Lianyu Co., Ltd. increased its capital of 194 million to Sun Company to implement smart lighting projects in Vietnam

On October 23, Lianyu Co., Ltd. issued a series of announcements, announcing that it would use approximately 193.56 million yuan of raised funds to increase capital through its wholly-owned subsidiary Hong Kong Lianyu Lighting Co., Ltd. (hereinafter referred to as "Hong Kong Lianyu") to its wholly-owned subsidiary company Lianyu Technology (Vietnam) Co., Ltd. (hereinafter referred to as "Lianyu Technology") to promote the construction of the company's smart lighting production base in Vietnam.

According to the announcement, the total amount of funds raised by Lianyu Co., Ltd. from the initial public offering of shares is 754 million yuan. The company plans to use the remaining 182.439 million yuan of funds raised from the original investment project "Smart Lighting Production Headquarters Base Project" and the super-raised funds of 11.1209 million yuan to build a new "Smart Lighting Vietnam Production Base Construction Project" in Vietnam, with a total investment of 236.4555 million yuan.

The implementation entity of the newly raised investment project "Smart Lighting Vietnam Production Base Construction Project" is Lianyu Technology, which has not yet completed its establishment. After the capital increase, the registered capital of Lianyu Technology will increase from 40 million yuan to 233.5605 million yuan. Lianyu Shares will hold 100% of its equity before and after the capital increase.

According to TrendForce's "2024 Global LED Lighting Market Analysis-2H24" analysis, the LED general lighting industry is experiencing "consumption downgrade". The current situation of falling volume and price not only affects the growth expectations of the LED general lighting industry, but also forces players in the traditional lighting industry to re-examine their market strategies and focus on segmented application areas with greater growth potential. In this market environment, Lianyu Co., Ltd. has laid out smart lighting segmentation tracks, or actively responded to market changes.

Image source: Paixin.com genuine photo gallery

Lianyu Shares pointed out that the company’s current main sales markets are overseas, especially the North American market. By building a new production base in Vietnam, we can effectively ensure the supply needs of major overseas customers, continue to expand overseas business, and reduce international trade risks. At the same time, Vietnam's preferential tax policies help reduce the cost of companies' export products and improve the international competitiveness of their products.

Lianyu Shares said that the agglomeration effect of related industries in Southeast Asia is gradually emerging, with abundant labor resources and advantages in labor costs. The new Vietnam production base will utilize local industrial supply chains and human resources to further optimize the company's cost structure and enhance profitability. Therefore, the company plans to expand production capacity and build a production base in Vietnam.

Since its establishment, Lianyu Co., Ltd. has been focusing on the R&D, production and manufacturing of LED outdoor and industrial lighting products. Judging from revenue data, the company's sales revenue from 2021 to 2023 were 1.225 billion yuan, 1.09 billion yuan, and 1.382 billion yuan respectively, showing a stable growth trend.

Lianyu Co., Ltd. stated that as the demand for replacement of LED lighting products in overseas markets accelerates, customer order demand continues to grow, and the market demand for the company's LED lighting products maintains rapid growth. The company continues to increase market expansion efforts and obtain orders from new customers. Since the products are mainly sold overseas, the current overseas production capacity cannot meet the demand of customer orders. The company plans to expand production capacity overseas to further promote the development of LED lighting business.

Therefore, the project plans to build a new factory in Vietnam, introduce advanced production equipment, build automated production lines, and expand the company's production capacity. The implementation of the project will help break through the production capacity bottlenecks in overseas regions and meet the growing market demand.