Beijing%20Beida%20Jade%20Bird%20Universal - PowerPoint PPT Presentation

Title: Beijing%20Beida%20Jade%20Bird%20Universal


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• Beijing Beida Jade Bird Universal
• Sci-Tech Company Limited

Strategic Development
May 2002
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Content

• Part (I) About the Company
• Part (II) Strategic Investment in SMIC
• Part (III) Prospects Outlook of Semiconductor
• Industry
• Part (IV) Proposed Placing of New H Shares

3
Part (I)About the Company
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Company Background

• Incorporated as a joint stock limited company
• Registered capital RMB 96,400,000

29 Mar 2000

• The first H Shares Listed on the Growth
  Enterprise Market of the Stock Exchange of Hong
  Kong
• Stock Code 8095
• Capital raised Approx. HK300 million

27 Jul 2000
18 Dec 2000

• Company subdivided each of the Promoters shares
  and H shares into ten shares

5
Shareholders Structure
Employees of Jade Bird Group the Company
Strategic Investors from Hong Kong

Peking University
93.37
6.63




Dynamic Win
Jade Bird Group
Public (H Shares)
Strategic Investors from HK Singapore
22.82
27.39
32.16
17.63
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Company Structure (1)
The Company
100
75
51
Hebei Beida Jade Bird Universal Fire Alarm
Device Co Ltd
Beijing Jade Bird Hao Di Electric System Co Ltd
Beida Jade Bird Universal Sci-Tech (Cayman)
Development Co Ltd
100
Beida Jade Bird Universal Sci-Tech (Cayman)
Investment Co Ltd
5.29
SMIC
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Company Structure (2)

• JBU (Cayman) Development engaged in the sales
  of computer products
• JBU (Cayman) Investment holding the investment
  in SMIC
• SMIC an IC foundry factory located in Shanghai
  Pudong
• Hebei JBU Fire Alarm Device engaged in the
  manufacture and sales of fire alarm devices
• Jade Bird Hao Di engaged in the manufacture and
  sales of electric meter remote reading system

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Principal Activities

• One of the leading software developers and
  integrated circuit designers in the PRC
• Engaged in the design, manufacture, marketing,
  distribution and sale of proprietary embedded
  products including
• Application Specific Integrated Circuit (ASIC)
• Network Security Products
• GPS Application System
• Smart Card Application System
• Wireless Fire Alarm System (WFAS)

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Awards Qualifications (1)
10
Awards Qualifications (2)
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Awards Qualifications (3)
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Major Products (1)

• ASIC
• Develop embedded microprocessor and specific
  integrated circuits
• Provide ASIC technologies and customized
  engineering design, strives to improve the system
  with optimal performance, smaller size and lower
  cost
• Design and develop ASIC synthesized with
  cryptographic logic (Security ICs) for
  commercial information security systems

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Major Products (2)

• Network Security Products
• Security gateway, firewall and network monitor
  systems are applied in government branches,
  financial institutions, large enterprises and the
  army
• Begin mass production of SJY01- A, SZD02 and
  SJY04 encryption cards
• Emphasize security services such as risk
  evaluation, system optimization, security alarm
  and consulting
• Strengthen cooperation with SYMANTEC and other
  famous information security providers

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Major Products (3)

• GPS Application System
• Box unit installed in moving or static target
  sending longitude and latitude information via
  wireless communication network, thus allowing
  remote monitoring facility and control center to
  keep track of target
• Apply JB-230M GPS system in fleet management
  monitoring, dispatch and theft alarm of all kinds
  of vehicles
• Strengthen RD on emerging applications such as
  logistics distribution and navigation
• Strengthen ties with regional governments, and
  strive to establish markets in Beijing,
  Guangdong, Sichuan and South-eastern part of the
  PRC

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Major Products (4)

• Smart Card Application System
• Provide contact and contactless smart cards
• Products cover intelligence household management
  system, logistics management system, POS and
  access control system
• Major customers include universities, hotels,
  financial institutions and large enterprises

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Major Products (5)

