Outline of Development Strategic Plan for 2025 of Zhejiang Hailiang Co., Ltd.

SMM1 30: January 30, Zhejiang Heliang Co., Ltd. (referred to as massive shares) issued its 2025 development strategic plan outline. It proposed that:

Development concept: "not only talking about the benefits of enterprises, but also seeking social merit"

Heliang shares will build an international giant copper processing aircraft carrier enterprise, promote the overall transformation and upgrading of the copper processing industry, continue to eliminate the backward production capacity of the industry; improve product performance and quality, reduce production costs and improve production efficiency. At the same time, in response to national environmental protection requirements, optimize equipment and technology, the implementation of energy conservation and emission reduction work.

The elaboration and promotion of the strategic objectives of Heliang shares in 2025 in four directions:

The main contents are as follows: 1) continue to enlarge and strengthen the main industry of copper processing;

2) extending to the upstream high quality resources and mining enterprises;

3) Transverse development of alloy materials and other colored materials;

4) vigorously build the second main business.

Strategic (economic) objectives

Hailiang shares in 2020 target to achieve a net profit of 1.42 billion yuan, 2025 target to achieve a net profit of 4.3 billion yuan.

Strategic objectives of main Copper processing Industry

By 2025, Heliang shares will become the global leader in the copper processing industry, the main industry output value of 100 billion, copper tube production and sales ranked first in the world, far more than their peers. The voice of the industry is heavier, the bargaining power of upstream and downstream is stronger, the product system is constantly enriched and improved, and the product quality continues to be optimized and improved.

Extending strategic objectives to upstream industries

Due to the lack of some mineral resources in China, Heliang shares will actively seek high-quality mineral and mining resources, to achieve the strategic goal of extending the company's industry upstream.

Strategic objectives of horizontal and downstream extension of Nonferrous Metals Industry

Hailiang has horizontally expanded the processing of alloy materials, aluminum, and other non-ferrous metals, further consolidated its position as an international giant in intelligent construction of nonferrous materials, relied on the platform of the industrial chain, and actively extended downstream through capital export. Enhance the interdependence and dependence between customers and Hailiang, and create a non-ferrous processing industry ecosystem.

Strategic objectives of the second main business

Make every effort to create the second main industry, with high technology, high added value, high rate of return of new materials as the main direction, take the initiative to break through the bottleneck of the development of the main copper processing industry.

Product industry layout index

In order to support the realization of the above strategic economic objectives, Heliang comprehensively evaluates the global market distribution, reasonably distributes the industrial base, optimizes the product structure of the producing area in due course, and formulates the industrial layout plan of Hailiang 2025.

By 2025, the annual sales volume of copper processing materials will be 2.28 million tons, that is, 1.23 million tons of copper tubes, 670000 tons of precision copper rods, 350000 tons of electrical copper rods and 30, 000 tons of pipe fittings, making it the world's largest copper pipe, copper rod and copper bar processing enterprise.

By 2025, according to the distribution of market demand, Hailiang will have completed the industrial layout of the global base one after another, so that there will be production bases in major markets all over the world, in order to better and faster serve customers and "good products." Mass Price "gradually and orderly promote the domestic and foreign markets."

The Core Competitiveness on which the Strategic realization depends

Robust risk management and control capability

Heliang shares adhere to the "only earn processing fees, do not speculate in the copper market" business philosophy, with a complete set of systematic risk control system. The system has been verified in a number of large fluctuations in copper prices and exchange rates, effectively avoiding the risks brought by the rise and fall of copper prices and exchange rates to the operation of enterprises, and maintaining the stable performance growth and benign development of the company.

Strong technical support capability

Through continuous technological innovation and innovation of production equipment and technology, Heliang shares have reached the highest level in the industry, with more than 300 domestic and international patented technologies, and have established a number of industry-leading R & D and innovation centers. The company pioneered a number of leading technologies at home and abroad, such as the integration of high-speed continuous rolling technology for copper tubes for air conditioning and refrigeration, unmanned intelligent manufacturing technology for copper and copper alloy pipe fittings, and so on. The innovation of "high efficiency and short process continuous system integration technology" has led to the overall upgrading of manufacturing technology and equipment in the industry, and the "fusion of copper and copper alloy tube manufacturing technology" has filled in the domestic gap. In order to provide safety and economic guarantee for nuclear power plant, "intelligent manufacturing technology of high precision special copper pipe fittings" is used to provide safety and economic guarantee for nuclear power plant. "High efficiency heat transfer and corrosion resistance internal threaded copper tube forming technology" leads the development direction of internal threaded copper tube in our country, "green low carbon technology" innovation promotes the sustainable development of the industry, and "green low carbon technology" innovation promotes the sustainable development of the industry. The new mode of healthy development of copper processing industry in China has been promoted by "information and intelligence".

