What did the power battery company suffer during the last six years when it made a difference from zero to maximum in Ningde times?

Within six years, the Ningde era had shot up to become the world's largest power battery company, valued at more than 130 billion yuan. The reasons behind this are not only the government's industrial policy support, but also the help from China, the world's largest new energy vehicle market, the integration of resources throughout the industrial chain and heavy investment in technology research and development.

"There are too many customers in the Ningde era to supply." The head of a small Sino-japanese joint venture that makes new energy vehicles complained to southern weekend that his company, with its size and volume, was unable to get supplies of Ningde era batteries. In the past, vehicle makers were more powerful than parts suppliers.

On April 4, 2018, Ningde era new energy technology co., LTD. (hereinafter referred to as "Ningde era"), headquartered in Ningde city, Fujian province, China, successfully held a meeting and will soon raise 131 capital through IPO. At rmb200m, that would set a new fundraising record for a private company in China.

Ningde era is the world's largest power battery company by sales. It only took six years from 0 to an estimated value of over 130 billion yuan. It only took five months from filing the prospectus to the IPO going through.

In just six years, how did the Ningde era jump the gun and become a behemoth in the field of power batteries?

Leverage the entire industrial chain with prade

Ningde era was born from the Ningde people Zeng Yuqun returned home to start a business.

In 1989, Zeng Yuqun, 21, was assigned to a state-owned enterprise in Fujian province after graduating from the ship engineering department of Shanghai Jiaotong university. He resigned three months later and came to Dongguan to work as an engineer in a Hong Kong-invested enterprise that made hard disk heads.

In 1999, together with the former company leader, Zeng Yuqun registered in Hong Kong new energy technology co., LTD. (ATL) and entered the consumer battery industry.

ATL chose polymer flexible pack battery as its product at the beginning. It purchased the patent authorization of polymer lithium battery of bell laboratories in the United States, and made a battery without blowing air by adjusting and improving the electrolyte formula through experiments.

ATL caught up with the rapid popularity of China's mobile phone industry in 2000, initially set up a factory in Dongguan, and opened the factory to Zeng Yuqun's hometown Ningde in 2008, investing 1.5 billion us dollars to build the world's largest lithium ion battery production base.

Zeng Yuqun has long been a permanent resident of Hong Kong as a professional in science and technology, but he did not forget his hometown, located in the eastern Fujian province Ningde is a typical "old, little, border, island, poor" area, Ningde new energy arrival, to a certain extent changed the face of the city.

Three years later, ATL's power battery division was spun off and the Ningde era was founded. Until March 2017, Zeng Yuqun served as President, CEO and director of ATL. General manager and director of Ningde times.

Whether it is ATL or Ningde times, the initial establishment is backed by the tree. Becoming the battery supplier of apple in 2004 is the starting point of ATL consumer battery products. Seven years later, it became the supplier of brilliance BMW and one of the stepping stones for ningde era to open the door of power battery.

Based on the background of ATL apple battery supplier, BMW brilliance took the initiative to come to the door in 2011 to find a battery manufacturer for the pure electric car novo 1E.

On March 21, 2017, President of BMW brilliance Wei Lande invited Zeng Yuqun to the 60H listing conference of BMW brilliance and Shared the story of bilateral cooperation.

Brilliance BMW has submitted more than 700 pages of power battery system requirements specifications to ningde times, detailing the energy and power requirements under different working conditions and hundreds of quality management requirements. The two sides have set up a joint battery development team of more than 100 people, covering all key technical fields of battery packs, including battery cells, system architecture, mechanical design, test and verification, quality management and so on.

After cooperating with BMW brilliance, Ningde era has gone through the whole process of power battery research and development, design, development, certification and testing, and has accumulated experience and brand endorsement for its subsequent development. It was the only Chinese company to enter the power battery supply chain of a multinational automobile company at that time.

