Duchuang

Warwick Technology Co., Ltd. (hereinafter referred to as "Warwick Technology" or "Company") announced on November 6 that the company recently held a brokerage strategy meeting. At the meeting, Huawei Technologies revealed that,Limited by production capacity, the company’s main focus is still on the automobile business. After the spring and stabilizer bar capacity problems are alleviated, the company will also actively deploy other tracks, actively expand relevant customers, and strive to increase the business income of other tracks, hoping to achieve a balance between the automobile sector and the non-automobile sector in the future.

▲ Screenshot of Huawei Technology Announcement

The following are the main contents of investor relations activities:

1. What is the reason why the overall cash-in-cash ratio in the third quarter is not very high?

A:There are two reasons.First, the upstream of the company is steel mills, all of which are prepayments, and the working capital takes up a lot; Second, the downstream of the company is mainly the main engine factory, with a large amount of accounts receivable, and the account period is 2 to 3 months. At the same time, BYD’s payment method is Di Chain, which is BYD’s own supply chain finance, with strong liquidity but high discount rate.

2. Although the company’s cash receipts are relatively low at present, considering the company’s good year-on-year growth performance, will the cash receipts ratio improve after the scale comes up?

A:The company’s current chain will expire in a part every month, and after this part is added to the working capital, the cash-in ratio will be improved.

3. Have the top five customers of the company changed? Can the income be split?

A:The top five customers of the company have not changed significantly. BYD accounts for the highest revenue ratio, accounting for 28%, Geely for 13%, FAW East Machinery and Nanyang for about 9%, and Great Wall for about 6%.

4. Is the spring mainly supplied by itself?

A:Mainly based on customers’ purchasing decisions, some customers adopt sole supply. The OEM is also slowly changing the two-supply mode into the single-supply mode, so as to better control the quality of the whole vehicle.

5. What is the relationship between the air spring and the coil spring? Can the two be stored in the same car?

A:Air spring and coil spring have different audiences and are products of different tracks. The two will not appear in the same car at the same time, and different suspension systems will be selected in different scenarios.

6. What is the bicycle value of spring and stabilizer?

A:Suspension springs are used in passenger cars, and one car needs four suspension springs. The price of traditional fuel vehicles is between 130-200 yuan, and new energy vehicles will be improved by 30% compared with traditional fuel vehicles. The stabilizer bar needs to be used in front and back of a car, which mainly plays an anti-tilt role in the turning process of the car. The price of traditional fuel vehicles is between 120-160 yuan, and the new energy vehicles will be improved by about 30% compared with traditional fuel vehicles.

7. Is there a difference between a traditional fuel vehicle and a new energy vehicle?

A:Whether it is a spring or a stabilizer bar, there will be differences in design requirements on different models, such as size, strength, stiffness and stress.

8. For the downstream of the spring, cars can occupy more than half of the market. Will the company pay attention to other tracks in the future?

A:Limited by production capacity, the company’s main focus is still on the automobile business. After the spring and stabilizer bar capacity problems are alleviated, the company will also actively deploy other tracks, actively expand relevant customers, and strive to increase the business income of other tracks, hoping to achieve a balance between the automobile sector and the non-automobile sector in the future.

9. The company’s revenue growth in Q2 and Q3 is fast this year, but the automobile industry has not changed greatly. What are the reasons for the company’s revenue growth?

A:On the one hand, the rapid growth of independent brands, their growth led to the growth of the company’s business; On the other hand, from the perspective of the whole industry, the concentration of the industry is constantly improving, and many peers are gradually shrinking or even withdrawing from the market.

10. Is the new energy ratio of the company’s products higher than that of traditional fuel vehicles?

A:At present, new energy vehicles account for 55%, and this proportion will continue to increase.

11. Are the processes of spring and stabilizer similar? For the OEM, will the spring and stabilizer be purchased from the same company at the same time?

A:Both spring and stabilizer belong to the functional parts of automobile chassis, and the materials used are basically spring steel, so the underlying technology has certain commonality logically. Spring and stabilizer are similar in main processes, such as molding, heat treatment, shot blasting, surface coating and so on, and the process logic is very similar. In the main engine factory, stabilizer bars and springs are often tied together, because team members such as purchasing, R&D and so on are closer and more willing to find the same supplier.

12. Does the change of steel price have a great influence on the company?

A:There are two kinds of purchasing modes at the steel mill end, one is the locking price purchasing mode, and the other is the floating purchasing mode. If the subsequent steel price rises, the company will increase the volume in the locked-price procurement mode, and if the subsequent steel price falls, the company will increase the volume in the floating procurement mode.

13. Where is the competitiveness of the company?

A:The company can take root in this field, mainly because of our independent research and development of materials, with many years of technical accumulation and precipitation. Through cooperation with domestic spring steel enterprises, the company will carry out the heat treatment process of spring steel after the master batch is provided by steel mills, thus improving the performance of materials. It has a unique competitive advantage in the market to meet the requirements of high performance and light weight of automobile springs.

14. What is the reason why the gross profit margin of the company decreased slightly in the third quarter, but the net interest rate increased?

A:On the one hand, the reason for the decline in gross profit margin is that there are more customer rebates in this quarter, on the other hand, the freight cost has increased greatly due to limited production capacity. The increase in net interest rate is due to the decrease in expense ratio.

15. At present, the company’s downstream customers are mainly independent brands. Will it develop joint ventures and foreign customers in the future?

A:The company has been actively exploring new customers. With the listing of the company, the company will not only take the initiative to go out, but also have customers to seek cooperation and develop springs and stabilizer bars.

16. What percentage of the company’s customers is the OEM?

A:The main engine factory accounts for about 70%.

17. What is the main reason for the heavy volume in the next year?

A:Both the stabilizer bar and the spring will grow, and the stabilizer bar is the fastest because of its small base.

18. Does M7 supply anything other than suspension springs? Are the models jointly developed by Huawei and Chery available?

A:At present, the company only supplies suspension springs on the M7. Chery and Huawei’s model companies are also involved in the supply.

19. What is the subsequent market share of stabilizer bar?

A:The stabilizer bar is still in its infancy, and the market share will be further improved when the subsequent production capacity is released, which is expected to reach a market share similar to that of suspension springs.

20. In the field of industrial robots, what is the value of a single machine?

A:Our supporting parts for industrial robots are around a group of 1000 yuan.

21. Is the company supplying humanoid robots? What is the approximate value of humanoid robots?

A:The company has done some research on this market and has not officially entered it yet. Humanoid robot spring is a small spring used in joints. Because there is no mass production of humanoid robots in the market, the value of humanoid robots has not yet been finalized.

22. Is humanoid robot technology difficult?

A:The difficulty of the spring lies not in itself, but in the correlation matching with the related parts.

23. Is the brake spring mainly used in trucks?

A:Brake springs are used in commercial vehicles, mainly for export.

24. What is the company’s idea in the next three to five years?

A:The company will not be satisfied with the status quo. Springs are elastic components, and elastic components will have many related components. The company will base itself on its main business, and then slowly extend out to other related fields based on the underlying logic of material research and development.

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Review: Sun Shijian