A-share subscription | Weihua New Materials (603310.SH) opens subscription. The company has independent core technologies in processes such as chlorination, fluorination, nitration, hydrogenation, nitrosation, and amination.

On August 5, Weihua New Material (603310.SH) started its IPO, with an issue price of 17.39 yuan per share and a maximum subscription limit of 27,500 shares. The price-earnings ratio is 12.26 times, and it is listed on the Shanghai Stock Exchange, with China Securities Co., Ltd. as the sponsor and lead underwriter. According to the prospectus, since its establishment, Weihua New Material has been focused on the field of fluorinated fine chemicals, being a high-tech enterprise specializing in the research and production of chlorotoluene and trifluoromethylbenzene series products. The company is considered a national-level specialized and new "little giant" enterprise. With a focus on technological innovation and the manufacturing of chlorine and fluorine-containing specialty chemicals, the company has developed a complete product chain of chlorotoluene and trifluoromethylbenzene series products starting from toluene as the raw material. Through persistent technological research and improvement, Weihua New Material has made significant technological breakthroughs, owning core technologies in chlorine, fluorination, nitration, hydrogenation, diazotization, and ammoniation processes, with a total of 17 invention patents. The company's core R&D team has won awards including the National Science and Technology Progress Award (second prize), the Zhejiang Provincial Science and Technology Progress Award (first prize), and the National Business Science and Technology Progress Award (first prize) in 2022. The company's products have achieved automated and continuous production, with the successful use of Corning's first set of ten-thousand-ton G5 microchannel reactor globally, achieving fully continuous automated stable production of diazotization reaction, hydrolysis reaction, and downstream separation and purification, greatly enhancing production safety, saving space and labor, and significantly reducing waste discharge and energy consumption. Weihua New Material is a high-tech enterprise specializing in the research and production of chlorotoluene and trifluoromethylbenzene series products, with a relatively complete industrial chain of chlorotoluene and trifluoromethylbenzene series products starting from toluene as the raw material. The company employs leading domestic production processes and digital, automated engineering control technology, with product quality reaching domestic or international advanced levels. The company holds patents or proprietary technologies in continuous kettle reaction, continuous tower reaction, continuous microchannel, and tubular reactor. The company has been awarded honors such as National High-Tech Enterprise, Nationally Rated Integration of Two Types, and Zhejiang Province's Cultivation of Invisible Champions. In 2021, the company was honored with the "Thirteenth Five-Year Plan Petroleum and Chemical Industry Environmental Protection Advanced Unit" and "Petroleum and Chemical Industry Green Factory" titles by Petrochina and the Chemical Industry Association. "Weihua New Material" has gained wide recognition in the industry, establishing its own brand influence and having a high market reputation. Weihua New Material has a prominent advantage in the domestic market for trifluoromethylbenzene series products, with a large production capacity and a complete industrial chain. The company holds a leading position in the supply market for trifluoromethylbenzene series products and is a well-known leading enterprise in the industry. In the same industry, companies such as Shandong De'ao Fine Chemicals Co., Ltd. and Shandong Daokai Chemical Co., Ltd. have smaller production scales and less complete product chains in the trifluoromethylbenzene series products. The company's product scale is considered large in the industry, with its market share ranking among the top in various segmented product areas. In the domestic market for chlorotoluene series products, companies such as China Salt Changzhou Chemical Co., Ltd., Anhui Haihua Technology Group Co., Ltd., and Jiangsu Chaoyue Chemical Co., Ltd. are large chemical companies producing (meta) chlorotoluene and other series of products, serving as the company's main competitors in the chlorotoluene market. Financially, in 2020, 2021, 2022, and January-June 2023, Weihua New Material achieved operating revenues of approximately RMB 1.063 billion, 1.424 billion, 1.776 billion, and 876 million respectively. The net profits for the same periods were approximately 170 million, 431 million, 622 million, and 329 million respectively. It is worth noting that Weihua New Material has mentioned in the prospectus that there is a risk of intensifying market competition. During the reporting period, the company held a leading position in the fluorinated fine chemical products field. With the expansion of downstream market demand for fluorinated fine chemicals and support from industrial policies, existing market participants may increase production capacity and new investors may enter the market. As major competitors such as Fujian Kangfeng New Material Chemical Co., Ltd. and Inner Mongolia Dazhong Industrial Chemical Co., Ltd. gradually complete the construction and operation of trifluoromethylbenzene production lines, there is a risk of intensified market competition in the industry. If the company fails to accurately grasp the industry's development trends and further consolidate and enhance its own advantages in product research and development, technological innovation, process optimization, and cost management, it may face the risk of decreasing market share or gross profit margin, negatively impacting the company's profitability.