Report Investment Rating - No industry investment rating is provided in the report. Core Viewpoints - The target price for the first - day of Kaizhong Convertible Bond is estimated to be between 134 and 139 yuan, and it is recommended to actively subscribe. The expected first - day conversion premium rate is in the range of 31% - 36%. The estimated first - day new - bond subscription winning rate is around 0.0023% - 0.0031% [3][21][22]. Summary by Directory 1. Kaizhong Convertible Bond New - Bond Subscription Analysis and Investment Suggestions 1.1 Convertible Bond Basic Terms Analysis - The issuance method of Kaizhong Convertible Bond is priority placement and online issuance. The bond and issuer ratings are AA-. The issuance scale is 308 million yuan, the initial conversion price is 12.7 yuan, the bond parity on August 15, 2025, is 102.36 yuan, the calculated pure bond value is 91.47 yuan. The conversion terms, redemption terms, and put - back terms are normal. The bond issuance scale is relatively low, with poor liquidity, a decent rating, and good bond floor protection. It's not difficult for institutions to include it in their portfolios, and there is no objection to primary participation [2][17]. 1.2 New - Bond Initial Listing Price Analysis - The company is mainly engaged in the R & D, production, and sales of shock - absorbing components for automobile chassis suspension systems and lightweight pedal assemblies for control systems, as well as the R & D, production, and sales of special polyurethane elastomers such as high - performance polyurethane load - bearing wheels in non - automotive parts fields. After deducting issuance fees, 218 million yuan of the raised funds is planned for the expansion project of the Nantong production base, and the remaining 90 million yuan is for supplementary working capital. The target price for the first - day of the convertible bond is estimated to be between 134 and 139 yuan [3][20][21]. 1.3 Convertible Bond New - Bond Subscription Winning Rate Analysis - The estimated first - day new - bond subscription winning rate is around 0.0023% - 0.0031%. As of the end of 2024, the top two shareholders held 19.75% of the shares in total, and the top ten shareholders held 46.70% in total. Assuming the old - shareholder placement ratio is 20% - 40%, the scale available for the market is 185 million - 247 million yuan. By referring to recent bond issuances, the winning rate is estimated at the above - mentioned level [4][22]. 2. Underlying Stock Fundamental Analysis 2.1 Company's Main Business and Upstream - Downstream Industry Situation - The company's main business is as described above. The upstream industries include those related to isocyanates, polyols, metal parts, etc., and the company has stable cooperation with upstream suppliers. The downstream is mainly passenger vehicle manufacturers [23][24]. 2.2 Company's Operating Conditions - From 2022 to Q1 2025, the company's operating income showed an upward trend, with year - on - year growth rates of 17.07%, 15.17%, 1.22%, and 1.59% respectively. The main business income mainly comes from the automotive parts business, with a proportion of over 95%. The comprehensive gross margin is generally stable, with fluctuations mainly caused by the power business. The company's period expenses, R & D expenses, and accounts receivable have all fluctuated in recent years. The accounts receivable amount has gradually increased, and the accounts receivable turnover rate has decreased. The net profit attributable to the parent company has fluctuated, and the profitability has also shown a fluctuating trend [26][28][30]. 2.3 Company's Equity Structure and Major Subsidiaries - As of the end of 2024, the company's equity structure was relatively dispersed, with no controlling shareholder. The top two shareholders held 19.75% of the shares in total, and the top ten shareholders held 46.70% in total. The company has 14 important subsidiaries [43]. 2.4 Company's Business Characteristics and Advantages - The company has advantages in personnel reserves, technical capabilities, and market foundation. It has a deep talent reserve in relevant fields, a strong technical foundation, and has established good cooperative relationships with many well - known domestic and international enterprises [46][47][48]. 2.5 Allocation of This Round of Raised Funds - The company plans to issue convertible bonds with a total raised funds of no more than 308 million yuan. After deducting issuance fees, 218 million yuan is for the expansion project of the Nantong production base, and 90 million yuan is for supplementary working capital. The Nantong project is expected to have an annual production capacity of 27 million polyurethane shock - absorbing components and 3.5 million lightweight pedal assemblies after completion [49].