The sales volume of brilliance BMW pure electric car Zino is very limited, and the purchase amount of the first model of zino in 2014 was only 1. 700 million yuan. Since then, there are two enterprises that really push the Ningde era to complete vehicle industry support, one is Zhengzhou Yutong group co., LTD. (hereinafter referred to as "Yutong"), and the other is Beijing pulde new energy battery technology co., LTD. (hereinafter referred to as "Beijing pulde").

From 2014 to 2017, Yutong ranked the top five sales customers of Ningde times for three consecutive years. Yutong new energy passenger cars in the domestic market share of large passenger cars reached more than 30%, the purchase of large quantities of batteries is not surprising.

As the core component of new energy vehicles, the research and development, production and sales of power batteries should be carried out according to the specific needs of specific models of the vehicle factory and jointly developed with the whole vehicle. Generally, after entering the qualified supplier list, the manufacturer will not easily replace the power battery system supplier. As a third party battery management solution company, Beijing preder is an important link to open up the industrial chain layout of power battery in Ningde era.

Before brilliance BMW, ATL cooperated with automobile manufacturers as a joint venture company. In April 2010, Beijing advance technology industry co., LTD. (hereinafter referred to as "Beijing advance"), Dongguan Xinnengde technology co., LTD. (ATL subsidiary), Beijing automotive industry holding co., ltd. and Beiqi Foton automobile co., ltd. jointly invested and established Beijing advance.

This cooperation is crucial in the development of Ningde era. Beijing prede was its third largest sales customer in 2014 and 2015, and its second largest sales customer in 2016 and 2017, even though it only purchased battery cells from Ningde times rather than complete battery packs.

And in the upper reaches of the industrial chain, Ningde era also has early layout.

Among the top five suppliers of Ningde era, a company named Qinghai Taifeng first lithium energy technology co., LTD. (hereinafter referred to as "Taifeng first") ranked second and third respectively in 2015 and 2016. Ningde era mainly purchased anode materials from it.

Peking University is the leading controlling shareholder of taifeng and Beijing prade. On November 5, 2012, Taifeng first and Ningde times jointly funded the establishment of Qinghai times new energy technology co., LTD. (hereinafter referred to as Qinghai times), accounting for 25% and 75% respectively. This is the first production base outside Ningde in Ningde era. In June 2015, Taifeng withdrew first. Qinghai era is now a wholly-owned subsidiary with the largest asset scale under Ningde era.

Peking University was first established on December 10, 1999. It was co-founded by dongsheng investment co., ltd. and Peking University. Its main business is cathode materials. Similar to the Ningde era, Peking University first benefited from the development of China's mobile phone battery business, and then moved into power batteries.

Beijing prede's business model is the industrial chain division and cooperation of "beida first (battery cathode material) + Ningde times (power battery cell) + prede (power battery system PACK) + Beijing automotive new energy (new energy passenger vehicle application) and foton automobile (new energy commercial vehicle application)".

This model, central enterprises have long wanted to do so. On August 18, 2010, 16 central enterprises directly under the state-owned assets supervision and administration commission (sasac) announced the establishment of the "central enterprise electric vehicle industry alliance" in Beijing, covering the three fields of vehicle, battery and charging, in an attempt to unify the technical standards and norms of electric vehicles, develop core generic technologies, and promote the coordinated development of upstream and downstream enterprises in the industrial chain. Sasac also allocated 1.3 billion yuan to support the construction of a generic technology platform for electric vehicles.

But like many "industry-university-research" and "government-industry-university-research" projects, the central enterprise alliance has since fallen through.

Firewalls and protective walls

Ningde times and other domestic power battery enterprises can not rise without the protection of industrial policies.

According to the "regulations on the management of new pure electric passenger vehicle enterprises" issued by the national development and reform commission and the ministry of industry and information technology (" miit ") on June 2, 2015, new energy vehicles can only apply for government subsidies for their auto products if they are included in the "catalogue of recommended models for the promotion and application of new energy vehicles" (hereinafter referred to as "catalogue").

