St Datang 1.2 billion raise funds 61% for debt repayment

Every reporter Hu Yuhui for non-public issues for a week, triggering market Imagine St Datang (600198, closing price 10.28 yuan) finally solved the mystery. St Datang yesterday announced that it was proposed to raise no more than 1.2 billion yuan through Non-public offerings to improve the capital structure and achieve a 3G layout.　　But of those 1.2 billion yuan, 61%, or 740 million, will be used to repay bank loans. Industry analysts said that St Datang's investment in several projects, and Dongxin (002017, closing price of 12.90 yuan), Heng Bao shares (002104, closing price of 10.92 yuan) of its existing business somewhat overlapping.　　In view of this non-public offering plan, the market is looking forward to the Datang Telecom Group integration has not become a reality.　　Raised 740 million for repayment of loans St Datang yesterday announced that the company intends to issue no more than 10 specific targets, including the telecommunications Science and Technology Research Institute of the controlling shareholder, with no more than 140 million shares in the price of not less than 8.70 yuan/share, and a total of 1.2 billion yuan for the improvement of capital structure and the realization of industrial overlap. St Datang is preparing to invest the money in 4 projects. One of the most important projects is the repayment of bank loans, the company intends to invest 740 million yuan, accounting for the total amount of 61.6%, followed by the bank EMV card research and development and industrialization projects, to invest 192 million yuan, the remaining two for TD-SCDMA data Fusion product development and industrialization projects,　　New 3G Smart card research and development and industrialization project, the proposed funds are 172 million yuan and 96.01 million yuan respectively. Yesterday's industry analysts said that from the public plan to see, St Datang this time the Non-public Development Unit is one of the focus of the repayment of bank loans. The plan shows that the scale of corporate indebtedness has risen in recent years, and the huge interest charges for this expenditure have a direct impact on the company's performance in the past year: 2007, 2008 St Datang each year has 139 million yuan scale of interest expenditure, while the company's total profit is only 82 million yuan and 133 million yuan respectively, interest expenditure accounted for the total annual profit of 171% and 104.5%. And the company's assets and liabilities in the last three years are maintained at more than 80%, far higher than the industry's average of about 50%.　　St Datang expects the company's asset-liability ratio to fall 28.17% from 2008 's 84.66% per cent after raising funds to repay bank loans, with an annual savings of 42 million yuan, which is about 32% of total profits last year. The desire to inject the core assets of the group before the analyst told reporters that St Datang this non-public release plan is better than his expectations.　　The reason is that the company is carrying out the industrial layout, the bank EMV card development and the 3G Smart card industrialization are more to have the aspect item. Among them, in the bank EMV card research and development, the market is quite huge. The analyst said that at present, China's bank card is still stuck in the magnetic stripe card stage, EMV means that the upgrade of product replacement. OnceDomestic start-up bank card EMV migration, which means that most of the existing bank cards will be replaced by IC card, the market is quite huge.　　and St Datang also said, to each IC card 8 yuan ~10 yuan manufacturing cost, 1.8 billion stock bank card EMV transfer to calculate, only stock replacement brought market scale of up to 15 billion yuan ~180 billion. Smart card industry, the analyst said, popular point of view is the mobile phone card, but the 3G smart card market expansion is based on mobile phones, to see the number of operators 3G user growth.　　The analyst believes that although the St Datang in the 3G smart card market target covers three major operators, but in the CDMA2000 and WCDMA areas, it is difficult to compete with ZTE, Huawei and other mature manufacturers. The analyst also pointed out that the St Datang to do the above two business, and a little to the East letter peace, Heng Bao shares closer to the taste. As a A-share market, the main two card manufacturers, the East letter of peace and Heng Bao has a communications card and financial card business, and two currently has a bank IC card finished products, St Datang as a post-entry, to occupy the market, it is not easy.　　However, the analyst added that St Datang's ability to chip design is better than these two, so the gross margin will improve. In addition, the previous analyst said, from the St Datang announced yesterday, should be the company's own financing behavior, there is no Datang Telecom group Shadow, the market hope Group will be its core assets Datang mobile into the idea of the listed companies, is expected too high. He said that from this point of view, it is expected that in Friday also because of non-public issues suspended High-hung shares (000851, closing price of 7.99 Yuan) (Datang Telecom Group's other listed platform), should also be for the expansion of its projects or other 3G-related projects to raise funds, the group is not likely to be related.