Zhejiang'S Winter Is A Bit Cold In Winter.

As the global economic crisis has gradually spread to the real economy, the decline in textile industry demand is an indisputable fact. This year's textile industry turnover of the Guangzhou Trade Fair has shown a sharp decline in the industry's "winter" approaching.

The shrinkage of the textile industry will reduce the demand for dyestuffs. As the largest producer of disperse dyes and 40% of the domestic market share in Zhejiang, Longsheng has been announcements since 60035211, mainly related to the issue of "changing the use of proceeds".

In November 13th, Zhejiang Longsheng announced that the company intends to change the amount of 250 million 950 thousand yuan involved in the technical pformation project of "20 thousand tons of high-grade and environment-friendly reactive dyes" with the annual output of 250 million 950 thousand tons, all of which will be used to repay the loan to the bank for the acquisition of Longhua in Zhejiang.

The announcement also said that the company intends to continue to use 450 million yuan idle funds to temporarily replenish the working capital, and the term of use will not exceed 6 months, from December 1, 2008 to May 31, 2009.

Two days later, the company also said that Ruan Weixiang, the chairman and general manager of the company (the second largest shareholder, owns 8.69% of the company's shares) had passed the proposal to change the annual output of 5000 tons of the project to supplement the working capital.

These three bills are all around the company's funds raised last year.

In November 2007, the company issued additional shares, the net amount actually raised was 1 billion 116 million 481 thousand and 700 yuan, and the fund-raising funds were mainly used for four projects, such as aromatic amine series products, reactive dyes and so on.

However, most of the fund-raising funds have not been invested in the above projects. For example, the annual output of 20 thousand tons of high-grade, environmentally friendly reactive dyestuff renovation projects involved 250 million 950 thousand yuan in raising funds. By the end of 10 2008, the project had invested only 30 million 517 thousand yuan.

"The annual output of 5000 tons of para ester project" involves raising funds of 48 million 900 thousand yuan, but so far, no funds have been raised to raise "one cent".

"In fact, when the company successfully raised a large amount of funds during the rush hour last year, the actual use of funds was very low. At the beginning of the crisis of textile industry in Zhejiang, Longsheng had a premonition that the crisis was inevitable and almost stopped all cash usage. Now the company expects to get through the" winter "by means of cash that changes the use of fund-raising funds.

An industry analyst who asked not to be named told reporters.

Compared with other enterprises with limited funds, Zhejiang Longsheng, who has obtained ample cash by changing the purpose of raising funds, appears to be the "lucky man" under the shadow of the financial crisis.

In the early November, when our reporter interviewed the Tenth China Plastics Expo in Yuyao, Zhejiang, many owners of related industries complained that "the textile industry in Zhejiang is the first to bear the brunt of the impact of the international financial crisis. Lack of money is a common disease. Many enterprises are hard to get through this" winter "." the situation in Shaoxing is more serious, and the textile printing and dyeing industry has long been "like a year off" because of the fragmentation of its capital chain.

Despite the high cost and low price "double pressure", Zhejiang Longsheng still faces "double pressure" of high cost and low price, despite its abundant cash.

As of September 30th, Zhejiang Longsheng inventory reached 812 million 676 thousand and 700 yuan, which is far higher than the company's nearly 500 million yuan of accounts receivable.

A person familiar with the chemical fiber industry in Zhejiang province explained to our newspaper reporter: "(Zhejiang Long Sheng hoarded a large quantity of raw materials before the Olympic Games, that is, when the oil price was high, now the demand for the downstream is extremely shrinking, and the price of disperse dyes has dropped to less than 20 thousand yuan. Now the company is digesting the huge stock. According to the present situation, it is hard to say when to finish the stock.

The textile industry is weakening and the price of disperse dyes has dropped. The company's performance in the three quarter has dropped by 38.72% compared with the same period last year. The fourth quarter performance will continue to decline, and because of the many investment projects of the company in 2008, the performance in 2009 will be difficult to improve. According to the project planning, the performance of the industry in 2010 will not begin to grow until the new project is completed.

When Shaoxing's largest printing and dyeing enterprise, Zhejiang Jiang long Holdings Group Co., Ltd. broke its capital chain, its chairman, Tao Shoulong, "ran away". The market was worried about the price slump of Zhejiang Longsheng high cost products, and the fund company was almost "flee".

As of June 30th, 38 of the 40 funds that held shares of the company were new, while in September 30th only 3 were left.

In addition, a market analyst said, "changing production funds to repay bank loans, which means that banks are in debt, banks should be more aware of the company's business situation."

A local insider told this reporter that "now the market changes are too dangerous. Before the national day, Zhejiang Longsheng is still hoarding goods and clamoring for price increases. In the twinkling of an eye, money has been searched everywhere for" winter. "Even last year, the old dragon king, Ruan Shui long, who was relegated to the second tier, went to the bank to handle the equity mortgage loan.

According to the October 28th announcement, the largest shareholder of the company, Nguyen Shui long (14.78% of the company's total share capital), has mortgaged 15 million shares to the Minsheng Bank Hangzhou branch.