compared with 2018, while the revenue of its overseas business in 2019 was 10.188 billion yuan, an increase of 22.57% compared with 2018. In terms of market net profit, it was $2.898 billion in 2019, $1.209 billion less than in 2018. In terms of market share, the company's domestic automotive glass market share is over 65% in 2019 and about 23% globally. In terms of debt, as of the end of March 2020, its gearing ratio was 47.61%, total bank credit was 39.673 billion yuan, and the unused credit balance was 26.901 billion yuan.

China Chengxin pointed out that Fuyao Glass's overseas business expansion is uncertain due to the deterioration of the overseas investment environment in 2019 as a result of intensified global trade protectionism, continued fluctuations in the RMB exchange rate, and the intensification of the trade conflict between China and the United States. And at home, since 2019, auto sales have been in a downward trend, leading to a decline in demand for automotive glass, and this year, all segments of the automotive industry have been greatly affected by the epidemic, exacerbating the difficulty of selling automotive glass and affecting operating income, and the net profit of its market is yet to be improved.

Credit: Zhenshi Group's asset liquidity is tight, facing the pressure of repayment and overseas business risks

On July 27th, CITIC released its rating report on Zhenshi Group Co. The main credit rating and the last rating (July 26, 2019) are both AA, and the rating outlook is stable.

Zhenshi Group is a listed company mainly engaged in the production and sale of stainless steel, with strong regional competitive advantages. Information shows that in 2019, Zhenshi Group's operating income was 13.159 billion yuan, 1.381 billion yuan more than in 2018; net profit was 1.018 billion yuan, 111 million yuan more than in 2018. The 310S and 309 heat-resistant steel produced by the company accounts for about 50% of the Wuxi hot-rolled market, and 316L accounts for 20% of the Wuxi market.

Zhenshi Group is the second largest shareholder of China Jushi Corporation (known as "China Jushi"), which is the world's leading manufacturer of fiberglass yarns, and the latter has brought Zhenshi Group a large investment benefit.

On the debt side, as of the end of March 2020, Zhenshi Group*** had a bank credit line of 9.023 billion yuan, with an unused line of 744 million yuan. However, its total debt was 9.858 billion yuan and short-term debt was 7.583 billion yuan. China Chengxin pointed out that Zhenshi Group will face certain repayment pressure, and the debt structure needs to be optimized.

In terms of liquidity, due to the increasing scale of receivables, as of the end of March 2020, Zhenshi Group's restricted assets totaled 6.944 billion yuan, accounting for 28.95% of total assets. China Chengxin pointed out that Zhenshi Group's receivables mainly come from the current payment of related parties, which forms a certain occupation of funds.

In terms of overseas projects, as of the end of March 2020, its major overseas projects under construction include Yashi Indonesia ferronickel production project and Widabe industrial park project. Its overseas projects are subject to risks associated with overseas political, legal and exchange fluctuations and the overseas spread of the New Crown Pneumonia epidemic.

China Sincere: China Mengniu is at risk of goodwill impairment if its overseas acquisitions do not perform up to standard

On July 28, China Sincere released its rating report on China Mengniu Dairy Co. The main credit rating of China Mengniu is AAA, and the debt credit rating of "19 Mengniu MTN001" is AAA, both consistent with the results of the last rating (November 4, 2019), and the rating outlook is stable.

The data show that in 2019, China Mengniu's annual dairy production capacity reached 9.5 million tons/year, ranking among the top 10 globally for the third consecutive year; its operating revenue was 79.030 billion yuan, up 14.57% year-on-year from 2018; its annual profit was 4.296 billion yuan, up 31.90% year-on-year from 2018; and in terms of product share, the ambient and low-temperature categories of its liquid milk products had a domestic market share of 27.2% and 23.5% respectively.

