The hottest Zhang Yin's wealth on paper

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Zhang Yin's paper wealth

almost overnight, the name Zhang Yin became popular all over the country. Hurun, the "good Samaritan", pushed the 49 year old woman to the top of the wealth list. Regardless of whether the Hurun ranking is scientific or not, through the analysis of Nine Dragons Paper, which is headed by the female "richest man", we find that the success of its vertically integrated business model is real

on October 11, 2006, Hurun, the "good Samaritan", launched his 100 rich list as scheduled. The highly entertaining Hurun pushed a 49 year old woman, Zhang Yin, to the top of the list this year, and achieved a lot of surprise as he expected. The "careless" Hurun didn't calculate Sister Zhang's worth according to the average price of Nine Dragons Paper for half a year - 6.49 yuan. That would only rank third, and the sensation effect would be much worse. No matter the first or the third place, Nine Dragons Paper's assets and performance are real: the annual output of 10 production lines reaches 3.3 million tons, the supporting power plants, water plants, wharves, fleets, warehouses are all available, and the fixed assets reach 8.625 billion yuan; As of the end of June 2006, the sales and net profit of the previous fiscal year reached 7.9 billion yuan and 1.375 billion yuan respectively

through the analysis of this paper giant, we can find that the business model of vertical integration is the key to nine dragons' success

"waste paper is forest"

in 1985, 27 year old Zhang Yin gave up her accounting job in a well paid joint venture in Shenzhen and took 30000 yuan to Hong Kong alone

previously, he was entrusted by a Chinese paper mill to purchase waste paper in Hong Kong. Zhang Yin began to get involved in the field of converting straw pulp papermaking to environmentally friendly papermaking. She soon learned about the shortage of paper in the mainland and the huge market potential. China is relatively poor in forest resources, especially the construction of fast-growing forests for papermaking is seriously lagging behind, so most of the raw materials of high-grade paper need imported waste paper and wood pulp (domestic waste paper collection system is not perfect, and the level is not enough). Waste paper in developed countries and regions has become an important way to solve the bottleneck of papermaking raw materials in China. This low threshold business, known as "junk collection", has attracted many merchants, and Hong Kong has become their most important distribution center. Therefore, Zhang Yin started a waste paper recycling business in Hong Kong. Recalling those years, Zhang Yin said, "although people with a low level of education are engaged in waste paper recycling in Hong Kong, they pay special attention to faithfulness and fall in love with me. In addition, I adhere to the quality of waste paper and just catch up with the booming period of Hong Kong's economy, so I completed part of the capital accumulation within six years." There Zhang Yin met his future husband and business partner Liu Mingzhong, a Taiwanese compatriot

in February 1990, Zhang Yin and his wife began to expand waste paper recycling business in the United States and established Zhongnan holding company. There is not only rich waste paper resources, but also the waste paper recycling system is extremely efficient and scientific. In addition, careful Zhang Yin also took advantage of the opportunity that others did not find - a large number of containers carrying export goods returned to China empty, and Zhang Yin transported American waste paper to China with very low freight. In the past 10 years, central and southern China has successively built seven packaging plants (packaging the waste paper received) and transportation enterprises in the United States

in 2002, Zhongnan jumped to be the company with the largest amount of container exports in the United States. Today, Zhongnan is the largest supplier of paper raw materials in Europe and the United States, with an annual shipment of more than 5million tons. These goods need to be transported in 200000 12 foot standard containers! According to the report of the American forest and Paper Association, the United States consumes 47million tons of paper every year, nearly 75% of which will be recycled. According to the statistics of China Customs, the import of waste paper in 2005 increased by 33.6% compared with that in 2004, reaching 17.04 million tons (the sharp increase in China's import volume also directly led to the rise in the international price of waste paper). In this way, 1/7 of the renewable waste paper in the United States is exported by central and southern China every year, while more than 1/4 of China's recycled paper raw materials are imported by central and southern China

