Recently, the news about Hongxing printing group’s capital increase in Vietnam has unexpectedly not caused waves in the mainland. Perhaps it is the numbness after the frog effect boiled in warm water for a long time, or that this export printing giant with an output value of HK $3 billion has nocare? I didn’t feel sharp for a moment.
At this time, Hongxing’s capital increase in Vietnam under the influence of epidemic drugs is actually a very topical subject. Bao Xiaobian is so itchy that he can’t help but wonder about the big chess game of giants and the little life of printers.
Hongxing printing
Recently, the mainland’s description of Vietnam is as follows: “70000 enterprises have closed down! The largest port has suspended the import and export of containers! Toyota, Nike, Samsung and Foxconn are facing production difficulties due to the blockade“
Under this immersive brainwashing, people in the mainland think that there is basically nothing to do with Vietnam and India for export manufacturing this year, and all orders should be obediently sent to China, so that people selectively ignore the extremely bright foreign trade data of Vietnam and India in the first half of this year.
However, people who are divided in recognition and knowledge never expect that Hongxing printing, which has been testing the water in Vietnam for only more than a year, has risked its poison to increase capital and expand production in Vietnam.
Let’s take a look at the official news of Hongxing: Hongxing printing group (00450) announced on August 5, 2021 that the company increased the production scale of its Vietnamese subsidiary by US $15 million. The capital increase has taken effect after being approved by the people’s Committee of Henan Province, Vietnam. The announcement said that the market demand for high-quality printed matter is increasing and diversified. In order to enhance synergy, enhance competitiveness and promote sustainable development, the company decided to increase capital to accelerate the expansion plan, develop more kinds of products and promote the diversified development strategy of the company’s Vietnam business.
The prosperity of export printing makes the dust of chasing incense
From Hongxing’s announcement, Bao Xiaobian can roughly screen out three information: 1. The demand of the Vietnamese market is expanding; 2. Vietnam has the ability to produce high-end printed matter; 3. The future of Vietnam Hongxing will be sustainable and diversified development.
According to the financial report, the turnover of Hongxing printing group in 2018, 2019 and 2020 was HK $3.277 billion, HK $2.993 billion and HK $2.554 billion respectively, with a significant decline. According to Hongxing’s annual report, the group increased the provision for employee welfare expenditure and the sharp rise in paper prices, resulting in a decrease in gross profit of about HK $100 million in 2018. In addition, significant exchange rate fluctuations resulted in a fair value loss of approximately HK $46 million.
It can be said that the business situation of Hongxing printing in the mainland in recent years is somewhat heroic and shameless. It can save face by making a profit of 1.3 billion yuan only by selling two pieces of land and plant assets in Shenzhen and Wuxi.
The other two Artus and Xingguang, which jointly hold global printing orders with Hongxing, are not much worse. Artus owns the world’s largest monomer printing factory in Heshan, and now has about 10000 employees. The turnover in 2018, 2019 and 2020 are HK $3.19 billion, HK $3.59 billion and HK $3.06 billion respectively. The starlight printing that people looked up to in the past seems to have lost all its light, and its shortage is lamentable, but there is nothing to do.
The momentum of printing southeast flight has not decreased
In fact, the older generation of entrepreneurs really miss the days of exporting and manufacturing flowers and cooking oil before 2008. It is this old feeling that makes them prefer to endure the pain of doubling labor costs, lack of industrial workers and large fluctuations in raw material roller coasters, and also insist on investing in the technical research and development and intelligent transformation of non-standard equipment at no cost.
Over the past decade, Artus, Hongxing and Xingguang have invested heavily in establishing intelligent equipment factories. During this period, exciting news has continuously spread. However, the achievements of the decade of intelligence have not been transformed into a steady stream of overseas orders and real money. The worsening labor shortage, Sino US trade war and uncertain epidemic situation have followed one after another.
Under the balance, the three giants of export printing can only step on two boats. Various sources have proved that the big three have always hoped to take mainland factories as the cornerstone and extend their other foot to Southeast Asia in order to stabilize the impact of Sino US trade friction. Taking Artus, whose 70% of orders came from the United States, as an example, in order to avoid the impact of tariffs imposed by the Sino US trade war, Leo paper products (Vietnam) Co., Ltd. grandly held the Establishment Ceremony of the paper products factory at No. 02, anbai high tech Industrial Park on July 19, 2019.
Unexpectedly, labor shortage, geopolitical risk and COVID-19′s continuous oscillation made the three giants two share war and inner drum, and the crazy rise of raw materials made the whole manufacturing industry disorderly. Making money is becoming more and more difficult and uncertain. Those who are better than Hongxing and Artus are also in a panic.
Businessmen value profits over separation, which has been the case since ancient times! Therefore, we saw Hongxing’s adventurous attack, the order transfer of Artus, and the half hearted of Xingguang, Junsi and GFT. In the faint figure of panic, Bao Xiaobian also foresaw that the rice bowl of the mainland printing industry might be broken.
Post time: Aug-18-2021