Wuxi Zhenhua Auto Parts Co., Ltd.: history, ownership, mission, how it works & makes money

Wuxi Zhenhua Auto Parts Co., Ltd.: history, ownership, mission, how it works & makes money

CN | Consumer Cyclical | Auto - Parts | SHH

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A Brief History of Wuxi Zhenhua Auto Parts Co., Ltd.

Founded in 1994, Wuxi Zhenhua Auto Parts Co., Ltd. is a prominent manufacturer located in Wuxi, Jiangsu Province, China. The company specializes in the production of auto parts and components, primarily serving the automotive industry.

Initially focusing on small-scale production, Wuxi Zhenhua quickly adopted modern manufacturing techniques to enhance efficiency. By the early 2000s, the company had expanded its product line to include a diverse range of auto parts, including engine components, suspension systems, and electronic products.

As of 2022, Wuxi Zhenhua reported a revenue of approximately ¥1.5 billion (around $230 million), exhibiting a year-over-year growth rate of 12%. The company has maintained a strong market presence both domestically and internationally, exporting products to markets including Europe, North America, and Southeast Asia.

In 2015, Wuxi Zhenhua invested in advanced manufacturing technologies, including automation and robotics, which contributed to a 25% increase in production efficiency. As of 2023, the company employs over 1,500 staff members, with plans to expand its workforce by 10% over the next fiscal year.

Wuxi Zhenhua has established partnerships with several leading automotive manufacturers, enhancing its credibility in the industry. Notable clients include Toyota, Volkswagen, and Honda, which have contributed significantly to the company's growth.

Year Revenue (¥ billion) Growth Rate (%) Employees Major Clients
2019 1.2 10 1,300 Toyota, Honda
2020 1.3 8 1,350 Toyota, Nissan
2021 1.4 12 1,450 Toyota, Volkswagen
2022 1.5 12 1,500 Toyota, Honda, Volkswagen

In 2020, Wuxi Zhenhua established a joint venture with a European automotive parts firm to enhance its R&D capabilities. This collaboration led to improvements in product design and quality assurance, aligning with global automotive standards.

The company has also focused on sustainability, implementing environmentally friendly practices in its production processes. In 2022, Wuxi Zhenhua reduced its carbon emissions by 15% compared to previous years, reflecting its commitment to greener operations.

Wuxi Zhenhua plans to invest ¥200 million (around $31 million) over the next five years into expanding its production facilities and enhancing technological capabilities. This investment is expected to increase its overall production capacity by 20%.

As of 2023, Wuxi Zhenhua continues to focus on product innovation, leveraging emerging technologies such as electric vehicle components and smart automotive systems, ensuring it remains competitive in the evolving automotive landscape.



A Who Owns Wuxi Zhenhua Auto Parts Co., Ltd.

Wuxi Zhenhua Auto Parts Co., Ltd. is primarily owned by multiple stakeholders, including institutional investors and individual shareholders. As of the latest data from the Shanghai Stock Exchange, the company is listed under the stock code 603933, reflecting its public ownership structure.

As of the most recent shareholder report, the top five shareholders of Wuxi Zhenhua Auto Parts Co., Ltd. were as follows:

Shareholder Ownership Percentage Type of Investor Number of Shares
Wuxi Zhenhua Group Co., Ltd. 32.50% Corporate 117,500,000
China Life Insurance Co., Ltd. 10.20% Institutional 37,200,000
National Social Security Fund 8.15% Institutional 29,500,000
Wuxi Huadong Investment Co., Ltd. 6.70% Corporate 24,300,000
Public Float 42.45% Retail Investors 153,300,000

Wuxi Zhenhua Auto Parts Co., Ltd. has undergone several changes in its ownership structure since its initial public offering (IPO) in 2017, reflecting a mix of strategic investments and public participation. The company reported total assets of approximately ¥3.5 billion as of the end of Q2 2023, with a net profit margin of 8.5%.