In terms of access to capital, China Mengniu, as a listed company, has relatively unimpeded financing channels, and its total credit obtained in 2019 amounted to 50.448 billion yuan, with an unused credit line of 34.787 billion yuan. China Chengxin believes that China Mengniu's debt in the U.S. dollar, Hong Kong dollar and other foreign currency borrowing scale is large, or face a certain risk of exchange rate fluctuations.

China Chengxin pointed out that China Mengniu by the end of 2019 it completed the acquisition of all the shares of the Australian dairy company Bellamy's Australia Limited ("Bellamy"), and intends to acquire the shares of Lion-Dairy&DrinksPty Ltd ("LDD"), which is the largest dairy company in the world. ("LDD"). Due to the large scale of its acquisition, if the operating results can not meet expectations, it will face goodwill impairment.

CITIC: Some products can't be sold due to the policy impact, and the short-term debt of China National Heavy Duty Truck is too much to be optimized

On July 28, CITIC released its rating report on China National Heavy Duty Truck Group (CNHDC). The main credit rating is AAA, and the debt credit rating of "19 Heavy Duty Truck CP001" is A-1, which is consistent with the last rating (March 9, 2020), and the rating outlook is stable.

China National Heavy Duty Truck Corporation (CNHTC) is one of China's leading heavy-duty truck manufacturers with a significant industry position, ranking third in the industry with a 16.26% market share of heavy-duty trucks over 14 tons in 2019. Its business also involves real estate development and financial sectors, diversifying its business areas and enhancing its overall risk resistance. In terms of financing, it has a strong ability to obtain cash, with a net cash flow from operating activities of 10.244 billion yuan in 2019, an increase of 37.82% over 2018, and in terms of bank credit, as of the end of March 2020, the total amount of credit granted was 70.626 billion yuan, and the unused amount was 53.899 billion yuan.

In terms of debt, as of the end of March 2020, its short-term debt was 20.188 billion yuan, accounting for as much as 84.30% of the total debt, and its debt servicing pressure is greater, and the debt structure also needs to be optimized. Due to the impact of the national regulation of "large tons and small standards", some of the light truck models produced by the company stopped production and sales, which led to a decline in light truck sales, and also affected its operating income.

China Sincerity: Increase in period expenses erode profits, more new categories of Tsingtao Brewery Group's good days are over

On July 28, China Sincerity released a rating report on Tsingtao Brewery Group Co. The main credit rating of Tsingtao Brewery Group is AAA, which is consistent with the last rating result, and the rating outlook is stable.

Green Beer Group has a market share of over 50% in Shandong, Shanxi and other provinces, and it has 15,850 distributors nationwide as of the end of 2019; operating revenue of 28.665 billion yuan, an increase of 4.85% year-on-year in 2018; net profit of 1.994 billion yuan, an increase of 28.63% year-on-year in 2018; and net cash flow from operating activities of 5.102 billion yuan< /p>

from 4.672 billion yuan in 2018. As of the end of March 2020, it*** was granted a total of 22.450 billion yuan of credit, of which 21.419 billion yuan was unused. It can raise funds through its subsidiary Tsingtao Brewery Company Limited ("Tsingtao Brewery"), which is listed on the A+H stock market.

The data show that in 2019, Tsingtao Brewery Group's period expenses were 6.633 billion yuan; in the first quarter of 2020, revenue and earnings are in a downward phase. China Chengxin pointed out that the high scale of Qingdao Beer Group's period expenses has formed a certain degree of erosion of profits, and the degree of competition in the beer industry has further intensified with the entry into the market of imports, craft brewing and other new categories of beer.

CITIC: The performance will be affected by the policy of speed and fee reduction, 5G to increase the pressure on China Unicom's expenditure

July 29, CITIC released its rating report on China Unicom (referred to as "China Unicom"). This time, the main credit rating of China Unicom is AAA, and the credit rating of "19 Unicom MTN001" is also AAA, which is consistent with the results of the last rating (November 7, 2019), and the rating outlook is stable.

