On the evening of June 17th, according to business information, global chip giant Intel recently invested in Dongguan Lixun Technology Co., Ltd., a subsidiary of A-share fruit chain leader Lixun Precision (002475).
Insiders confirmed this change to Securities Times · e Company reporters. And it was revealed that this cooperation between the two parties will focus on the communication and data center business areas of Lixun Precision; After cooperation, it will help enhance the competitiveness of Lixun Precision related products.
On June 17th, the stock price of Lixun Precision rose 7.71%, reaching a closing price of 37 yuan per share, with a total market value of 265.7 billion yuan. Industry insiders believe that the sharp rise in stock prices may be related to Intel's investment.
Specifically, on June 17th, according to the Qichacha APP, Dongguan Lixun Technology Co., Ltd. (hereinafter referred to as "Dongguan Lixun Technology"), a subsidiary of Lixun Precision, recently underwent a business change, with the addition of Intel (China) Co., Ltd. as a shareholder. At the same time, the registered capital increased from approximately RMB 571 million to approximately RMB 589 million.
The reporter found that Dongguan Lixun Technology was established in 2017 and is a provider of communication facilities and enterprise level interconnection products. It mainly produces and operates communication equipment such as base station antennas, filters, RRUs, as well as interconnection products such as connectors, connection lines, optical modules, and AOCs. It covers application areas such as wireless communication base stations, data centers, servers, switches, routers, and provides complete interconnection solutions from wireless connections to electrical connections, optical connections, thermal management, and more. At present, A-share listed company Lixun Precision holds 89.22% equity in Dongguan Lixun Technology.
According to the 2023 annual report of Lixun Precision, the company mainly engages in four major business segments: consumer electronics, communication and data center, automotive, and medical. Among them, the consumer electronics business achieved a revenue of 1972 billion yuan, accounting for 85% of the revenue. In addition, communication interconnection products and precision components achieved a total revenue of 14.54 billion yuan, accounting for 6.27% of the revenue, an increase of 13.28% year-on-year.
Intel is a global leader in the semiconductor industry and computing innovation, founded in 1968 with a revenue of $63.1 billion in 2022. Statistics show that in the fourth quarter of 2023, the shipment volume of Intel PC processors reached about 50 million units, a year-on-year increase of 3%, and the market share reached 78%.
However, nowadays, Intel is transforming into a data-centric company, working with partners to drive innovation and application breakthroughs in cutting-edge technologies such as artificial intelligence, 5G, and intelligent edge, driving the world of intelligent connectivity. Recently, Intel announced the launch of the next generation data center processor CPU Xeon and AI PC processor Lunar Lake; In addition, the AI accelerator Gaudi 3 released in April was used to handle generative artificial intelligence training.
"This cooperation does not involve the field of consumer electronics, but mainly involves cooperation in the communication field. In the future, the products of Lixun Precision in this field will be deeply bound to Intel chips, for example, during the product development stage, both parties will engage in deep cooperation." On the evening of June 17th, an insider revealed to a reporter from Securities Times · e Company.
Industry insiders told reporters that the transmission rate and bandwidth of communication related products are essentially strongly related to the chips they use. Therefore, Intel's investment in the subsidiary of Lixun Precision will help enhance the competitiveness of Lixun Precision's communication and data center products, and help the business develop rapidly.
It is understood that at present, the business of Lixun Precision Communication and Data Center mainly involves copper connections, optical connections, heat dissipation modules, servers, and communication RF products. From 2021 to 2023, the revenue share of Lixun Precision Communication Interconnection products and precision components has shown a continuous upward trend, with revenue of 2.12%, 6%, and 6.27% respectively.
In its 2023 annual report, the board of directors of Lixun Precision also mentioned that "in 2023, the communication industry has ushered in new development opportunities in the wave of global digital transformation. The company's business in areas such as copper connections, optical connections, heat dissipation modules, servers, and communication RF has also shown significant growth trends, becoming an important driving force for industry development.".
As for the specific investment amount, according to business information, after Intel's investment, the registered capital of Dongguan Lixun Technology Company will increase by about 17 million yuan. An investment insider told reporters that 17 million yuan is only the number of shares and not the actual investment amount. The specific investment amount depends on the unit price of the shares.
Source: Company e