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints - The Kaizhong Convertible Bond (113698.SH) started online subscription on August 15, 2025, with a total issuance scale of 308 million yuan. After deducting issuance fees, the net proceeds will be used for the new intelligent small home appliance manufacturing base (Phase II) project of Guangdong Xiaoxiong Boutique Electric Appliance Co., Ltd. [3] - The current bond floor valuation is 91.47 yuan, and the YTM is 2.19%. The convertible bond has a 6 - year term, with a credit rating of AA - / AA - by Shanghai New Century Credit Rating & Investment Service Co., Ltd. The bond floor protection is good. [3] - The current conversion parity is 106.14 yuan, and the parity premium rate is - 5.79%. The conversion period is from February 23, 2026, to August 14, 2031. [3] - The convertible bond terms are mediocre, and the total share capital dilution rate is 8.31%. The pressure on share capital dilution is relatively small. [3] - It is expected that the listing price of the Kaizhong Convertible Bond on the first day will be between 130.76 and 145.40 yuan, and the subscription rate is expected to be 0.0013%. It is recommended to actively subscribe. [3] - Since 2020, Kaizhong Co., Ltd.'s revenue has grown steadily, with a compound growth rate of 10.96% from 2020 - 2024. In 2024, the company achieved an operating income of 739 million yuan, a year - on - year increase of 15.17%. [3] - Kaizhong Co., Ltd.'s operating income mainly comes from the automotive parts business, and the product structure changes annually. Since 2022, the proportion of the automotive parts business in the main business income has remained stable, all above 90% from 2022 - 2024. [3] - Kaizhong Co., Ltd.'s sales gross profit margin has remained stable, the sales net profit margin has decreased, the sales expense ratio has decreased, the financial expense ratio has remained stable, and the management expense ratio has increased. [3] 3. Summary by Directory 3.1 Convertible Bond Basic Information - The Kaizhong Convertible Bond's issuance and subscription schedule includes steps from August 13 to August 21, 2025, with specific arrangements such as announcements, roadshows, and subscription dates [9]. - The convertible bond has a code of 113698.SH, a total issuance scale of 308 million yuan, a 6 - year term from August 15, 2025, to August 14, 2031, a face value of 100 yuan, and specific coupon rates from the first to the sixth year. The conversion price is 12.7 yuan per share, and the conversion period is from February 23, 2026, to August 14, 2031 [10]. - The net proceeds from the issuance will be used for the Nantong production base expansion project and supplementary working capital, with 218.447 million yuan for the expansion project and 90 million yuan for supplementary working capital [11]. - The bond - related indicators show a pure bond value of 113.70 yuan, a pure bond premium rate of - 12.05%, and a pure bond YTM of 2.19%. The stock - related indicators show a conversion parity of 106.14 yuan and a parity premium rate of - 5.79% [11]. 3.2 Investment Subscription Suggestion - By referring to comparable targets and using an empirical model, it is expected that the listing price of the Kaizhong Convertible Bond on the first day will be between 130.76 and 145.40 yuan, with a conversion premium rate of about 30% on the first - day listing [14][15]. - It is expected that the priority subscription ratio of original shareholders will be 64.05%, and the online subscription rate will be 0.0013% [16]. 3.3 Positive Stock Fundamental Analysis 3.3.1 Financial Data Analysis - Kaizhong Co., Ltd. is a high - tech enterprise with independent innovation capabilities, focusing on automotive parts. Its products include shock - absorbing components and pedal assemblies, and it has a wide range of customers at home and abroad [17]. - From 2020 - 2024, the company's operating income had a compound growth rate of 10.92%. In 2024, the operating income was 748 million yuan, a year - on - year increase of 1.22%. The net profit attributable to the parent company fluctuated, with a compound growth rate of 2.24% from 2020 - 2024. In 2024, it was 90 million yuan, a year - on - year decrease of 1.56% [18]. - The company's operating income mainly comes from the automotive parts business, and the proportion of the rubber wheel business has been decreasing, with revenue from other businesses appearing for the first time in 2024 [22]. - From 2020 - 2024, the company's sales gross profit margin remained stable, the sales net profit margin decreased, the sales expense ratio decreased, the financial expense ratio remained stable, and the management expense ratio increased. The company's gross and net profit margins are higher than the industry average, and the sales expense ratio is lower, while the management expense ratio is higher [25]. 3.3.2 Company Highlights - The company focuses on R & D, production, and sales of automotive chassis suspension system shock - absorbing components, lightweight pedal assemblies, and special polyurethane elastomers. It has a high - quality R & D team covering multiple disciplines and has obvious advantages in material technology and other aspects [30].