In 2019, China Unicom's net profit was 10.26 billion yuan, an increase of 21.22% compared with 2018; net cash flow from operating activities was 95.112 billion yuan, an increase of 0.39 billion yuan compared with 2018.Since 2019, the state and relevant ministries and commissions have repeatedly proposed to accelerate the construction of 5G networks, data centers and other new infrastructures, which has provided Unicom's operating companies with a more good external environment.

China Chengxin pointed out that the scope of competition among the three largest domestic business operators has expanded, intensifying the degree of competition in the industry. China Unicom's performance will be affected by policies related to the communications industry, as well as policies such as speed up and fee reduction. With the increasing investment in infrastructure network construction and 5G business layout, China Unicom will face certain capital expenditure pressure.

CITIC: The shares held by the controlling shareholder were judicially frozen, and the credit rating of Dongxu Optoelectronics was downgraded

On July 30th, CITIC released its rating report on Dongxu Optoelectronics Technology Company Limited (Dongxu Optoelectronics). This time, the main credit rating of Dongxu Optoelectronics is c. The debt credit ratings of "16 Dongxu Optoelectronics MTN001A" and "16 Dongxu Optoelectronics MTN002" are also consistent with the results of the last rating (on December 3, 2019), but

As of the end of 2019, the book value of Dongxu Photoelectric's restricted assets is 24.115 billion yuan, and its controlling shareholder Dongxu Group pledged the number of the company's shares 799.6 million shares, accounting for 87.39% of its shareholding, and has been judicially frozen; since November 2019, Dongxu Photoelectric has had a number of bond defaults, and the current amount of bond defaults, funding litigation and other amounts totaling 5.151 billion yuan.

In terms of operating income, Dongxu Photoelectric's total operating income in 2019 was 17.529 billion yuan, a decrease of 10.683 billion yuan compared with 2018, and the net profit fell to - 1.558 billion yuan, a decrease of 3.827 billion yuan compared with 2018, and the net cash flow from operating activities was - 3.013, a decrease of 3.172 billion yuan compared with 2018.

China Chengxin pointed out that because Dongxu Optoelectronics assets liquidity is tight, profitability is declining, the internal fund management control system is not effectively implemented, there are significant deficiencies, and subsidiaries' external guarantees are large and do not fulfill the decision-making procedures in accordance with the relevant provisions of the company, so Zhongxingcai Guanghua Accounting Firm (Special General Partnership) ("Zhongxingcai") has issued an opinion on its 2019 annual report. ") issued an adverse opinion on its internal control for the year 2019. In addition, it received a regulatory letter from the Exchange for its failure to accurately disclose material information as well as its failure to respond to the Shenzhen Stock Exchange's inquiries within the prescribed period.

CITIC: CombiPharma's control may change, and there is a possibility of not being able to recover the money accounted for by the related parties

On July 31st, CITIC released its rating report on CombiPharma Corporation (CombiPharma). This time, the main credit rating of Kangmei Pharmaceutical is C. "17Kangmei MTN001", "17Kangmei MTN002", "17Kangmei MTN003", "18Kangmei MTN001", "18Kangmei MTN002", "18Kangmei MTN003", "18Kangmei MTN004" and "18Kangmei MTN005" are also rated CC, consistent with the results of the last rating (February 3, 2020), CSCI said. China Chengxin said that the above bonds of Kangmei Pharmaceutical are included in the watch list for possible downgrade.

Kangmei Pharmaceutical is a listed company engaged in the production and sale of Chinese medicine, and has formed an integrated operation model and business system for the whole industry chain of Chinese medicine. Its production of TCM tablets has high market recognition and its TCM tablets business is in the leading position in the industry.It has 11 production bases in China, which can produce more than 1,000 types of products with more than 20,000 product sizes.At the end of 2019 it signed a Stock Loan Syndication Contract with 13 banks for a loan of 10.048 billion yuan, which has effectively alleviated the pressure of short-term debt repayment.

