The Board of Directors of Shenma Industrial Co., Ltd. (hereinafter referred to as “Shenma Co., Ltd.”) is the largest nylon 66 manufacturer in China and has the most complete nylon industry chain layout.
The financial report for the first three quarters of 2023 was disclosed on October 11. During the reporting period, the company achieved operating income of 9.431 billion yuan, a decrease of 17.6% compared with the same period last year. The net profit attributable to shareholders of the listed company was 70.3586 million yuan, a decrease of 85.63% compared with the same period last year. ; Among them, operating income in the third quarter was 3.326 billion yuan, a decrease of 0.39% compared with the same period last year, and net profit attributable to shareholders of listed companies was 100 million yuan. Regarding the changes in net profit in the first three quarters, the company explained that it was mainly due to the decrease in profit for the current period compared with the same period.
Public information shows that Shenma Co., Ltd. was established in 1997. It is a very large enterprise with Pingmei Shenma Group as its controlling shareholder and its main business is chemical industry and chemical fiber. It is the management platform of Pingmei Shenma Group’s nylon sector. The company’s industrial structure spans two major industries: chemical industry and chemical fiber. It has formed a company with leading products such as nylon 66 salt, nylon 66 slices, modified engineering plastics, industrial yarn, BCF carpet yarn, and airbag yarn as its pillars, and raw and auxiliary materials and A new industrial pattern based on related products. Judging from the development history of the company’s nylon 66 business, the company has focused on the field of nylon 66 since its establishment. In 1998, the company’s nylon 66 salt and chips were completed and put into production; in 2012, the cord fabric and industrial yarn production lines in Shenma Nylon Industrial Park were put into operation, and the company’s nylon 66 industrial chain was further extended and expanded; in 2020, the company began to layout the upstream and downstream of the nylon industry chain, including Adiponitrile is a key raw material for the production of nylon 66. Due to high technical barriers and investment thresholds, it is a highly monopolized product. In order to ensure the supply of raw materials,
In 2020, the company plans to set up a wholly-owned subsidiary in the Nylon New Materials Industry Cluster Zone in Pingdingshan City to build an adiponitrile project with an annual output of 50,000 tons, with a construction period of 2 years. Since the industrialization of adiponitrile had not yet been realized in China at that time, the construction of this project would break the current situation of all dependence on foreign imports of adiponitrile, replace some imports, improve the company’s advantages in the nylon industry chain, and promote the healthy development of the domestic nylon 66 industry. In 2021, the company will complete the integrated layout of the nylon 66 industry and become the largest nylon 66 manufacturer in China.
Shenma Co., Ltd. implements refined management integrating research, production and sales. In terms of procurement, the company’s procurement model is mainly based on bidding and procurement. It implements an innovative bidding model of “bidding + benchmarking + auditing” to strengthen supplier certification and ensure the quality of product supply. In terms of production, we mainly adopt a continuous and uninterrupted production model. Based on factors such as product market trends, customer order requirements, product and raw material inventory, etc., assign production tasks to organize production to fully ensure product delivery. In terms of sales, the company has been deeply involved in the nylon industry for 40 years, forming a nationwide and global marketing and service network. It has established a professional marketing team based on different market conditions at home and abroad, and mainly adopts a direct-to-customer sales model to enable sales personnel to communicate with customers. Domestic and foreign terminal manufacturers communicate closely to understand the production and operation dynamics of downstream manufacturers and customer needs in real time.
The nylon 66 business is the main business of Shenma Co., Ltd., accounting for about 60% of the total revenue. Shenma’s nylon 66 products mainly include nylon 66 industrial yarn, nylon 66 cord fabric and nylon 66 slices. In 2022, affected by the Russia-Ukraine conflict and the Federal Reserve’s multiple interest rate hikes, international crude oil prices and bulk raw material prices have been running at high levels for a long time. This, coupled with the impact of repeated outbreaks of domestic epidemics, has put greater pressure on the good operation of the industry. Facing the complex internal and external environment, Shenma Co., Ltd. relies on its own research and development advantages, the advantages of the entire industry chain, and the advantages of product quality to strengthen the integrated coordinated development of production, marketing and research, steadily implement the business plan for the year, and promote the steady development of the enterprise. The company’s nylon 66 business operation The closing trend is good.
It is understood that the chemical name of nylon 66 is polyhexamethylene adipamide, and its industrial abbreviation is PA66. It is a translucent or opaque milky white resin. Nylon 66 has excellent heat resistance and strong impact resistance, and is widely used in automotive parts, power and electronic devices, machinery industry, precision instruments and other fields. Industrially, nylon 66 is generally produced by the polycondensation method of adipic acid and hexamethylenediamine. The technical barriers to the industry of adiponitrile, one of the main raw materials, are extremely high. The production technology is basically controlled by Invista, Rhodia, and Solutia, especially Invista almost monopolizes the global trade in adiponitrile. Affected by the supply of raw materials and related technologies, nylon 66 production technology and product capacity are mainly concentrated in the United States, the United Kingdom, France, Germany, Japan and other places. The major global manufacturers include Invista, DuPont, Solutia, Ascend, and Rhodia , BASF, Radici, Asahi Kasei, etc. In 2021, the global nylon 66 production capacity will be approximately 3 million tons. The four companies INVISTA, Ascend, DuPont, and BASF account for 62% of the production capacity. Among them, INVISTA’s nylon 66 polymer production capacity accounts for approximately 40% of the world.�The industry is an oligopoly.
From the perspective of domestic enterprises, there are currently seven nylon 66 manufacturers in my country. The top three enterprises are Shanghai Invista, Shenma Co., Ltd., and Huafon Group, with a total production capacity of 550,000 tons, accounting for approximately 80% of the country’s total production capacity. From the perspective of regional distribution, my country’s nylon 66 production capacity is mainly concentrated in Shanghai, Henan, Zhejiang, Liaoning, Jiangsu and other places.
Industry insiders believe that as the leader of the nylon 66 industry chain, Shenma Co., Ltd. has technological and scale advantages. With the company’s adiponitrile project steadily advancing, it will break the restriction of raw materials after it is put into production; the hydrogen ammonia project and nylon 66
Capacity expansion, cost and scale advantages.
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