Introduction to the main contents of investor relations activities
First, please introduce the market size of the cutting tool industry
The domestic cutting tool market is about 4 billion, of which about 53% are cemented carbide tools. Among them, the tool consumption scale of large customers is about 1 billion. Take the aerospace industry as an example, the engine models are different, the parts will be very different, and many non-standard tools are needed.
second, please introduce the main tool materials
Tool materials mainly include tool steel, cemented carbide, ceramics and superhard materials, among which cemented carbide has higher hardness, wear resistance and red hardness compared with high-speed steel, and higher toughness compared with ceramics and superhard materials. Because cemented carbide has good comprehensive properties, it is widely used to process steel (P), stainless steel (M), cast iron (K), nonferrous metal (N), heat-resistant steel (S) and hardened steel (H). According to the statistics of "Data Analysis Report of the Fourth Cutting Tool User Survey", by the end of 218, the proportion of cemented carbide cutting tools used in China's machining industry was 53%.
Third, please introduce the performance index of the tool.
The cemented carbide NC tool usually includes two dimensions: material performance and cutting performance, in which the material performance includes hardness and impact toughness. Generally speaking, the higher the hardness, the worse the impact toughness, and it is usually necessary to balance the hardness and toughness according to the specific application field of the tool. Cutting performance includes durability, machining efficiency and machining accuracy. The core products of the company have reached the domestic advanced level in cutting performance such as machining accuracy, machining efficiency and service life, and have entered the domestic high-end market occupied by tool enterprises in Europe, America, Japan and South Korea for a long time, especially the milling blades have formed a significant competitive advantage.
iv. Please introduce the competition pattern of the tool industry
At present, the competition pattern of the international tool industry is roughly divided into three camps. The first camp is the European and American tool enterprises represented by sandvik. The European and American tool enterprises are positioned to provide customers with complete tool solutions, and their product systems are constantly promoted through strong R&D investment, personnel training and quality management system, and they are at a continuous leading level in technology, always occupying a leading position in the field of high-end customized tools, and the market presents oligopoly competition. The second camp is Japanese and Korean tool enterprises represented by Mitsubishi Materials. Japanese and Korean tool enterprises are positioned to provide customers with products with high versatility, good stability and high cost performance, and have won the favor of many manufacturers in the field of non-customized tools in high-end manufacturing. The third camp is a domestic tool enterprise represented by Zhuzhou Diamond, which has a large number and a big gap in competitive strength. It has won more low-end market share mainly through differentiated product strategies and price advantages.
At present, the main gap between domestic tools and imported high-end tools is reflected in the stability and consistency of products and the ability to provide overall cutting solutions, so the competition of future tool enterprises is mainly reflected in technical competition.
V. Please introduce the differences between the company and domestic competitors in the same industry.
Wald mainly uses superhard tools, Hengfeng tools mainly use high-speed steel tools, Ou Ke billion includes cemented carbide products and cemented carbide CNC blades, and the company mainly uses cemented carbide CNC blades.
VI. Please introduce the development history of the company.
From 27 to 211, the company seized the rapid development opportunities of automobile, construction machinery, energy equipment and rail transit industries, and provided customers with non-standard customized cemented carbide tool products, mainly in direct sales mode, according to the cutting application needs of terminal customers such as Taiyuan Heavy Industry, Dongfang Electric and citic heavy industries.
In 212-216, due to the complicated demand for knives of terminal customers and the long payment period, the company adjusted its business development direction in time, and gradually transformed from "providing non-standard customized products for large customers" to "standard products meeting the metal cutting needs of many small and medium-sized machining enterprises". In view of the characteristics of the standard tool product market, such as large consumption, concentrated varieties, strong versatility and fierce market competition, the company adopted the research and development strategy of "concentrating advantages and breaking through single products" to develop products with high cost performance advantages such as die milling cutters and grooved blades. At the same time, it began to transform into a distribution model.
since 217, the cutting performance of the company's core products has been at the domestic advanced level in terms of machining accuracy, machining efficiency and service life, and it has entered the domestic mid-to high-end market occupied by European, American, Japanese and Korean tool enterprises for a long time. The company has successively launched a series of products of "Hard Stone" and "Hardstone" with unique matrix materials, groove structure and coating technology, which quickly gained high recognition from the market. At the same time, the store model was introduced to further improve the sales network.
since January, 22, novel coronavirus epidemic broke out at home and abroad, and the import business of some high-end CNC blades in Europe, America, Japan and South Korea was hindered, which affected the timeliness and stability of their supply to end customers. A group of outstanding domestic tool enterprises represented by the company have further accelerated the substitution of high-end imported tool products by virtue of their product performance and service advantages.