China Chengxin pointed out that, because of the imperfect internal governance of Kangmei Pharmaceuticals, there are significant deficiencies in internal control, in 2019, Lixin Accounting Firm (Special General Partnership) ("Lixin Firm") issued a negative audit report on the internal control of its financial report. In addition, it has a large scale of funds occupied by related parties, with funds occupied by related parties*** amounting to RMB 9.481 billion in 2019, and there is a risk of not being able to recover the funds in a timely manner.

United Credit Suisse: Undistributed profit is high, and Lingyun's operating pressure is increasing

On July 27, United Credit Suisse announced that it had issued a negative audit report on Lingyun Industrial Co. ("Lingyun") on July 27th. This time, the main credit rating of Lingyun is AA+, and the debt credit rating of "18 Ling Industrial MTN001" is also AA+, which is consistent with the result of the last rating (July 18, 2019), and the rating outlook is stable.

Lingyun is a listed company engaged in the production and sales of automotive parts and plastic pipe systems, and China National Weapons Industry Corporation is its de facto controller. In terms of credit, as of the end of March 2020, it*** has obtained credit lines of 6.494 billion yuan, of which 4.118 billion yuan has not yet been used; its total debt in 2019 is 4.344 billion yuan, of which short-term debt accounts for as much as 71.38%.

United Credit Union pointed out that by the impact of the decline in domestic auto sales, auto parts demand has also declined, Lingyun shares will face a certain degree of operating pressure, but also will face heavier repayment pressure, its debt structure to be optimized.

United Credit Suisse: Accounts receivable and inventory occupy a lot of funds, Weigao Group's debt burden is very heavy

On July 30, United Credit Suisse released its rating report on Weigao Group Limited (referred to as "Weigao Group"). This time, the main credit rating of Weigao Group is AA+, and the debt credit rating of "20 Weigao (Epidemic Prevention and Control Bond) MTN001" is AA+, which is consistent with the result of the last rating (April 2, 2020); "19 Weigao MTN001 " has a debt credit rating of AA+, consistent with the result of the last rating (June 2, 2019), and the rating outlook is stable.

Weigao Group, a company mainly engaged in the production and sales of disposable medical devices and pharmaceuticals, with its business involved in healthcare and real estate, is the largest producer of input devices and syringes in China, and its irradiated syringe products have a 100% market share in the domestic market; and its TPE infuser products have as high as 85% of the high-end infuser market. The company's 2019 revenue was 20.041 billion yuan, up 11.03% year-on-year; net profit was 2.472 billion yuan, down 148 million yuan year-on-year; and operating cash flow was 4.653 billion yuan, up 145.41% year-on-year.

In 2019, Weigao Group's accounts receivable and inventory*** amounted to 15.34 billion yuan, which formed a certain amount of its capital; its period expenses were 8.063 billion yuan, up 23.70% year-on-year; and its total debt was 24.127 billion yuan, up 9.31% year-on-year. As of the end of March 2020, its interest-bearing debt was 25.429 billion yuan, an increase of 5.40% compared with the end of 2019; in addition, its external guarantee involves an amount of 436 million yuan, and most of the guarantee objects are Shandong private enterprises.

United Credit Union pointed out that Weigao Group has a large scale of accounts receivable and inventory, the scale of debt continues to increase, the debt burden is heavy, and there is a risk of contingent liabilities due to the issue of external guarantees.

United Credit Suisse: Overseas strategic areas of political turmoil, Hydrocarbons Industry Group overseas business risk

July 31, United Credit Suisse released its rating report on China National Weapons Industry Group Corporation (hereinafter referred to as "Hydrocarbons Industry Group"). This time, the main credit rating of the Hydrocarbons Industry Group is AAA, and the debt credit rating of "16 Hydrocarbons MTN001" and "15 Hydrocarbons MTN001" is AAA, which is consistent with the results of the last rating (July 19, 2019), and the rating outlook is stable.