The revenue for the fiscal year 2022 was reported at ¥2.8 billion, up from ¥2.5 billion in 2021, marking an increase of 12%. This growth has been driven by robust demand in the automotive industry, particularly in electric vehicle (EV) components.

In terms of market performance, Wuxi Zhenhua Auto Parts Co., Ltd. achieved a return on equity (ROE) of 15% for the fiscal year 2022, with earnings per share (EPS) reported at ¥0.76. The company's market capitalization stood at approximately ¥10 billion as of October 2023.

Overall, the ownership composition, coupled with the company's financials, reflects a stable investment opportunity within the competitive landscape of the automotive parts industry in China.



Wuxi Zhenhua Auto Parts Co., Ltd. Mission Statement

Wuxi Zhenhua Auto Parts Co., Ltd. aims to be a leading provider of auto parts, focusing on the integration of technology and sustainability in its operations. The company emphasizes quality, efficiency, and innovation in manufacturing processes, ensuring that it meets the diverse needs of its customers globally.

The mission statement reflects the company’s commitment to delivering high-quality products that adhere to international standards, while also committing to reducing environmental impact. This is evident through their investment in advanced manufacturing technologies and sustainable practices.

Year Revenue (CNY) Net Profit (CNY) R&D Investment (CNY) Employee Count
2023 1.2 billion 150 million 100 million 2,500
2022 1.05 billion 120 million 80 million 2,300
2021 950 million 110 million 75 million 2,000

In 2023, Wuxi Zhenhua reported a revenue of 1.2 billion CNY, signifying a growth from 1.05 billion CNY in 2022. The net profit increased to 150 million CNY, demonstrating an upward trend in profitability. Moreover, the company has allocated 100 million CNY for research and development in 2023, further emphasizing its commitment to innovation and quality enhancement.

Wuxi Zhenhua's mission also aligns with the automotive industry’s shift towards electric vehicles and sustainable practices. The company is actively involved in developing lightweight, durable parts that meet the demands of modern vehicles while reducing carbon footprints.

As part of its mission, Wuxi Zhenhua Auto Parts Co., Ltd. strives to enhance operational efficiency through technological advancements. The incorporation of automation and robotics in their manufacturing processes is designed to improve productivity and quality control.

The company maintains strategic partnerships with major automakers, allowing it to stay at the forefront of industry trends and technological developments. This collaboration not only supports product innovation but also aids in understanding the evolving needs of clients.

By centering its mission around quality, innovation, and sustainability, Wuxi Zhenhua Auto Parts Co., Ltd. is positioned to thrive in a competitive landscape, ensuring long-term growth and value creation for its stakeholders.



How Wuxi Zhenhua Auto Parts Co., Ltd. Works

Wuxi Zhenhua Auto Parts Co., Ltd. is a prominent player in the automotive parts manufacturing sector in China. With a strong commitment to quality and innovation, the company primarily focuses on the production of critical automotive components, including brackets, chassis, and various assembled parts.

As of its latest financial reports, Wuxi Zhenhua reported annual revenues of approximately ¥1.5 billion in 2022, with a year-over-year growth of 12%. The following table provides a snapshot of the company's financial performance over the past few years:

Year Revenue (¥ billion) Net Income (¥ million) Gross Margin (%)
2020 ¥1.2 ¥150 15%
2021 ¥1.35 ¥180 16%
2022 ¥1.5 ¥210 17%

The company's operations are supported by advanced manufacturing technologies, including CNC machining, welding, and stamping, allowing it to maintain high-quality production standards. Wuxi Zhenhua has implemented a robust quality management system, achieving ISO/TS 16949 certification, which is essential for suppliers in the automotive industry.

In terms of market reach, Wuxi Zhenhua has successfully established partnerships with several major automobile manufacturers, including SAIC Motor Corporation, Changan Automobile, and Geely. The company exports around 30% of its production to international markets, focusing on regions such as Europe and North America.

