Hongli Group Inc.
Note: “We are not a Chinese operating company, but an offshore holding company incorporated in the Cayman Islands. As a holding company with no material operations of our own, we conduct our operations in China through a series of agreements dated April 12, 2021 (the “Contractual Arrangements”), with a variable interest entity, or “VIE”, Shandong Hongli Special Section Tube Co., Ltd., and its subsidiaries, or collectively, “the PRC operating entities”, and this structure involves unique risks to investors. Neither we nor our subsidiaries own any equity interests in the PRC operating entities under the VIE structure.”
The PRC operating entities are one of the leading cold roll formed steel profile manufacturers in China with respect to function innovation, performance improvement, and customized manufacturing of the products, according to the China Sub-Association for Cold Formed Steel Industries, a professional industrial association. A profile is a specific product designed for a specific use. The PRC operating entities design, customize and manufacture cold roll formed steel profiles for machinery and equipment in a variety of sectors, including but not limited to mining and excavation, construction, agriculture and transportation.
With more than a 20-year operating history, the PRC operating entities have developed customers in more than 30 cities in China and a global network covering South Korea, Japan, the U.S., and Sweden. The customers of the PRC operating entities include large corporations and international enterprises such as Weichai LOVOL Heavy Industry Co. Ltd. (“LOVOL”), SUNGJIN TECH CO., LTD (“South Korean VOLVO”), Shandong Lingong Construction Machinery Co., Ltd. (“SDLG”), and some new customers associated with Katsushiro Machinery Co., Ltd. (“Japan Katsushiro”). Most of the customers have been with the PRC operating entities for an average of 10 years. Most of the main customers of the PRC operating entities increased orders with the PRC operating entities during the fiscal years ended December 31, 2020 and 2019 and for the six months ended June 30, 2021, and based on their new contracts with the PRC operating entities, they will continue to increase their orders in the next 2-3 years.
The PRC operating entities employ a broad array of manufacturing techniques, most importantly cold roll forming (“CRF”) which is the technique used for manufacturing all their products that differentiates the PRC operating entities from other steel pipe manufacturers that employ alternative forming techniques such as extrusion or pull-trusion. CRF is widely used for applications where precise dimension and mechanical tolerances are required.
|Industry:||Custom steel products - manufacturing|
|Address||Beisanli Street, Economic Development Zone Changle County, Weifang Shandong, China 262400|
|Phone Number||+86 0536-2185222|
|View Prospectus:||Hongli Group Inc.|
|Revenues||$16.57 mil (last 12 months)|
|Net Income||$3.03 mil (last 12 months)|
|Price range||$4.00 - $6.00|
|Est. $ Volume||$25.0 mil|
|Manager / Joint Managers||EF Hutton|
|Expected To Trade:|
|Quiet Period Expiration Date:||Available only to Subscribers|
|Lock-Up Period Expiration Date:||Available only to Subscribers|
|SCOOP Rating||Available only to Subscribers|
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