Fundraising Plan - The company plans to issue convertible bonds to raise a total of up to RMB 630 million for various projects, with a total investment of RMB 848.68 million [1][2] - If the actual funds raised are less than the planned amount, adjustments can be made to the funding allocation as needed [2] Semiconductor Component Production Base - The first phase of the semiconductor component production base is located in Shaoxing, Zhejiang, with a construction period of two years, aiming to enhance the company's competitiveness in the semiconductor field [2][4] - The total investment for this project is RMB 489.06 million, with RMB 350 million allocated from the raised funds for capital expenditures [2][4] - The project aligns with the growth trends in the semiconductor industry, driven by factors such as the rise of electric vehicles and AI demand [2][3] Power Semiconductor Market - Power semiconductors are crucial for energy conversion and control in electronic devices, with IGBT and SiC being key components [3][4] - The global power device market is dominated by international giants, but domestic production is accelerating, indicating significant potential for import substitution [3][4] Supply Chain Collaboration - The project aims to strengthen supply chain collaboration by establishing factories near core semiconductor customers in the Yangtze River Delta, enhancing logistics efficiency and reducing inventory risks [5][6] - The region hosts 55% of China's top semiconductor companies, creating a dense industrial cluster [5][6] Economic and Policy Support - The project is supported by national and local policies promoting the semiconductor industry, including various incentives and funding opportunities [7][8] - The company has a strong foundation in product technology and customer resources, which will support the project's successful implementation [9] Thailand Production Base Project - The company plans to establish a production base in Thailand, with a total investment of RMB 309.62 million, aimed at increasing production capacity for automotive components [10][11] - This project aligns with national strategies to enhance international competitiveness and respond to global market demands [11][12] Market Expansion and Customer Relationships - The Thailand project will help the company integrate into the global automotive supply chain and strengthen relationships with major international clients [12][13] - The favorable investment environment in Thailand, including tax benefits and lower labor costs, supports the project's viability [13][14] Financial Impact - The fundraising will enhance the company's capital structure and support rapid business development, with part of the funds allocated for working capital [15][16] - The issuance of convertible bonds is expected to increase total assets and liabilities, improving the company's risk management capabilities [17] Feasibility Conclusion - The fundraising projects align with national policies and the company's strategic direction, promising economic and social benefits [17]

Core Viewpoint - The company plans to issue convertible bonds to unspecified investors, which may dilute immediate returns but aims to enhance long-term profitability through strategic investments in high-end precision components and semiconductor production capabilities [1][2][5]. Financial Impact Analysis - The company analyzed the impact of the convertible bond issuance on key financial metrics under three scenarios: net profit remaining flat, increasing by 10%, and increasing by 20% for the years 2025 and 2026 [2][3]. - Under the assumption of flat net profit, the diluted earnings per share (EPS) would decrease from 0.33 to 0.30 [4]. - If net profit increases by 10%, diluted EPS would rise to 0.34, while a 20% increase would elevate it to 0.41 [4]. Necessity and Reasonableness of the Issuance - The issuance is deemed necessary to fund projects that will enhance production capacity for semiconductor components and automotive connectors, thereby optimizing the product portfolio and improving competitiveness in high-tech sectors [6][7]. - The projects are expected to mitigate potential trade risks and strengthen supply chain security, particularly in international markets [8][9]. Relationship with Existing Business - The funds will primarily support the construction of semiconductor component production bases and enhance the company's existing capabilities in automotive electronic components [7][8]. - The company has established a strong market presence and customer base, which supports the feasibility of the proposed projects [11]. Measures to Mitigate Dilution of Immediate Returns - The company plans to implement several measures to manage the use of raised funds effectively, including strict adherence to regulatory requirements and regular monitoring of fund utilization [12][14]. - Enhancements in operational efficiency and cost management are also part of the strategy to improve profitability and mitigate the dilution of immediate returns [12][13]. Commitments from Management - The company's board and senior management have committed to ensuring the effective execution of measures to mitigate the dilution of immediate returns, including compliance with relevant regulations and maintaining transparency in profit distribution [14].