Arms Industry Group's 2019 operating revenue was 474.710 billion yuan, up 4.34% year-on-year; total profit was 17.810 billion yuan, up 7.03% from 2018; and net operating cash flow was 28.669 billion yuan, up 53.74% from 2018. However, United Credit Union pointed out that the Hydrocarbons Industry Group will face certain overseas business risks.

It is reported that the revenue of the overseas strategic resources business of the Hydrocarbons Industry Group in 2019 was 2005.57 billion yuan, accounting for 42.25% of the operating income in the same year, and its overseas strategic resources business focuses on the Middle East, Africa and other regions, which have poorer political and economic stability, so its related business has a certain degree of operational risk. In addition, its subordinate civil products enterprises involved in more areas, the adjustment of the enterprise product structure, will lead to related business face more intense market competition.

United Credit: Xinxing Jihua Group has good operating cash flow, but there is operating pressure

On July 28, United Credit Rating Co. (hereinafter referred to as "Xinxingji Hua Group"). This time, the main credit rating of Xinxingji Group is AAA, and the debt credit rating of "20 Xinji Y2" is also AAA, which is consistent with the result of the last rating (March 10, 2020); the debt credit rating of "20 Xinji Y1" is consistent with the result of the last rating (February 25, 2020); and the debt credit rating of "20 Xinji Y1" is AAA. rating (February 25, 2020) results, both AAA; "18 New Inter Y5", "18 New Inter Y3", and "18 New Inter Y3", "18 New Horizons Y2", "18 New Horizons Y1", "17 New Horizons Y2", "17 New Horizons Y1 " debt credit ratings are consistent with the results of the last rating (20 XinXinJiHua Group 19 June 19), all of which are AAA, and the rating outlook is stable.

The main businesses of Xinxingji Group include metallurgy and casting, light industry and textile, equipment manufacturing and trade and logistics. As of the end of 2019, the company had total consolidated assets of 130.934 billion yuan, total liabilities of 76.965 billion yuan, and owner's equity (including minority interests) of 53.969 billion yuan, of which 33.440 billion yuan was attributable to the owner's equity of the parent company.In 2019, the company realized operating income of 140.267 billion yuan, and net profit (including minority interests and losses) of 2.257 billion yuan of which, net profit attributable to owners of the parent company is 1.370 billion yuan; net cash flow from operating activities is 8.077 billion yuan, and net increase in cash and cash equivalents is 4.383 billion yuan.

United Credit noted that Xinxingji Group has a good operating cash flow position, with unrestricted funds of 22.761 billion yuan at the end of 2019 and unused credit lines of 103.018 billion yuan. Its light industry textile business has some operating pressure due to increased market competition and thus its metallurgical casting business will be affected by cyclical changes in the steel industry.

New Century: Overseas raw materials are at risk, the project under construction pressures funds, Liuzhou Iron and Steel Group has a large expenditure pressure

On July 29, New Century Credit Appraisal and Investment Services Co. ("Liuzhou Iron and Steel Group"). The main credit rating of Liuzhou Iron and Steel Group and the debt credit rating of "20 Liuzhou Iron and Steel Group MTN001" are both AAA, consistent with the results of the last rating (November 15, 2019), and the rating outlook is stable.

In addition, the debt credit rating of "19 Liu Steel Group MTN002" is AAA, consistent with the result of the last rating (August 21, 2019), and the debt credit rating of "19 Liu Steel Group MTN001" is AAA, consistent with the last rating (July 29, 2019) result.

Liu Gang Group is currently the only listed enterprise of large-scale iron and steel in Guangxi, with its core business of iron and steel, and also develops businesses such as energy and chemical products, trade and real estate, etc. In 2019, it was granted 1.4 billion yuan of capital increase by shareholders. Its operating cash flow is good, its operating cash flow in 2017 - 2019 is 7.682 billion yuan, 7.894 billion yuan, 7.522 billion yuan, respectively, and its bank credit lines as of the end of March 2020 totaled 60.589 billion yuan, with an unused line of 28.303 billion yuan.

