The state’s macro-control over the aluminum industry has been strengthened, and Yun Aluminum’s shares have been affected by the pros and cons.
The production technology level of Yun Aluminum's shares has reached the domestic advanced level, the corporate governance structure is sound, and the departments are set up reasonably. However, as the price of raw material alumina rises, profitability declines.
The company's financial status is generally low, short-term solvency has declined, its operating capability is slightly stronger than the industry average, and its profitability is slightly weaker than the industry level.
The purpose of Yun Aluminum's issuance of current-term short-term financing bills is to supplement liquidity. Its main business income and working capital have stronger ability to guarantee short-term short-selling in this period, and there is a bank credit line of 1 billion yuan as a guarantee. Less risky.
Yun Aluminum shares issued short-term financing bonds of RMB 300 million in this round. The main purpose of the raised funds is to supplement liquidity, match liquidity with new production capacity, return some bank loans, and reduce financing costs.
In the previous quarter, Yunluo’s main operating income was approximately RMB 1.4 billion, and the average daily main business income was RMB 15.54 million. The total principal and interest income per day of the financing bonds/average daily average business income was approximately 20 days. It is more reasonable that the 20-day main business income can pay off the debts of the current period short-term financing bills.
In 2005, Yunlu Aluminum's working capital in the previous quarter was RMB 410 million, and the guarantee ratio of working capital to current-term short-term financing bills was 1.38. This indicator was greater than 1, indicating that the working capital's ability to guarantee short-term financing bills in this period was strong.
As of November 2005, the Company signed a comprehensive credit agreement with several domestic banks. The total amount of credit lines obtained from domestic banks was 3.341 billion yuan, and the remaining credit line was 1.057 billion yuan. The remaining credit line has a certain degree of protection for the repayment of short-term financing bills.
The country’s efforts in macro-control of the aluminum industry have increased, and the rising prices of raw material alumina have all caused certain impact on Yun Aluminum’s shares. Although the company has a complete operating management system, but the operating capacity is also higher than the industry level, but its profitability is not ideal, or even below the industry average.
The company issued short-term financing bills in order to improve the liquidity of the company and reduce its financing costs. Although the company's short-term debt-relief capacity has declined, its main business income and working capital have stronger protection for this period's short-term financing bills, and its credit risk is relatively small.