in this way, Zhang Yin and his wife created a business of daily gold with their unique business model, and also planted a vast "forest" for China's paper industry

vertical integration

since the raw materials are in hand, why not make paper by yourself? In 1987, after less than two years in Hong Kong, Zhang Yin began to look for paper mills as partners in the mainland, and the joint venture with Yingkou paper mill in Liaoning Province was soon successful. Later, she accumulated a lot of experience in joint ventures with Wuhan Dongfeng paper mill and Hebei Tangshan paper mill. In 1988, Zhang Yin established a wholly-owned paper mill in Dongguan - Dongguan Zhongnan paper industry to produce household paper

in 1996, Zhang Yin decisively invested US $110million in Dongguan to establish nine dragons paper. In July, 1998, the first production line was completed and put into operation, which can produce 200000 tons of high-grade Kraft linerboard every year. In June, 2000 and may, 2002, Zhang Yin invested heavily to install two production lines in Dongguan base. So far, Nine Dragons Paper has established its position as the leading enterprise of China's packaging paperboard with three production lines and a production capacity of one million tons. Since then, nine dragons' pace has not slowed down at all, and the new production lines of Dongguan base are still on the ground one by one; At the same time, it also moved north to Taicang, Jiangsu, and quickly formed a capacity of 950000 tons, almost rebuilding a nine dragons. At the beginning of 2005, the production capacity reached 2.35 million tons. At the end of the year, the production capacity increased by nearly one million tons to 3.3 million tons, accounting for 17% of the Chinese market. Nine Dragons Paper has surpassed Chenming paper to become the largest papermaking giant in China, the second largest in Asia and the eighth largest in the world. The vigorous development of China's economy, especially the products produced as the "world factory" need high-quality packaging. Nine Dragons Paper products are in short supply and are adopted by well-known enterprises such as Coca Cola, Nike, Sony, Haier, TCL, etc

Nine Dragons Paper has built 350000 square meters of workshops on 1353 mu of land in Mayong Town, Dongguan City, and the land cost is only 20000 per mu; The purchase price of 3839 mu of land obtained by Jiangsu Taicang is between 80000 and 86000 yuan; The unit price of 739 mu of land in Zhalantun, Inner Mongolia is 67000 yuan... At the end of 2005, the property (plant, land, buildings, etc.) held by nine dragons in the mainland was valued at 2.461 billion yuan

central and southern China buys waste paper in the United States at a low price, transports it to China at a low freight, and then uses the advantages of land, energy and manpower in the mainland to produce high-grade paper products in short supply at a low cost. The industrial chain built by Zhang Yin and his wife is under their own control from the beginning. They all have cost advantages and are profitable. At the end of the industrial chain, high-end products in short supply are exported... Successful vertical integration and optimization of the industrial chain are the secrets of the birth of China's "richest man"

In 1985, Porter put forward the concept of "value chain", which overturned the traditional "barrel theory". The "barrel theory" says that enterprises should make up for their shortcomings in order to "leak free", so as to obtain the maximum value. The value chain theory guides enterprises to abandon the "short board", break the barrel, and lengthen the "long board" to form a competitive weapon. According to Porter's theory, enterprises should strengthen the links that truly create value in business processes so that they will not break and have comparative advantages in the process of deformation. The so-called "Refocusing" is to strictly control the links that produce core competence in business activities within the enterprise, and outsource some non core strategic activities, so as to make full use of domestic and international markets to reduce costs and improve competitiveness and profitability. In recent years, the strategy of Nine Dragons Paper has demonstrated a typical refocusing strategy for us