New Century pointed out that because Liu Steel Group needs iron ore dependent on outsourcing and mainly from imports, susceptible to the fluctuation of international iron ore prices, since 2019, the price of imported iron ore has climbed significantly, resulting in Liu Steel Group's operating costs, the future will also face the risk of fluctuations in the price of raw materials; in the context of the project in progress, the newly consolidated Eleven Metallurgical Company had an unfinished contract on hand at the end of 2019 amounting to 10.611 billion yuan, the company is engaged in the building construction business model needs to advance funds, will be its funds will form a certain occupation; as of the end of March 2020 has accumulated investment of 13.642 billion yuan, the next two years to invest 33.065 billion yuan, will face a greater pressure of capital expenditure.

In terms of litigation, as of the end of 2019, it is involved in more lawsuits, the funds involved *** counted 0.22 billion yuan.

New Century: most of the credit line has been used up, General Technology still needs a large sum of money

On July 30, New Century Appraisal announced its rating report on China General Technology (Group) Holding Company Limited ("General Technology"). This time, the main credit rating of General Technology is AAA, and the debt credit ratings of "16General 01", "16General 02" and "18General 01" are AAA, which is the same as that of the last rating (June 27, 2019), which was issued by New Century Appraisal. the results of the last rating (June 27, 2019) and the outlook is stable.

General Technology's business can be categorized into three major segments, namely advanced manufacturing and technical services, pharmaceuticals, medical and healthcare, and trading and engineering contracting, with a number of listed subsidiaries, with operating revenue of 183.276 billion yuan in 2019, an increase of 7.58% compared with 2018; net profit of 5.380 billion yuan, an increase of 9.39% compared with 2018; and operating cash flow of -2.426 billion, an increase of 267 million yuan from 2018.From 2017-2019, General Technology received political subsidies of 390 million yuan, 277 million yuan, and 354 million yuan, respectively. As of the end of 2019, the company*** was granted a credit line of 189.987 billion yuan, with an unused credit line of 87.420 billion yuan.

New Century pointed out that General Technology's commodity trading and international engineering contracting business is easily affected by the international political, economic and trade situation; as the building construction business is affected by the slow process of project payback, it has formed a tie-up of its capital and weakened its capital liquidity. With the growth of the company's financial leasing business, the future demand for capital is greater, and will face a certain amount of capital pressure; its business synergies between the segments is not high, and will also face a certain amount of management pressure.

Dagong International: Liabilities of nearly 55 billion, and 67.6 billion bills, itai group payment pressure

July 27, Dagong International Credit Rating Company Limited (referred to as "Dagong International") released its Inner Mongolia Yitai Group Co. ("Itai Group") on July 27, 2012. The main credit rating of Itai Group and the debt credit rating of "18 Itai MTN001" are both AA+, consistent with the previous rating (June 24, 2019), and the rating outlook is stable.

Itai Group is the largest local coal enterprise in Inner Mongolia, because Itai Chemical-1.2 million tons of fine chemicals project all put into production, coal chemical business revenue increased significantly, coal chemical business revenue in 2019 increased by 98.69% compared with 2018, but the company's other receivables is 11.030 billion yuan, owner's equity is 45.842 billion yuan, and minority interests accounted for 57.60%.

As of March 2020, the company's interest-bearing debt was 54.753 billion yuan, accounting for 85.23% of all liabilities; important projects under construction are planned to invest 83.342 billion yuan, with a cumulative investment of 15.648 billion yuan, and still need to invest 67.694 billion yuan, of which 791 million yuan is to be invested in 2020. The amount of external guarantee is 1.169 billion yuan, the guarantee object is local enterprises, the guarantee area is more concentrated, or face certain guarantee risk. Dagong International pointed out that Yitai Group has higher liabilities, and the amount of future expenditures required is still relatively large, so the company has a certain expenditure risk.

