Metallurgical



1. Introduction to the Project
1.1 Project Background
1.1.1 Product Background
The project is mainly to produce the decoration products of rail train (air ducts, roofs, partition walls, air outlets, luggage racks, side walls, window wall plates, door post cover plates and floors, etc.) and vehicle equipment parts (seats, kitchens, luggage racks, equipment cabin base plates, opening and closing mechanisms, plug sliding doors and gangway doors).
1.1.2 Market Prospect
With the development of the national economy and acceleration of urbanization of our country, the rail transit of our country will still keep the rapid development in the future 5-10 years, which will provide the big market space for the railway vehicle equipment industry. Last year, the construction mileage of the urban railways and light rails in the whole country reached 2600km and the amount of construction investment plan reached 1270 billion yuan. It is predicted that the demand for EMU will have been more than 1300 during the “13th Five-Year Plan” and the railway vehicle equipment manufacturing industry of China will face the important strategic opportunity. Statistics show that the actual delivery of EMU is 153 and the value is 30.6 billion yuan in 2012. CNR achieves the delivery of 85 and CSR achieves the delivery of 68. In 2013, the actual delivery of EMU is 290 and the value is 58 billion yuan. CNR achieves the delivery of 156 and CSR achieves the delivery of 134. In 2014, the actual delivery of EMU is 350 and the value is 70 billion yuan. In 2015, the delivery of EMU is 450 and the value is 90 billion yuan.
In order to actively incorporate into the national “One Belt and One Road” development strategy, seize the construction opportunities of railways and urban rail transit at home and abroad, actively build the railway vehicle equipment industry chain and accelerate the development of the railway vehicle equipment industry, the high-speed railways, intercity railways and urban rail transit will be the key points under construction in the future 5 years. Viewed from the railway market, with the rapid expansion of the domestic economic scale and people’s increasing demands for travels, there still exists big space for growth of the railways of China. It is pointed out in the “12th Five-Year” Development Plan of Railways promulgated in May, 2013 that the operating mileage of railways in the whole country will have been about 0.12 million km, an increase of more than 20000km by 2015. Calculated according to 0.1 billion yuan needed for every 1km railway, the amount of investment will have reached 2200 billion. In the railway construction investment, the expenses for purchase of rolling stock account for 10-15%. In the future years, the domestic market scale of rolling stock will be about 220-330 billion. By now, our country has approved the urban rail transit construction plans of 36 cities and the feasibility research reports of 87 lines under construction of 28 cities and the total mileage of the lines under construction has been 2160km. By the end of the “12th Five-Year” Plan, the operating mileage of urban rail transit in the whole country will have reached 3300km. The domestic policy of rail transit stipulates that the prices of the domestic parts (including those produced by the foreign-funded and joint venture enterprises in China) of rail train purchased by all the cities must be more than 70% of the total. Therefore, in the future years, the demand for rail transit equipment will be very big.  
The construction site of the project is about 100km from Changchun where Changchun Railway Vehicles Co., Ltd. is located, so the project has the advantage of near distance from Changchun Railway Vehicles Co., Ltd. In recent years, Changchun Railway Vehicles Co., Ltd. has achieved the good momentum of development. The data show that Changchun Railway Vehicles Co., Ltd. is the enterprise with the earliest exports and highest quantity of exports in the domestic industry and its products have been exported to 18 countries and regions including the US, Australia, Brazil, Thailand, Saudi Arab, Iran, Singapore, New Zealand, Argentina, Ethiopia and Hong Kong, etc. and accumulated exported quantity of vehicles has been 6000 and the foreign exchange of more than 6 billion yuan has been created. 
On the whole, the project has the good market prospect while enjoying the advantage of near distance from CRC.
1.1.3 Technical Analysis
The project is planned to take the technology of the investment enterprise.
1.1.4 Advantageous Conditions of Project Construction
(1) Policy condition advantages
Implement the cultivation plan of the key matching enterprises of the industrial chain and focus on some matching products of trunk line EMU and urban rail vehicles, etc. to make great efforts to develop the special matching enterprises in a scale harmonious to the technical level of the whole vehicles and meet the development demand of rail transit equipment. In combination with the general spatial layout and development plan of our zone in the future, the rail transit industry chain will be actively extended. The investment promotion policy of “discussion on one item once” is exercised for the investment enterprises.
(2) Technical personnel advantages
The human resources needed for the construction of the project can be available in the local area. There are rich human resources in our city. In the urban area, there are vocational schools, which can train the personnel according to the demands of the enterprises. Our city, with the good industrial development foundation, is only 1h ride to Changchun City, a famous “City of Colleges and Universities” and “Automobile City” in the whole country, so the personnel demand can be met.
(3) Industrial foundation advantages
In Liaoyuan City, there has been a cluster of aluminum processing enterprises in a certain scale. There are 11 aluminum alloy and relevant enterprises, including 6 backbone enterprises, 2 companies listed in the market and 2 enterprises with the output value of more than 1 billion yuan, 3000 practitioners, annual output of about 0.5 million tons of aluminum alloy and deep-processing products and annual output value of more than 3.9 billion yuan. Liaoyuan City has the good location advantages and market environment of developing the aluminum refined and deep-processing. The industrial bases related to aluminum processing in the surrounding include Changchunn Railway Vehicle Base, Changchun Automobile Manufacturing Base, Shenyang Automobile Manufacturing Base, Shenyang Aviation Manufacturing Base, Shenyang Equipment Manufacturing Base, Qiqihar Freight Car Base, Northeast Oil Production Base, Green Food and Medicine Production Base and Changchun Photoelectric Information Industry Base, etc. Neighboring Tongliao-Huolinhe Coal Power and Aluminum Integration Industrial Base in Inner Mongolia, Liaoyuan City has the material supply advantages and good logistic advantages.
(4) Good infrastructural conditions
Around the site chosen for the project are the complete public facilities, “7-connection and 1-leveling” infrastructural conditions and good matching facilities, which have provided the solid foundation for the project construction and saved the project construction funds.
(5) Transport advantages
Liaoyuan has the advantageous location conditions and its capabilities bearing development have been continuously strengthened. Liaoyuan is located in the central belt of two major economic areas, that is, Changchun and Shenyang, 100km from Changchun in the north, 200km from Shenyang in the south, with the No. 303 National Highway and Simei Railway penetrating the whole area, constituting the comprehensive transport system extending in all directions with Liaoxi Railway, Changliao Expressway, Yingmei Expressway, Jicao Expressway and Liaoxi Expressway under the construction as well as Liaochang Railway to be started and becoming the new channel to the sea and overseas in the hinterland of Northeast China.
1.2 Content and Scale of Project Construction
1.2.1 Product Plan and Scale
The project has the annual output of interior decoration parts of 800 EMU and 200 rail train, of which the interior decoration parts of EMU are air ducts, flat roofs, partition walls and luggage racks and those of rail train are mainly roofs and partition walls, etc.
1.2.2 Construction Content
The project covers an area of 40000m2, the construction land of the project is 35000m2 and the building area is 30000m2, with the single floor plant building, 3-floor office compound and 3 production lines.
1.3 Total Investment of the Project and Capital Raising
The total investment of the project is 300 million yuan, including the construction investment of 246 million yuan.
Table 1: Summary Table of the Total Investment of the Project          
 