the first is to expand production capacity and improve the quantity and quality of products. In October, 2003, the No. 4 production line with an annual output of 450000 tons of coated white cardboard was put into operation in Dongguan, creating the largest single unit output of similar products in the world, and taking the first step of Nine Dragons Paper Industry from a single kraft cardboard to a diversified variety. A year later, lines 6 and 7, which produce high-strength corrugated paper cores, were successfully put into production in Dongguan, further enriching the product line of Nine Dragons Paper. In December, 2005, the completion of nine or twelve high-strength corrugated core production lines made the total capacity of the group reach 3.3 million tons. In 2007, Dongguan's line 11 with an annual output of 500000 tons of coated white cardboard, line 12 with an annual output of 400000 tons of kraft cardboard and Taicang's production line with an annual output of 400000 tons of high-strength corrugated paper will be put into operation successively. According to the plan, the total capacity of Nine Dragons Paper will further increase to 9million tons! In order to enrich the supply channels of raw materials, nine dragons also went north to Inner Mongolia and set up the "Nine Dragons Xing'an" with an annual output of 100000 tons of high-quality wood pulp in 2004

according to the pre German reprap of the paper industry association in 2005, which showed how to deal with liquid materials in lam3d printers, the gap of vulnerable parts of high-strength tiles in China 5: sheet metal corrugated paper, kraft linerboard and coated white linerboard is 1.6 million respectively, and its goal is to remove the surface damage tons, 1.2 million tons and 600000 tons produced by rough polishing. With thousands of acres of land, 10 billion level investment, advanced production lines and product layout for market gaps, Nine Dragons Paper has taken the lead in recruiting and forming a "super long" board that rivals can't catch up with

the second is self built infrastructure. Paper mills are large users of electricity, water and transportation, which not only pose great pressure on local public infrastructure, but also directly restrict the expansion of production capacity. The more developed the economy of our country is, the more tense the power is, and the power rationing will occur in a large area every year. With the combined operation of 210 MW thermoelectric units in May, 2005, the total installed capacity of Nine Dragons Paper Dongguan base reached 351 MW, equivalent to a medium-sized power plant. The installed capacity of Nine Dragons' thermal power plant in Taicang base also reached 240 MW. It not only ensures the sufficient power supply of the enterprise, but also relieves the local power tension. The paper mill is also a large user of water. Nine Dragons Paper has two 250000 ton upstream reservoirs, a seawater desalination plant with a daily treatment capacity of 100000 tons and perfect sewage recycling facilities to ensure production water. Nine Dragons Paper also has a 500000 ton raw material warehouse, an 80000 ton finished product warehouse and a 10000 ton semi-finished product warehouse. In addition, it also has a fleet of 350 heavy trucks and a cargo terminal in Taicang port that can connect 50000 ton cargo ships...

in a sense, Nine Dragons Paper, with an asset scale of 10 billion, is diversified, but all its resources and capacity formed by these inputs are completely centered on the core business of papermaking

landing in the capital market

on March 3, 2006, Nine Dragons Paper () was listed on the main board of Hong Kong. The initial public offering plans to sell 1billion shares at an issue price of HK $3.4 and raise HK $3.4 billion, which is the only "large cap stock" in private enterprise IPO cases. On the day of listing, the closing price was HK $4.75, up 39.7% from the offer price, with a transaction of HK $2.425 billion, making it one of the top 20 most active Hong Kong stocks on the day. The original plan was to sell only 100million shares of the 1billion new shares in Hong Kong, but the market response was extremely enthusiastic. In Hong Kong alone, 52billion shares were applied for share purchase, and the capital was frozen for about 177billion Hong Kong dollars. In order to meet the enthusiastic demand of Hong Kong stock market for Nine Dragons Paper, the number of shares sold in Hong Kong has been increased to 500million. At the same time, the Underwriters exercised the over allotment right and issued 150million additional shares as agreed in advance, bringing the total amount of IPO funds raised by Nine Dragons Paper to HK $3.91 billion. It is also worth mentioning that Henderson Li Zhaoji, new world Zheng Yutong and Kerry construction Guo Henian jointly invested HK $468million in private to subscribe for 137million new shares, accounting for 3.3% of the total share capital. Over the past few months, the share price has been rising steadily, especially the profit of fiscal year 2006 rose by 350% to HK $1.375 billion

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