TongDa Cable(SZ:002560)2022-12-07 08:32Business Performance and Growth Projections - In 2015, the company saw an increase in orders from the State Grid compared to 2014, driven by significant investments in power line construction, including a rise in spending on UHV construction, new rural grid transformation, and distribution network construction [1] - The company implemented an equity incentive plan in October 2015, setting performance growth targets based on 2014 figures: revenue growth rates of at least 30% for 2015, 60% for 2016, and 80% for 2017; net profit growth rates of at least 25% for 2015, 60% for 2016, and 80% for 2017 [2] Market Position and Competition - The company's cable products are classified as material-type bidding in the State Grid's tender system, with strict quality requirements for UHV lines leading to fewer competitors compared to lower voltage lines [2] - The domestic competitors in UHV cable supply include Far East Cable and Zhongtian Technology, with a high technical and capability threshold for suppliers [2] Railway Market Insights - The national investment in railway construction is increasing, with plans for new high-speed rail lines and international connections, indicating a promising market outlook [3] - The company has developed new copper alloy contact wire and supporting products for electrified railways since 2009, achieving stable operation and some exports to South Korea [3] - The railway market has high entry barriers, requiring strict certifications, which the company has successfully obtained, laying a solid foundation for future expansion [4] Strategic Direction and Potential Transformation - The company aims to maintain steady growth in its core business while exploring opportunities in light-asset, high-profit industries through acquisitions [5] - Potential areas for transformation include smart manufacturing, military applications, and medical services, with a commitment to deepening industry engagement rather than trial-and-error approaches [6] - The company plans to leverage its financial and regional advantages to support acquired businesses, particularly in the context of local government initiatives promoting industrial robotics and smart equipment [6][7] Acquisition Strategy - Following a failed acquisition in 2014, the company remains open to pursuing strategic acquisitions that align with its goals and can create synergistic benefits [7] - The search for potential acquisition targets is not limited to the local region, emphasizing a commitment to a collaborative and mutually beneficial partnership approach [7]