Dagong International: Salt Lake Industry Turns Losses Into Profits, Credit Rating Included in the Watch List

On July 28th, Dagong International released an announcement about the credit rating of Qinghai Salt Lake Industry Co. This time, the main credit rating of Salt Lake Industry and the debt credit rating of "15 Salt Lake MTN001" and "16 Qinghai Salt Lake MTN001" are BB, consistent with the results of the last rating (December 4, 2019), and they are all placed on the credit rating watch list. Credit Rating Watch List.

The announcement indicated that Gelmu Taishan Industry Company Limited ("Taishan Industry") applied to Xining Intermediate Court on August 15, 2019 for the reorganization of Salt Lake shares on the ground that Salt Lake Industry was unable to pay 4.39 million yuan of debts on maturity. Salt Lake shares in strict accordance with the Reorganization Plan.In the first half of 2020, the net profit attributable to listed shareholders of Salt Lake Industry realized a turnaround. Dagong International maintains the credit rating of Salt Lake Industry and also continues to include it in the credit rating watch list.

Dagong International: shareholders' funds occupation scale, heavy debt burden of Jinsiyuan Group

July 30, Dagong International released its rating report on Jinsiyuan Group Co. This time, the main credit rating of JINSHIYUAN GROUP and the debt credit rating of "16JINSHIYUAN MTN001", "17JINSHIYUAN MTN001", "17JINSHIYUAN MTN002" are all at A debt credit ratings are all AA, consistent with the results of the last rating (July 24, 2019), and the rating outlook is stable.

JINSHIJIAN GROUP is a listed company engaged in the production and sale of liquor.In 2019, its operating revenue was 4.882 billion yuan, an increase of 30.22% compared with 2018; net profit was 1.376 billion yuan, an increase of 28.47% compared with 2018; operating cash flow was 1.317 billion yuan, an increase of 18.12% compared with 2018; and invested in R&D capital was 4.882 billion yuan, accounting for 29% of operating income. As of March 2020, it has authorized 24 invention patents; and 32 utility model patents.

The Grand Duke International pointed out that JINSHIYAN's liquor sales area is mainly in Jiangsu Province, its debt scale is larger, the debt burden is heavier, at the end of March 2020 its total liabilities amounted to 4.809 billion yuan. Other receivables are large, of which the receivables from shareholder Jiangsu Andong Holding Group Co. are 2.183 billion yuan, accounting for 72.10% of other receivables, which creates a certain amount of capital occupation and weakens the liquidity of funds.

Dongfang Jincheng: Facing the pressure of repayment and investment expenditure, Gujia Group is also facing the risk of goodwill impairment

On July 27, Dongfang Jincheng International Credit Appraisal Co. ("Gujia Group"). This time, the main credit rating of Gujia Group and the debt credit rating of "19 Gujia MTN001" are both AA, consistent with the results of the last rating (July 29, 2019), and the rating outlook is stable.

In 2019, Gujia Group's output of home furnishing products was 2,856,500 standard sets, an increase of 62.93% compared with 2018; operating income was 15.995 billion yuan, an increase of 56.97% compared with 2018; total profit was 818 million yuan, a decrease of 108 million yuan compared with 2018; and the company has owned its own branded stores has exceeded 4,518, an increase of 296 stores compared with 296 in 2018, covering more than 30 provinces and regions across the country. The company also has 1,059 research and development personnel, accounting for 7.75% of its total headcount; R&D investment of 198 million yuan, an increase of 44.61% over 2018.