VII. Please introduce the reasons why the company changed from direct selling mode to distribution mode.
Due to the complicated demand for knives from terminal customers and the long repayment period, the company adjusted its business development direction in a timely manner, and gradually changed from "providing non-standard customized products for large customers" to "standard products meeting the metal cutting needs of many small and medium-sized machining enterprises". In view of the characteristics of the standard tool product market, such as large consumption, concentrated varieties, strong versatility and fierce market competition, the company adopted the research and development strategy of "concentrating advantages and breaking through single products" to develop products with high cost performance advantages such as die milling cutters and grooved blades.
in order to meet the needs of small and medium-sized machining enterprises with wide distribution and different scales in China, the company directly sells its products to dealers in large-scale tool wholesale markets and surrounding areas of large-scale industrial clusters, and gradually gets rid of the dependence on large customers, and initially builds a sales network covering three major tool distribution markets and regional industrial clusters in South China, East China and North China.
VIII. Please introduce the company's dealer store model.
The dealer store model belongs to the distribution model, which refers to the distribution mode in which dealers open stores to promote the company's products. Dealer's exclusive store model is the extension and broadening of the company's existing distribution channels, which makes the company's products closer to the market and the terminal, effectively enhances the market influence, and collects and feeds back the end users' demand for knives through exclusive stores < P > IX. Please introduce the company's superior products < P > The company's mold milling cutter has a high reputation and influence in the domestic mold high-speed milling field. In 217, the company's die milling blades won the "Jung Technology Innovation Award", and in 219, the company's cutting edge series cemented carbide CNC blades won the "Jinfeng Award" (the first cutting tool innovation product award).
X. Please introduce the pricing factors of the company's products.
On the basis of production cost, the company determines the final selling price by combining product performance, competitive pricing, market conditions, customer purchasing scale, competitive strategy and other factors.
Xi. Please introduce the main technologies involved in tool production and the technical development of the company in recent years.
Cemented carbide CNC blades are technology-intensive industries, and their technologies are mainly concentrated in four fields, namely, matrix materials, groove structure, precision molding and surface coating, involving many disciplines such as physics, chemistry and material science. Taking the field of matrix materials as an example, with the continuous emergence of new materials used in workpieces, different requirements will be put forward for the performance of tools used in machining workpieces, and this differentiated demand will have different requirements for the performance of matrix materials. However, the properties of raw materials, such as particle size distribution, carbonization degree, crystal structure, agglomeration state, surface defects, etc.), composition ratio (hard phase content, binder phase content, third phase ratio, strengthening and modifying component addition, etc.), organizational structure (gradient structure, submicroscopic structure, twin crystal structure, etc.) and subsequent processes will all have different effects on the properties of matrix materials, so higher requirements are put forward for the technical level and research and development ability of enterprises.
at present, the company's core technology level is at the domestic advanced level, and in recent years, it has made certain progress in the research of complex precision forming, cermet materials and nano-coating materials.
XII. Please introduce the production mode of the cutter.
The cutter production mainly includes batching, ball milling, spray drying, press forming, sintering, grinding and deep processing, coating and other processes. The standard production cycle is generally about 5-7 weeks, so the company sets a moderate safety stock for products with stable market demand to quickly respond to customer demand.
XIII. Please introduce the measures taken by the company against the fluctuation of raw material prices.
The company has taken the following main measures against the fluctuation of raw material prices: (1) Consolidate, expand and establish a closer long-term cooperative relationship with major raw material suppliers, control the raw material cost by signing a framework agreement and locking the price and quantity in advance, so as to obtain a more favorable purchase price in the market and avoid the negative impact on production and operation caused by the rise of upstream raw materials; (2) Continuously optimize the product structure and win by relying on technological advantages. Compared with products that occupy the market by relying on low-cost competitive strategy, the company's products are not easily affected by fluctuations in raw material prices, and the company's production and operation risks are also low. (3) Increase investment in production equipment, introduce advanced mechanical equipment at home and abroad, and implement high-quality control standards, so as to reduce raw material consumption, improve output rate and reduce scrap rate, and achieve the purpose of improving the gross profit margin of single-piece finished products. (4) The company's procurement staff inquires about raw material prices through public information, makes price comparison inquiry among multiple suppliers, tracks the changing trend of raw material prices in time, and reduces the risk of raw material price fluctuation.