New energy vehicles with batteries outside the catalogue cannot receive subsidies and foreign battery companies are excluded. This protective policy has built a protective wall and firewall for domestic advantageous battery enterprises such as Ningde times.

Foreign battery companies had already entered the Chinese market.

Since 2014, Samsung SDI, LG Chem, SK and other power battery companies have entered the Chinese market on a large scale with cheaper and more efficient ternary lithium batteries as the entry point. In 2015, the battery factories of Samsung SDI and LG chemical in xi 'an and Nanjing were completed and put into production respectively, including Faw, Saic, Baic, Chang 'an, Great Wall, Chery and other domestic mainstream independent auto companies, which have become their partners and purchased power batteries from Korean companies.

Power batteries need to be produced on a large scale and mounted on cars to better promote technology development and reduce costs. The market environment of China's scale is not available in other countries' automobile market.

After the policy adjustment, China's power battery industry pattern changes quickly. Jac, saic and baic have replaced foreign-invested batteries with domestic ones. At the end of 2016, Baic, Beijing electronics holding co., ltd. and SKI of South Korea jointly invested in Beijing electronic control aisikai technology co., ltd. in 2013 stopped production, and LG transferred the Nanjing plant and Samsung SDI Tianjin plant for difficult maintenance.

In the Beijing prade acquisition, Ningde times received 4. 5 percent. 3.7 billion yuan in cash and 71.25 million shares (5 percent). 58%) shares of Orient Seiko, not ATL.

In order to enjoy state subsidies and policy support, the Ningde era must cut its ties with foreign investment.

On March 24, 2016, Dongguan Xinneng DE technology co., LTD. (ATL subsidiary), the former shareholder of prade, transferred 25% of prade's shares to Ningde times at a transfer price of 67.5 million yuan. Three months later, Oriental Seiko announced the acquisition and restructuring plans.

ATL's shareholders are mainly TDK (Japanese listed company, stock code 6762). T), TDK Hong Kong Company Limited (TDK subsidiaries) and Valiancy Limited, holding 41 respectively. 80%, 57. 58% and 0. 62%.

The explanation of Ningde times is that according to the strategic adjustment of TDK, the parent company of ATL, ATL gradually withdrew from the new energy vehicle power battery business from 2015. In October 2015, ATL transferred the limited 15% equity of Ningde era to Ningbo Lianchuang. After the equity transfer, ATL no longer directly or indirectly held the equity of Ningde era.

Since then, government subsidies and state capital have poured into the Ningde era. From 2015 to 2017, Ningde times received a total of 10 government subsidies. 6.3 billion yuan, mostly from Ningde.

In 2015, according to the way of "Ming equity and real debt", China development fund bought shares in Ningde times lithium power and Qinghai times, subsidiaries of Ningde times, a total of 6. 900 million yuan, the average annual rate of return is 1. A 2% return on investment.

The China development bank development fund (CDF) is a policy-based investment entity formally registered and established by the China development bank in August 2015. It mainly supports the construction of projects in key areas identified by the state in order to stabilize economic growth, stimulate investment, strengthen structural adjustment and transformation and upgrading.

In June 2016, Ningde times established a subsidiary company in Liyang city, Jiangsu province, planning to invest 10 billion yuan to build a lithium battery factory with an annual capacity of up to 10GWH. Jiangsu Zhongguancun science and technology industrial park management committee provided Jiangsu times, a subsidiary of Ningde times, with a five-year loan of 200 million yuan with an annual interest rate of 3%.

Wide knot good marriage

With the decline of subsidy policies from the government year by year, ningde era quickly started strategic cooperation and capital binding with major domestic vehicle enterprises, so as to form an industrial closed loop.

In 2016, Ningde times respectively signed strategic framework agreements with Chang 'an automobile and Dongfeng motor group, with 1. 02.4 billion yuan invested in Beijing new energy vehicles. In 2017, Changan automobile and Saic motor co., ltd. have invested in Ningde times. In May 2017, Ningde times and Saic motor group investment management co., LTD., a wholly-owned subsidiary of Saic motor corporation, jointly established two new energy enterprises: times saic power battery co., ltd. and times Saic power battery system co., LTD.

