Chunqiu Electronics' net profit increased by 431.62% in the first half of the year, competing with Huaqin Communication for domestic substitution

Chunqiu Electronics (603890) released its 2020 semi-annual report. The company achieved operating income of 1.359 billion yuan from January to June 2020, a year-on-year increase of 70.36%. The net profit attributable to shareholders of listed companies was 138 million yuan, a year-on-year increase of 431.62%, and earnings per share was 0.3600 yuan. 

The average operating income growth rate of individual stocks in the electronic manufacturing industry to which the company belongs, which have disclosed their semi-annual reports, is 6.53%, and the average net profit growth rate is 1.23%.

Chunqiu Electronics stated that the increase in operating income was due to the stable demand in the downstream market, which provided strong support for the growth of the company's sales scale. The company has been deeply engaged in the market segments, established strategic partnerships with core customers, and increased its revenue and market share.

As a one-stop service manufacturer of laptop computer structural parts modules and related precision molds from design, mold manufacturing to structural parts module production, Chunqiu Electronics has benefited significantly from the recovery of the laptop computer industry due to the sudden outbreak of the epidemic this year, which has promoted the rapid development of industries such as remote office and online education. Laptop computers as terminal applications have seen a substantial increase in demand.

The interim report disclosed that in order to further increase its market share, Chunqiu Electronics continued to strengthen its notebook metal structural parts business and increase business cooperation with customers in the field of high-end notebook structural parts. On April 14, 2020, Chunqiu Electronics successfully issued 240 million yuan of convertible corporate bonds. The funds raised will be used for the annual production of 30 million consumer electronics precision metal component production lines and 200 sets of precision mold intelligent production line projects (Phase I) and to supplement working capital.

In addition, Chunqiu Electronics will join hands with Huaqin Communications to seize the domestic substitution. In June 2020, the company signed the "Investment Cooperation Framework Agreement" with Shanghai Moqin Intelligent Technology Co., Ltd., a wholly-owned subsidiary of Huaqin, and plans to jointly invest in the establishment of Nanchang Chunqiu Electronic Technology Co., Ltd., which will help Chunqiu Electronics seize the domestic substitution, seize a certain market share in domestic notebook computers, and further expand the company's market share in the field of notebook computer structural parts.

At the same time, Chunqiu Electronics signed a "Capital Increase Agreement" with Ma'anshan Hengjing Metal Materials Technology Co., Ltd. The investment in Hengjing Materials Technology is one of the ways for Chunqiu Electronics to layout the field of new energy vehicle parts, which is conducive to the company's entry into the field of automotive parts and lays the foundation for the company's future development in the field of automotive electronics. It meets the company's long-term development needs and is of great significance to the company's long-term development.