Leading fine management capabilities

Hailiang shares "take innovation as the foundation, fine management as the treasure of victory, accurate budget as the first to develop" to establish a comprehensive system of modern production management. The company carries out the fine management work in an all-round way, strengthens the scientific and technological innovation, reduces the cost and increases the efficiency, guarantees the enterprise benefit, is regarded as the "fine management" benchmark enterprise, each key production, the financial index leads the colleague.

Excellent talent gathering ability

Excellent talent team is the core element of the sustained and rapid development of Heliang shares. the company aggregates excellent teams with inclusive mechanism, promotes team improvement with innovative mechanism, and drives team development with perfect incentive. To make it a key factor in the realization of the development strategy of Heliang shares.

Concrete measures to realize the Strategy and the way to promote it

Self-built Base and M & A Enterprises go hand in hand to realize layout expansion

Heliang shares have reserved sufficient and excellent technical, production and management teams, and have independent R & D capabilities for production equipment, technology, etc. the internal organizational structure of the enterprise is reasonable, the operation system is perfect, and the risk management and control is proper. It already has the ability and strength to realize the rapid replication of the industry. In the future, Heliang shares plan to use self-built production base and industry mergers and acquisitions at home and abroad at the same time, in order to achieve their own rapid expansion.

Make good use of the Operation of Capital Market and enhance the effect and benefit of Capital

Heliang shares will fully comply with the rules of the capital market, make full use of the capital market platform, through the flexible use of a variety of capital market tools and methods, optimize the capital and capital structure of the company, and strive to achieve the flexibility and value-added of the company's capital.

Setting up Talent training system and creating the optimal Development platform

Heliang shares have established a management channel, technology channel, skills channel combined with the staff career development route, to provide employees with sufficient development platform and space. At the same time, the company takes the construction of blue-collar post ecosystem as the starting point, creates the internal craftsman spirit, continues to improve the professional quality of employees, takes school-enterprise cooperation as the starting point, pays close attention to the long-term talent demand, and does a good job in the directional training and introduction of talents at all levels. In addition, the company will further optimize the employee incentive mechanism, enrich the short-term + medium-term + long-term multi-structure incentive system, so that the incentive is more targeted, fully mobilize the enthusiasm of employees.

Prepare for the Construction of a large Industrial chain platform to enhance the Competitiveness of products

The company will set up a large-scale copper processing industrial park in China, based on Heliang's own copper processing products, selectively introducing high-quality downstream deep processing enterprises that have synergistic effects with Heliang products and are not suitable for large-scale production of large enterprises. Hailiang give full play to its own big procurement, large funds, large logistics, fine management and other advantages, through a variety of forms of in-depth cooperation with enterprises in the industrial park. Realize the sharing of industrial chain resources in the park, save intermediate costs, do enough scale effect, share multi-win model.

Construction of Copper processing R & D Base to lead the Industry with Innovation

Heliang shares will continue to invest in building a global copper processing R & D base with world-class standards on the basis of having two state-level scientific research condition platforms, and lead the industry with innovation. And the company's copper processing products from the traditional "cost leading competition" to "differential competition", further improve the company's profitability, take the lead in promoting the overall upgrading of the copper processing industry.

Creating "the second main Business" and speeding up the pace of intellectual manufacture of Nonferrous Materials

In addition, Heliang shares will also make every effort to promote the concept of "intelligent manufacturing," taking technological research and development and innovation as the first, equipment and process upgrading as the basis, and artificial intelligence technology as the starting point. Promote the integration of a new generation of information technology and modern industrial manufacturing processes with the non-ferrous metals industry.

Adhere to Green Development and promote Modern Industrial Manufacturing

Heliang shares have always paid attention to the development of circular economy and energy-saving and environmental protection industries, committed to the low carbonation of production processes and product technology, always adhering to the concept of equal emphasis on enterprise development and environmental protection, and committed to creating a better life for the society with high-quality products. It also leaves green mountains and rivers for future generations.

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Zhejiang Hailiang Co., Ltd. (hereinafter referred to as "Hailiang shares" or "Company") has gone through 17 years since its establishment in 2001. it is now a leader in the national copper processing industry and one of the most competitive copper processing enterprises in the world. In the copper processing industry, the company has long been the first to take the lead in the "intelligent" modern industrial development pace, in the past 17 years, constantly emancipate the mind, pioneering and innovative, Shift to a higher end, smarter, more technologically and branded, and more globally competitive.

