Introduction to Hongcai Investment Group of Guizhou
Established in June 2004 with a registered capital of 170 million yuan, Hongcai Investment Group of Guizhou (referred to as "Hongcai Group" below) is an enterprise solely funded by the state and established with the approval of the People's Government of Panxian County. It is the recipient of investment and financing from the county government, and a legal entity authorized to engage in construction projects such as state-owned assets and municipal infrastructure. In September 2014, the company was renamed "Hongcai Investment Group of Guizhou". Always oriented towards the market, Hongcai Group has adhered to the philosophy of "respecting talent, pursuing excellence, and reaping returns with contributions". It constantly expands its business scope, breaking through development bottlenecks and exceeding its prior accomplishments.
Since its establishment, the company has fully integrated local resources, made use of its own advantages, and formed a closed loop of business and financing for the industries of its subsidiaries by integrating the resources of each segment. This has become a "driving force" for its transformation and development into a comprehensive group at an accelerated pace.
At present the company has a workforce of 178 employees, total assets exceeding 41 billion yuan with a debt ratio of 39%; an accumulated financing and lending amount of 19 billion yuan, with paid-in investment of 15 billion yuan, and total investment of 35 billion yuan in 150 construction projects, of which completed investment exceeds 10 billion yuan. It owns 11 wholly-owned subsidiaries, 6 second-tier subsidiaries and 4 share-controlled subsidiaries. Its business scope covers road construction, land consolidation, primary land development, real estate development, municipal infrastructure construction, comfortable housing projects (shantytown reconstruction, public rental housing), automobile service, asset management, non-coal mining and storage; tourism culture, education and social poverty alleviation and development.
I. Municipal Infrastructure
In 2016 Hongcai Group made a total investment of 14.7 billion yuan in 45 urban infrastructure construction projects including the road network of a wetland park and the Shengjingsan Road of Liuguan. Of these 16 were newly built projects with a total investment of 4.256 billion yuan; 29 were expansion projects with a total investment of 10.444 billion yuan. In 2017 it plans to complete investment of 2.2 billion yuan in municipal infrastructure projects. The construction of these projects will effectively improve the infrastructure of the Hongguo downtown area, Liuguan neighborhood, Zhuhai Town and Dashan Town, as well as enhance the image of the county.
II. Comfortable Housing Construction
In 2014, Hongcai Group was designated by the People's Government of Panxian County as the owner of the shantytown reconstruction projects of the county. It focused on promoting shantytown reconstruction by means of applying for subsidy funds from higher level authorities; loans from the China Development Bank and the introduction of social capital and investment. From 2013 to 2017 the shantytown reconstruction has encompassed a total of 126,000 households with total investment of around 19 billion yuan. Projects launched from 2013 to 2016 encompassed 94,185 households, and in 2015, 3,158 public rental homes were built with a floor area of nearly 190,000 ㎡ and total investment of 577 million yuan. Construction currently adopts the PPP+EPC model, and by planning and implementing a series of comfortable housing projects will greatly improve the living conditions of relocated households and low-income people, as well as achieve more scientific urban planning and development.
III. Real Estate Development
Based on the land resources of the company, it has firmly promoted the linked primary and secondary development of land and successively launched real estate development projects such as Hongcai Investment Building and Commercial Street on Hongsha Road, following a model of "development following maturity.” At present the total floor area of projects under construction exceeds 1.20 million ㎡. The commencement and completion of these projects will help realize a strong closed-loop of business and financing for the company.
IV. Education Industry
In 2016, the People's Government of Panxian County listed the education plan of "4321" in the "ten major issues for the livelihood of the people" (four kindergartens, three primary schools, two junior high schools and one senior high school). Hongcai Group is responsible for the construction of five schools (two kindergartens, one primary school, one junior high school and one senior high school), of which two kindergartens have been opened. The company is currently busy negotiating with renowned education operators at home and abroad, and will introduce a first-class school management team and system. The implementation of the aforementioned school projects will achieve a substantial improvement to the fundamental education level of Panxian County and substantially ease its shortage of quality education resources..
V. Automobile Industry
Based on government vehicle reform policies, the company has established an auto service center and cooperated with Beijing Hyundai to open a Beijing Hyundai 4S Store which is the first of its kind in Panxian County. The completion of the store has optimized the auto service industry of the county and surrounding areas, as well as greatly boosted the auto service quality of the county.
VI. Cultural Experience Industry
The Panzhou outward bound Base developed by the Group’s cultural media company is the largest outdoor experience base in the southwest of China, and used the opportunity presented by the creation of a Comprehensive Training Base for the militia of Panxian County for construction and operation based on the model of "Investment by Enterprise+ Usage by the Government+ Participation by Cooperatives.” It has been completed, entered operation and established an "alliance of strong players" by introducing the management system and professional team of Shanghai Action Business Management Co., Ltd. - a listed company in the outdoor experience industry.
VII. Social Poverty Alleviation and Development
Firstly, at the end of 2015 Hongcai Group launched the social poverty alleviation and industrial development project for a region covering Liuguan, Dashan and Zhuhai, and adopted the pairing support model of "211" (one platform and one financial institution cooperate to aid and support one town with investment of not less than 100 million yuan each year. The group cooperates with the Panxian branch of ICBC to aid and support Liuguan neighborhood, Dashan Town and Zhuhai Town). At present it has completed an investment of approximately 400 million yuan in Liuguan and investment of around 300 million yuan in the Dashan-Zhuhai area. The company will introduce a professional team to guide the professional operation and management of the Dadong Bamboo Sea Scenic Area. It will build the scenic area in accordance with the standard for 5A tourist attractions and develop it with a combination of other industries to thoroughly eliminate local "poverty" factors. Secondly, Hongcai Group takes the lead in the development of the Roxburgh Rose and herbal medicine industries of the county. Hongcai Group engages in deep cooperation with the towns and cooperatives of peasants to build a demonstrative base for the Roxburgh Rose and herbal medicine industries and develop the industrial chain of Roxburgh Rose processing, tourism and health products. It will lead the peasants in raising income and becoming rich by means of Roxburgh Roses, which have been dubbed the "Queen of Vitamin C". Thirdly, Hongcai Group takes the lead in carrying out work on the second battlefield for the county's poverty alleviation efforts - Machang district, which covers 7 towns and neighborhoods in total. This work includes general planning, scheme compilation, project applications and fund-raising for projects.
During the "13th Five-Year Period", Hongcai Investment Group of Guizhou will align itself with supply side structural reform under new economic conditions, and build platforms for entrepreneurship and innovation while playing the role of a booster and incubator for the development of the real economy. It will accelerate the asset securitization process by means of capitalized operation, and encourage its own advantageous industrial entities to "defeat rivals" or go public, promoting the social value of state-owned assets and continuing to grow towards the goal of "becoming stronger and tougher, improving the quality of assets, and making employees happy".