The data show that at the end of 2019, Gujia Group's other receivables amounted to 2.095 billion yuan, of which 1.042 billion yuan was involved in the funds involved in the related parties of the top five other receivables objects, which will face a certain amount of pressure to recover; its total debt was 7.729 billion yuan, of which 4.163 billion yuan was short-term interest-bearing debt, which will face a certain amount of pressure to repay; since 2018 carried out a number of acquisitions, if the acquired enterprise business industry can not meet expectations, it will face the risk of goodwill impairment; its main projects under construction plan a total investment of 4.535 billion yuan, has been invested in the cumulative investment of 1.214 billion yuan, and in the future to be invested in the future of 3.321 billion yuan, there is a pressure of investment expenditure.

Oriental Jincheng: receivables and prepayments accounted for more than 50%, Jizhong Energy Group funds are seriously occupied

July 30, Oriental Jincheng released its rating of Jizhong Energy Group Co. ("Jizhong Energy Group"). This time, the main credit rating of Jizhong Energy Group is AAA, consistent with the results of the last rating (May 8, 2020), and the rating outlook is stable.

In addition, a number of debt ratings of Jizhong Energy Group are also consistent with the results of the last rating, including the debt credit rating of "20 Jizhong Energy CP005" is A-1, "20 Jizhong Energy CP004" is A-1; "20 Jizhong Energy CP004" is A-1; and "20 Jizhong Energy CP005" is A-1. The debt credit rating of "20 Jizhong Energy MTN002" is AAA; the debt credit rating of "20 Jizhong Energy CP003" is A-1; the debt credit rating of "20 Jizhong Energy CP002" is A-1; the debt credit rating of "20 Jizhong Energy CP003" is A-1; the debt credit rating of "20 Jizhong Energy CP003" is A-1. The debt credit rating of "20 Jizhong Energy CP003" is A-1; the debt credit rating of "20 Jizhong Energy CP002" is A-1; the debt credit rating of "20 Jizhong Energy MTN001" is AAA; the debt credit rating of "20 Jizhong Energy CP001" is A-1; The debt credit rating of "19 Jizhong Energy CP009" is A-1; the debt credit rating of "19 Jizhong Energy CP010" is A-1; "19 Jizhong Energy MTN004B The debt credit rating of "19 Jizhong Energy MTN004B" and "19 Jizhong Energy MTN004A" is AAA; the debt credit rating of "19 Jizhong Energy MTN003" is AAA;" 19 Jizhong Energy MTN002" has a debt credit rating of AAA.

Jizhong Energy is a large-scale coal development group, and its business covers a wide range of fields such as coal, logistics and trade, chemicals, pharmaceuticals, etc. In 2019, the group produced 28,370,800 tons of coal from its mines in Hebei Province, which accounted for 55.90%; as of the end of 2019, it had 11.197 billion tons of coal geological reserves (excluding local hosted coal mines) and 4.241 billion tons of recoverable reserves. Its subsidiary North China Pharmaceutical is one of the largest antibiotic production bases in China.

In 2019, its operating revenue was 211.855 billion yuan, a decrease of 10.35% compared with 2018; total profit was 2.003 billion yuan, an increase of 26.05% compared with 2018, and operating net cash flow was 3.061 billion yuan, an increase of 149.43% compared with 2018. Among them, due to the growth of coke and methanol sales, its chemical business revenue of 11.865 billion yuan, an increase of 9.90% over 2018; with the transformation and adjustment of the product structure to high-margin preparation drugs, the profitability of the pharmaceutical business is growing faster, and the revenue of the pharmaceutical business in 2019 is 13.465 billion yuan, an increase of 49.18% over 2018.

Oriental Jincheng pointed out that at the end of 2019, Jizhong Energy's receivables and prepayments accounted for more than 50% of the company's current assets, and the scale of receivables and prepayments was large, which formed a tie-up of its funds; the money funds were 23.389 billion yuan, and the short-term interest-bearing debt was 104.384 billion yuan, and its money funds could not fully cover the short-term interest-bearing debt, and it would face a certain amount of concentrated pressure on debt repayment. . Affected by the epidemic, its overall profitability may decline in 2020.