The prosperity of the civil explosion industry has rebounded

Since the beginning of this year, although affected by unfavorable factors such as the conflict between Russia and Ukraine, the US interest rate hike and the frequent occurrence of domestic epidemics, the overall prosperity of China's civil explosion industry has rebounded
under the growth of infrastructure investment and the energy extraction industry.

According to data from the China Blasting Equipment Industry Association, in January ~ October, the cumulative total output value of China's civil explosive enterprises was 31.
47 billion yuan, a year-on-year increase of 16.
3%; The cumulative production and sales of explosives were 3.
59 million tons and 3.
582 million tons, respectively, an increase of 1.
3% and 1.
4%
year-on-year.
Among them, the cumulative output of electronic detonators was 240 million rounds, a year-on-year increase of 88.
8%.

In this context, listed companies in the civil explosion sector have also achieved good results
.
There are 12 companies in Shanghai, including Poly United, Nanling Minbao, Yahua Group, Jiangnan Chemical, Cathay Group, Kailong Shares, Huhua Shares, Xuefeng Technology, and Tongde Chemical, with a total main revenue of 38.
5 billion yuan in the first three quarters, a quarter-on-quarter increase of 69.
21%; The total net profit was 5.
737 billion yuan, a quarter-on-quarter increase of 40%.

In the first three quarters, only 3 companies, Poly United, Jiangnan Chemical and Nanling Minbao, lost money
.

Industry insiders believe that the civil explosion industry has achieved good results, and the reason is that it is driven by the growth of infrastructure investment
.
According to data released by the National Bureau of Statistics, in January ~ August this year, China's infrastructure investment increased by 8.
3% year-on-year, and the growth rate rebounded
for four consecutive months.
Second, energy extraction has been re-emphasized
.
Affected by the global energy shortage and macro level, this year, the State Mine Safety Administration reviewed and approved 147 advanced capacity coal mines, increasing production capacity by 180 million tons
.
The continuous rise in coal prices has led to an increase in demand for civil explosive products, which has boosted the civil explosive industry into an upward channel
.

With the rise of the industry prosperity, some enterprises have also accelerated the layout
of civil explosion projects recently.
On October 22, Huhua issued an announcement that the company held a groundbreaking ceremony
for digital electronic detonator legs and chip high-tech projects.
With a total investment of 125 million yuan, the project will build 7 digital electronic detonator pin strip production lines with an annual output of 10 million hairs and 1 chip packaging production line with an annual output of 60 million hairs
.
On October 18, Nanjing Polytechnic Technology Chemical Co.
, Ltd.
, a subsidiary of Jiangnan Chemical, passed the acceptance of trial production safety conditions with an annual output of 10 million rounds of digital electronic detonators
.

In addition, the relevant policies, regulations and standards on the civil explosion industry have been intensively introduced
recently.
On November 7, the Department of Work Safety of the Ministry of Industry and Information Technology issued a notice, WJ/T 9051-2022 "Coal dust for permitted explosives in coal mines - Test method for combustible safety degree", WJ/T 9100-2022 "Guidelines for the Construction of Hidden Dangers of Production Safety Accidents in Civil Explosives Production and Sales Enterprises", WJ/T The 9101-2022 "Guidelines for the Construction of a Graded Safety Risk Management and Control System for Civil Explosives Production and Sales Enterprises" has been approved and released and will be implemented
from April 1, 2023.

On October 31, the Ministry of Industry and Information Technology issued the "Opinions on Promoting the High-quality Development of the Civil Explosion Industry", which proposed that by 2022, the industry will eliminate a number of backward technologies, close a number of high-risk production lines, cultivate a number of well-known brands, and build a number of demonstration enterprises
.
Cultivate 3~5 leading enterprises with certain industry driving force and international competitiveness, form 8~10 backbone enterprises with outstanding leading role in science and technology and strong integrated service capabilities, and the GDP of the top 15 production enterprises accounts for more than 60%
of the whole industry.

"Some listed companies will accelerate the pace of
mergers and acquisitions.
Through cost-effective absorption and mergers and acquisitions, leading enterprises in the civil explosion industry can not only expand production capacity and increase market share, but also open up the local market more directly and expand their business scope
.
An Guangyong, an expert from the Credit Management Committee of the All-Union M&A Association, said
.

Everbright Securities Research Report believes that with the blessing of policies, the scale of the detonator market will expand by more than
6 times.

Zhongtai Securities Research Report is also firmly optimistic about the civil explosion industry
.
On the one hand, the permeability of electronic detonators returns to the ascending channel
.
With the supply of chip modules and the promotion of coal mine allowable detonator certification, the penetration rate of electronic detonators in October has reached 84.
44%, an increase of 25.
7 percentage points
from September.
With the continuous promotion of the "14th Five-Year Plan" for the safety development of the civil explosives industry, the penetration rate of electronic detonators is expected to continue to rise
.
On the other hand, the industry will usher in a boom
in production and sales in November.
According to the data of the National Bureau of Statistics, the monthly capital expenditure of China's mining industry this year showed a good growth trend, the cumulative growth rate of non-metal mining and dressing industry in September was 18.
6% year-on-year, the cumulative growth rate of non-ferrous metal mining and dressing industry was 17.
8%, and the cumulative year-on-year growth rate of ferrous metal mining and dressing industry was 38.
9%, coupled with the fourth quarter is the traditional demand season of civil explosion industry, so the market in November is full of expectations
.