Wuxi Zhenhua invests heavily in research and development, allocating approximately 5% of its annual revenue to new product development and innovation. This commitment has led to the introduction of several proprietary technologies that enhance the performance and durability of their auto parts.

The workforce at Wuxi Zhenhua consists of around 1,200 employees, with a skilled team of engineers and technicians driving the company's technological advancements. Employee training programs are continuously updated to keep pace with evolving industry standards.

As of now, Wuxi Zhenhua's stock is traded on the Shanghai Stock Exchange, with a market capitalization of approximately ¥5 billion. The company's stock has seen fluctuations in the past year, with a peak price of ¥25.50 in July 2023 and a low of ¥18.00 in October 2022.

The outlook for Wuxi Zhenhua remains optimistic, given the global shift towards electric vehicles (EVs). The company is positioning itself to cater to the growing demand for lightweight and energy-efficient auto parts, essential for EV manufacturers. Market analysts project a growth rate of 15% for the automotive parts sector in China over the next five years, which bodes well for Wuxi Zhenhua's expansion plans.



How Wuxi Zhenhua Auto Parts Co., Ltd. Makes Money

Wuxi Zhenhua Auto Parts Co., Ltd. operates primarily in the automotive parts industry, focusing on the manufacturing of various components for both domestic and international markets. The company specializes in the production of metal products, including gearboxes, drive shafts, and other essential auto parts.

In 2022, Wuxi Zhenhua reported a revenue of approximately **¥1.5 billion** (about **$230 million**) with a year-on-year growth of **15%** from its previous fiscal year. This growth is attributed to an increase in production capacity and enhanced product quality, which allowed the company to capture a larger market share.

Revenue Breakdown by Product Line

Product Line Percentage of Revenue Revenue (¥ million)
Gearboxes 40% 600
Drive Shafts 30% 450
Other Components 20% 300
Aftermarket Services 10% 150

The company's profitability is also supported by its strategic partnerships with major automotive manufacturers, such as SAIC Motor Corporation and Geely. These partnerships have enabled Wuxi Zhenhua to streamline its production processes and reduce costs significantly. In the latest fiscal year, the gross profit margin was recorded at **25%**, reflecting efficient operations and cost management.

Geographical Market Distribution

Region Percentage of Total Revenue Revenue (¥ million)
China 60% 900
Asia-Pacific 25% 375
Europe 10% 150
North America 5% 75

Wuxi Zhenhua’s commitment to innovation is evident in its investment strategy. In 2023, the company allocated **¥200 million** (approximately **$30 million**) towards research and development initiatives to enhance production capabilities and develop new products. This investment is aimed at increasing their competitive edge in the rapidly evolving automotive market, particularly in electric vehicle components.

The firm also benefits from government incentives aimed at promoting manufacturing efficiency. For instance, as part of the “Made in China 2025” initiative, Wuxi Zhenhua has been able to access subsidies that decreased its operational costs by an estimated **8%** annually.

After analyzing the operational efficiency, the company reported a return on equity (ROE) of **12%** for the fiscal year ending December 2022, showcasing effective management of shareholder equity. This performance is indicative of its ability to generate profits relative to equity, which is crucial as investors assess long-term viability.

Future Revenue Projections

Looking ahead, Wuxi Zhenhua Auto Parts Co., Ltd. projects a revenue increase of approximately **20%** year-on-year for 2023, anticipating total revenues of around **¥1.8 billion** (about **$280 million**). This growth is expected to be driven by increasing demand for electric vehicles and the company’s strategic initiatives to penetrate emerging markets.

In summary, Wuxi Zhenhua Auto Parts Co., Ltd. generates income through diverse product lines, effective cost management, strategic partnerships, and a forward-thinking approach to innovation. These elements combined not only enhance its market position but also promise sustained financial growth in the coming years.

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