At present, it maintains long-term strategic cooperation with leading automobile enterprises in the industry such as Yutong group, Saic motor, Beijing automotive industry corporation, Geely group, Fuqi group, CRRC, Dongfeng group and Chang 'an group. Enter the supply system of BMW, Volkswagen and other foreign auto companies.

Since 2015, China has been the world's largest new energy vehicle market for three consecutive years, with annual sales of 33. 10,000 vehicles increased to 77. 70,000 units. Accordingly, the sales volume of Ningde times power battery system in 2015, 2016 and 2017 is 2. 19 GWH, 6. 80 GWH and 11. 84 GWH.

According to GGII statistics, the sales volume of power battery system of Ningde time co., ltd. ranked the top three among global power battery enterprises for three consecutive years, and the sales volume ranked the first in the world in 2017.

BYD, which was in the top row, has limited growth because its batteries are made and sold by itself. Perhaps realize this huge mistake on March 31, 2018, Shen xi, vice President of BYD's lithium electric business, said that BYD is working on the separation of power battery business and that BYD's power battery company will go public independently from 2022 to 2023.

In addition, Panasonic's battery sales growth is mainly from tesla, the growth rate is far less than the widely married Ningde era.

Of course, the faster the development, the better it is. Nor is it easy to integrate the industrial chain. In March 2018, Watma, the world's fourth largest power battery company by sales volume, was found to be in arrears with suppliers and overdue debts, which had to be offset by inventory sales and fixed asset sales.

Walter Tamar to form a "China Walter m new energy automotive industry innovation alliance", with its own power battery business as the core, trying to joint industrial chain upstream and downstream enterprises, through its associated companies new Walter power directional procurement Oems vehicles, requiring them to Walter purchasing batteries, it pushed up Walter's performance, turned out to be a large number of hoarding.

Guoxuan high-tech, which is very similar to the Ningde era, is also building the upstream and downstream of the industrial chain and taking a stake in Beijing new energy, but its size and scale are not as good as the Ningde era.

A head of the battery system laboratory of a joint venture automobile company told southern weekend that the R&D strength of Ningde era is indeed ahead of its domestic counterparts, especially in terms of the most intuitive technical capabilities such as battery energy density and charging speed, which are the key factors for it to be recognized by vehicle manufacturers and investors.

This is inseparable from the accumulation and sharing of battery technology at the early stage of ATL, and is also related to the investment of Ningde era in technology research and development. From 2015 to 2017, the proportion of R&D expenses in the operating income of Ningde era was 4. 93%, 7. 27%, 8. 02%.

Ningde times launched two rounds of equity financing at the end of 2015 and the second half of 2016 respectively. The scale of the first round of financing is 3 billion yuan, the post-investment valuation is 21 billion yuan, the final state investment innovation, Bohai Huamei, Junlian capital, seven Wolf capital, Guangzhou Yuexiu industrial investment fund, channel industrial investment fund, Guangfa Xinde, yuan da capital, Shenzhen venture capital, a village capital and other institutions to invest; The second round of financing scale is 8 billion yuan, the post-investment valuation is 80 billion yuan, and the final overfunding, including Sdic innovation, Shenzhen venture capital, China merchants international, Guangfa Xinde, Septwalf capital and other institutions to buy shares.

The head of the battery system laboratory of the joint venture believes that the development trend of new energy vehicles is certain whether the policy goes down or not, and that with capital support, the scale effect of the Ningde era will push it to a more advanced position, unless there is a sudden revolutionary shift in power battery technology.

However, through capital and technical cooperation, Beijing pulder opened a channel and sold a package at a good price in 2017. April 2017, Oriental seiko (002611). SZ) to 47. 500 million yuan for 100% stake in Beijing prede.