XIV. Please introduce the R&D mode and R&D team of the company.
The company has set up a complete R&D mode, which is planned and guided by the deputy general manager, chief engineer and chief craftsman in charge of R&D, and implemented by the design department, technology department and material department, and has determined two important R&D directions: basic research and new product development. The company's R&D process includes four stages: demonstration, design, development and testing, and adopts the R&D strategy of "concentrating advantages and breaking through single products". After the basic research and new product development projects are approved, all departments under the company's R&D system will cooperate and jointly develop, fully mobilize the internal and external factors of R&D and production to continuously promote technological progress.
at the same time, the company has built a team of R&D talents with reasonable gradient, complete disciplines and solid professional skills, covering the four core fields of cemented carbide CNC blade manufacturing, especially the chief engineer Gao Ronggen has established the company's leading position in the field of cemented carbide CNC blade matrix materials.
XV. Please introduce the company's future development strategy
In the future, the company will further consolidate and give full play to its advantages in technological innovation and product development, increase R&D investment and talent team building, take technology as the market-oriented, constantly upgrade iterative products and develop new series. On the basis of consolidating the dominant position of cemented carbide CNC blades in the market, we will give priority to the research of basic material technology and enter the field of new materials such as cermets, ceramics and superhard materials; At the same time, through the development of new products, we will expand into the field of tool systems and precision and complex combination tools, further enriching the company's product line. By continuously improving the comprehensive metal cutting service ability for large and medium-sized enterprises, the company will become a leading supplier of integrated cutting solutions in China from a company that only provides cutting products.
XVI. Please introduce the company's future development plan
1. Market expansion plan
Gradually implement product development plans for different markets, industries and customers: in order to meet the urgent transformation needs of domestic tool trading companies, accelerate the layout of domestic circulation market, establish and improve the layout of first-class specialty stores and sales networks for "Hardstone" series products, and actively explore overseas markets and improve the layout of dealers in overseas circulation markets; Around large-scale industrial clusters, there are plans to develop and lay out distributors of "Hard Rock" series products, so that the company's products and technologies can be further close to the needs of machining end users and deeply integrated with various industrial clusters; Strive to reach strategic cooperation with key customers in some key industries in China, build "Huarui" brand in an all-round way, and launch customized overall cutting solutions and application services.
2. Technology upgrading plan
The company has always adhered to independent innovation, and continuously increased R&D investment to improve the R&D level; At the same time, we will strengthen close cooperation with scientific research institutions, establish a joint cooperation platform between schools and enterprises, and improve the basic research level of the company. On the one hand, the company will continue to increase the basic research work on new matrix materials and new coating technology, on the other hand, it will continue to increase the development of new products, improve the comprehensive performance of products, and provide customers with reliable and cost-effective cutting tools.
3. talent development plan
the company will strengthen the cultivation and introduction of outstanding talents, fully implement the strategy of strengthening enterprises through talents, and strive to create a new employment mechanism and policy environment. First, speed up the training of talents, attach importance to continuing education and training, improve the incentive and training mechanism of talents, and cultivate a group of technical backbones and management talents who adapt to industrial upgrading; Second, strive to create a good environment for the growth of talents, respect talents, fully mobilize their enthusiasm and creativity, and make the best use of talents; The third is to strengthen human resource management, strengthen the construction of high-level talents and establish an effective human resource incentive mechanism.
4. Financing plan
The precision and high-efficiency tool industry is a capital-intensive industry, and sufficient funds are an important guarantee for reducing enterprise costs, improving enterprise competitiveness and risk resistance, and maintaining the leading position in products and technology. In the future, according to the actual needs of business development, the company will launch a refinancing plan in a timely manner, and expand financing channels through multiple channels on the premise of fully ensuring the interests of shareholders, especially small and medium shareholders, so as to maintain a reasonable asset-liability structure.
Attachment: Activity Information Form
(This manuscript was completed by the robot "Aauto Quicker Xiao E" of Securities Times E Company. )