Hailiang shares: committed to the research and development, production, sales and service of high-grade copper products, one of the most competitive industry leaders at home and abroad, leading the way in the transformation and upgrading of the traditional manufacturing industry, For many years in a row to maintain the ability to lead the industry's profit growth. In the future, under the guidance of the goal of "realizing leap-forward development of non-ferrous materials intelligent manufacturing", Heliang shares should step out of the product end and out of the application end, upgrade the traditional manufacturing to intelligent manufacturing, so as to make further contributions to the social and economic development.

Vision: to become an international giant in the intellectual manufacture of colored materials

Mission: get together to make a difference, Dehui Wanjia

Values: people-oriented, open and innovative, steady and pragmatic, integrity and win-win

Enterprise spirit: honesty, pragmatism, stability, efficiency and excellence

Macro Environment and Market Analysis

Macro Environment of Copper processing Industry

Copper products manufacturing industry (copper processing industry) is an important department in the national economy. copper and copper alloys are widely used in electric power, household appliances, automobiles, construction, electronic instruments, national defense, transportation, marine engineering and other industries. It can be said that copper processing is everywhere, copper products run through modern industrial manufacturing, social construction and daily life at all levels.

With the rapid growth of China's economy, especially the rapid development of copper-consuming industries such as power electronics, communications, automobiles, construction and household appliances, and the realization of the global layout of China's industry, China's copper processing industry ushered in the global market space. However, the copper processing industry is also facing a lot of difficulties:

1) although China is the largest producer and consumer of refined copper in the world, it belongs to the "copper-poor country" because of the limitation of copper concentrate resources.

2) Copper processing industry is faced with the problems of unbalanced industrial structure, insufficient innovation ability, large consumption of social resources and so on. it is urgent to renew, transform and upgrade the copper processing industry as a whole.

3) from the company's copper processing three sub-areas to analyze: copper tube: slow technological innovation, backward production equipment; copper rod and copper row: limited to the "low small dispersion" dilemma, it is difficult to form a scale effect.

Considering the advantages of Heliang's R & D capability, production scale, process equipment and other aspects, Heliang shares can make a significant contribution and promotion in dealing with the huge market demand, helping the industry to eliminate backward production capacity, and integrating and subdividing the field.

Market Analysis of Copper processing Segmentation

After years of development, China's copper processing industry has made great progress, but still faces problems such as unreasonable industrial structure, weak ability of independent innovation, large consumption of social resources, heavy task of energy saving and emission reduction, and so on. China is in the stage of transition from traditional copper processing to modern precision copper processing. the low-cost labor cost advantage relied on in the early stage of the industry has basically disappeared and is facing the trend of development from extensive to intensive.

In the copper processing industry, the main product types involved in Heliang shares are copper tubes, copper rods and copper bars.

1) Copper tube

It is mainly used in air conditioning and refrigerator refrigeration, building HVAC, seawater desalination and other fields. Enterprises for new equipment, new technology, new materials research is less, the overall technological innovation is slow, the industry is mostly backward production capacity.

2) Copper rods

Widely used in hardware bathroom, refrigeration accessories, locks and other fields. Because the manufacturing process is simple, the entry threshold is on the low side, the small workshops are mostly, belong to the cost-oriented industry, the whole presents "the production capacity is low, the scale is small, the distribution is scattered" and so on.

3) Copper row

It is mainly used in power generation system and transmission and distribution field. the processing technology is simple. the similar copper rod in the industry presents the present situation of "low, small and scattered". There are no leading enterprises in the industry.

According to the analysis and statistics of IWCC and other related market data, the company estimates that the global market demand for copper tubes, copper rods and copper bars will reach 2.845 million tons, 4.038 million tons and 3.115 million tons respectively.

The above three copper processing subdivision fields are widely used, and are closely related to the national economy and people's livelihood. However, due to the limitation of backward domestic technical capacity and outdated equipment level, the industry is unwilling to invest too much in technical research and development and production equipment, and copper tubes, copper rods, and copper rows cannot form a large-scale production effect. Quality has also been stagnant, leading to the strange phenomenon of imbalance between supply and demand quality.

On the one hand, copper tube, copper rod and copper bar products have a huge market demand, on the other hand, the industry as a whole presents a "low, small, scattered" bad situation. Under the situation of this industry, Heliang shares have made full layout preparations at many levels, such as R & D capacity, production scale, process equipment, and so on. in the face of huge market demand, Heliang shares will integrate and subdivide areas to help the industry eliminate backward production capacity. Improve the technical content and quality of the three categories, promote the copper processing industry from quantitative change to qualitative change, to a new stage.