No.    Expense Name    Amount of Investment    Proportion of Total Investment %    Remarks      
1    Construction investment     24600    82          
2    Interest in the construction period                  
3    Current funds    5400    18          
    Total investment of the project (1+2+3)    30000    100.00         
Note: “RMB10, 000” in the Table shall be RMB.
1.4 Financial Analysis and Social Evaluation
1.4.1 Main Financial Indexes
After the output of the project is reached, the annual sales income will be 269.24 million yuan and the profit will be 81.08 million yuan, with the investment recovery period of 3.7 years (after the tax, including the construction period of 1.5 year) and the investment profit rate of 27%.
Table 2: List of Major Indexes for Forecast of Financial Benefits
 
No.    Name    Unit    Index    Remarks      
1    Business income    10, 000 yuan/a    26924    Normal year      
2    Total profit    10, 000 yuan/a    8108    Normal year      
3    Internal financial yield rate of the investment    %    23    After the income tax      
4    Net financial value (Ic=10%)    10, 000 yuan    758.9    After the income tax (operating period of 10 years)      
5    Recovery period of all the investment (after the tax)    a    3.7    Including the construction period of 1.5 year      
6    Investment profit rate    %    27         
Note: “RMB10, 000” in the Table shall be RMB.
1.4.2 Social Evaluation
The project construction fully supports the industrial structural adjustment of Liaoyuan City, further accelerate the reconstruction of Northeast Old Industrial Base and the rapid development of the industry of Liaoyuan City, promote the economic development of Liaoyuan City, increase the regional economic aggregate and the employments and reduce the social employment pressure. In addition, after the project is completed, it will prominently play the roles of reviving Northeast Old Industrial Base and optimizing the industrial layout of automobile parts of Jilin Province.
1.5 Cooperative Ways
Sole investment
1.6 Construction Site of the Project
Jilin Liaoyuan Economic Development Zone
1.7 The On-going Condition of Project
The cooperative proposal of the project has been established.
2. Introduction to Partner
2.1 Basic Conditions
Name: Management Committee of Jilin Liaoyuan Economic Development Zone
Address: 1633 Caifu Road, Liaoyuan City
2.2 Overview
Jilin Liaoyuan Economic Development Zone is the provincial-level development zone founded in 2001 with the approval of Jilin Provincial Government. It now covers an area of 66.26km2, with the total population of 40716. It has preliminarily established the industrial structure dominated by some industries of processing of aluminum extrusion profiles, new energy, medicine health, textile socks and automobile parts, etc. and gathered a great number of big enterprises with the high technical contents, strong driving capabilities and good growth such as Midas Aluminum Industry Co., Ltd., Liyuan Aluminum Industry, etc. Since the 3rd Plenary Session of the 6th Municipal Committee of the Communist Party of China, Liaoyuan Economic Development Zone, basing itself on its own actual conditions and insisting in the differential development, intensive development and cluster development, has scientifically built the special parks and made great efforts to develop the special industries and achieve the centralization and cluster of advantageous industries.
2.3 Contact Method
Investment Promotion Bureau of Liaoyuan Economic Development Zone 
Contact person: Song Yang
Tel: 0437-3292088 
Fax: 0437-3292081
E-mail: 138755222@qq.com
Website:http://kfq.0437.gov.cn/lydz/index.htm;jsessionid=F8B9EDA1151E2C5DCF631DB9EBC3341D

Contact Method of the Project City (Prefecture):
Contact Unit: Liaoyuan Economic and Technological Cooperation Bureau
Contact Person: Cui Shiwei
Tel: 0437-3528822    13766066922
Fax: 0437-3528822
E-mail: lysjhj@163.com
Website of the City (Prefecture): http://www.lysjhj.cn/

 

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