Hongda Electronics plans to increase its capital by RMB 1 billion to increase investment in its main business of microwave electronic components

On June 6, Hongda Electronics released a plan for a private placement, showing that the company plans to raise no more than 1 billion yuan through a private placement, of which 620 million yuan will be used for the construction of a microwave electronic component production base, 180 million yuan will be used for the construction of a research and development center, and another 200 million yuan will be used to supplement working capital.

At present, Hongda Electronics has become a leading enterprise in the domestic high-reliability electronic components segment. Among them, tantalum capacitor products have reached the domestic leading level, with a high market share and brand awareness. In the past three years, the company's tantalum capacitor revenue was RMB 517.1705 million, RMB 598.9445 million and RMB 857.3218 million respectively, showing an increasing trend year by year.

In recent years, Hongda Electronics has actively promoted the horizontal layout of products on the basis of maintaining the leading position of its original tantalum capacitor products, and vigorously developed new products such as ceramic capacitors, circulators and isolators. However, the current production capacity is still relatively low. Through the construction of this fundraising project, the company's ceramic capacitor, circulator and isolator production capacity will be effectively improved to meet the needs of my country's high-end, information-based and intelligent manufacturing construction.

According to the disclosure, the construction of this fundraising project is mainly used for the expansion of the production capacity of ceramic capacitors, circulators and isolators. Among them, ceramic capacitors are basic components widely used in aerospace, aviation, ships, weapons and equipment, communication equipment, consumer electronics, automotive electronics and many other fields. They account for more than 50% of the entire capacitor market, which is much higher than other types of capacitors, and the market space is large; circulators and isolators are widely used in base station antennas and RF front-ends. The innovation of each generation of communication technology will bring a large amount of new market demand for circulators and isolators. The number of 5G base stations built is 1.2-1.5 times that of 4G base stations. In addition, the number of antenna channels of 5G base stations will increase from the original 2-8 channels to 64 channels, thereby greatly increasing the market demand for circulators and isolators.

Hongda Electronics stated that through the construction of this fundraising project, the company's ceramic capacitors, circulators and isolators will be effectively increased in production capacity, the company's horizontal layout development strategy will be deepened, and new profit growth points will be cultivated. The company's ceramic capacitors, circulators and isolators revenue scale is showing a rapid upward trend, but the current production capacity is still relatively low, and the capacity utilization rate is high, which cannot meet the continued demand growth of downstream customers. Through the construction of this fundraising project, the company's ceramic capacitors, circulators and isolators will be effectively increased in production capacity, fully responding to the country's key strategy of achieving independent control, meeting the high-end market's domestic substitution needs, and further consolidating its market position.