Accelerate the layout of new materials Hengli Petrochemical plans to split Kanghui New Materials backdoor listing

On April 14, Hengli Petrochemical Co.
, Ltd.
announced that it plans to spin off its subsidiary Kanghui New Material Technology Co.
, Ltd.
, and realize the reorganization and listing through reorganization with Dalian Thermal Power Co.
,
Ltd.
After the spin-off is completed, Dalian Thermal Power will become the controlling shareholder of Kanghui New Materials, and Hengli Petrochemical will become the controlling shareholder of Dalian Thermal Power
.
If the transaction finally takes place, it means that Kanghui New Materials, a subsidiary of Hengli Petrochemical, will also land in the capital market through a backdoor approach
.

Kanghui New Materials

Kanghui New Material is the main development platform and national high-tech enterprise of Hengli Petrochemical's differentiated, high-performance green environmental protection film and new plastic materials
.
In recent years, Kanghui New Materials' industry competitiveness in the field of mid-to-high-end functional films and new plastic materials has continued to improve, ranking among the first-class domestically
.

At present, Kanghui New Materials has an annual production capacity of 240,000 tons of PBT engineering plastics in its Yingkou base.
It is the largest PBT manufacturer in China.
It is mainly used in auto parts, polymer alloys, optical cable protective sleeves, electronic appliances and other industrial fields
.

In addition, the company has an annual production capacity of 385,000 tons of BOPET functional films, which are used in BOPET optical equipment, release protection, electronic appliances and other high value-added links; it has the largest domestic production capacity of 33,000 tons of PBAT based on independent technology.
, used in green environmental protection applications such as food-grade shopping bags, tableware and straws in PBS/PBAT
.

In terms of research and development of mid-to-high-end products, in 2021, the high-smooth MLCC release base film independently developed by Kanghui New Materials has achieved mass production
.
It is worth mentioning that the 12-micron in-line silicon-coated release film developed by Kanghui New Materials has been successfully mass-produced and exported, becoming the only company in China and the second company in the world that can produce products of this thickness, with a monthly production capacity of more than 60 million square meters.
m
.

Hengli Petrochemical accelerates the layout of new materials

Since its entry into the capital market, Hengli Petrochemical has implemented a series of major projects represented by the 20 million ton/year refining and chemical integration project.
The scale of operation has continued to expand and operating performance has continued to improve
.

In 2021, Hengli Petrochemical achieved revenue of 197.
97 billion yuan, a year-on-year increase of 29.
92%; net profit attributable to the parent was 15.
531 billion yuan, a year-on-year increase of 15.
37%
.
The company's revenue and profit scale in 2021 will both hit record highs
.

Fan Hongwei, chairman of Hengli Petrochemical, previously stated in an exclusive interview with a reporter from China Securities Journal and China Securities Taurus that the company is continuing to consolidate and expand the upstream advantages of the "big chemical industry" sector with "refining + ethylene + coal" as the industrial carrier.
, will further accelerate the development of the downstream new material business sector, continue to enhance the development momentum of the new material business, create a "second growth curve", and accelerate the upgrade to the "platform + new material" development model
.

It is worth mentioning that, at present, Hengli Petrochemical's refining and ethylene business has become the cornerstone of the company's profitability, and the proportion of downstream new chemical materials segment has been expanding year by year, including differentiated polyester yarn, functional film, new engineering plastics and biochemicals.
The business of materials with high R&D attributes such as degradable new materials is in good condition
.

Under this development background, Kanghui New Materials, which is mainly engaged in the new material business, is undoubtedly an important platform for Hengli Petrochemical to accelerate the layout of the new material industry
.
This time Hengli Petrochemical plans to spin off Kanghui New Materials for listing, which will be of great significance for its new material industry to become stronger and bigger
.