• WFAS
• Accurate fire detecting and fire alarm functions
• More reliable, economic and versatile
• Apply in Haikou Fire Alarm Control Center,
  Zhongnanhai, Yuquan Mountain, the Summer Palace
  and other projects
• Manufacture fire alarm sensors and controllers
  through subsidiary Hebei Beida Jade Bird
  Universal Fire Alarm Devices Limited
• Strengthen support for upstream RD and flexible
  applications of wire and wireless fire alarm
  solutions

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Major Clients
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Financial Highlights (1)
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Financial Highlights (2)
RMB000
20
Part (II) Strategic Investment in SMIC
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Reasons for Benefits of Investing in SMIC

• Strengthen and enhance the Companys technology
  in the design and development of ICs
• Enable the Company to obtain more market
  intelligence about ICs manufacturing technology,
  which in turn benefit our design of ICs which are
  key components of the Companys products
• Ensure stable supply of ICs at competitive price
  by subcontracting ICs manufacture to SMIC
• Enable the Company to receive other support from
  SMIC in technologies and techniques enhancement

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JBUs Involvement in the Management of SMIC

• The Company has an active role in setting up and
  running of SMIC
• As one of the promoters of SMIC, the Company has
  participated in SMICs feasibility study and
  taken up an important role in its liaison with
  PRC government authorities
• Two of the Companys directors have been actively
  participating in the management and operation of
  SMIC

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JBUs Investment Highlights

• Investment vehicle Beida Jade Bird Universal
  (Cayman) Investment Company Limited, wholly owned
  subsidiary
• Subscribe for 54,000,540 SMIC Preference Shares
  at US1.1111 per share
• Subscribe for 54,000,540 SMIC Series A-1
  Preference Shares at US0.00001 per share
• Total investment amounting to US60 million
• Hold approximately 5.29 of the total issued
  voting share capital of SMIC

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Pro Forma Financials after the Investment
(Based on the actual financials of year 2001)
Upon Completion of Investment and Share Placing

Current
RMB000
124,617
124,617
Turnover
39,840
-
Income Dividend
77,350
37,510
Profit attributable to shareholders
6.7
3.9
Profit per share - (RMB cents)
787,764
831,372
Total assets
-
390,000
Bank loans
787,764
403,997
Shareholders equity
Assumed the preference shares dividend rate
at 8 Based on issuing the additional
192,800,000 H shares and the current market price
of HK1.5 per share (total placing proceeds
amounting to HK289 million or US37 million)
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SMICs Competitive Advantages (1)

• Strong base of strategic partners and investors
• Enormous market potentials
• Lower costs
• Building/facilities
• Workforce/operations
• Supplies/material
• Strong government support
• Experienced management

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SMICs Competitive Advantages (2)

• Import tax (tariff) exemptions
• Equipment
• Raw Material
• Value added tax (VAT) rebates
• 17 Vs lt5
• Corporate tax discounts
• First profitable year 5 exempt-5 halves
• Accelerated depreciation (tax purposes)
• Preferential treatment for Fabless design houses
• Same treatment as software industry (3 VAT)

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SMICs Initial Financing

• Registered Capital US1 billion
• First phase investment amount US 1.4 billion
• Major investors include

• Strategic Partners
• Jade Bird Universal
• Shanghai Industrial Holdings

• Institutional Investors
• Goldman Sachs
• HQ Asia Pacific
• Walden International
• Vertex Management

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SMICs Capability

• Low power static random access memory (SRAM)
  technology transfer from Toshiba
• 0.18-micron baseline logic process technology
  transfer and patent license rights from
  Chartered, one of the world's top three silicon
  foundries
• Manufacture 0.22um and 0.18um FCRAMTM (Fast Cycle
  RAM) Products for Fujitsu Limited
• Conclude a non-exclusive alliance with ChipPAC,
  Inc. (Nasdaq CHPC) for end-to-end solutions from
  wafer probe to packaging and test and final
  distribution in China and global market
• Establish partnership in the area of advanced
  semiconductor process technology with Europe's
  leading independent RD centre for
  microelectronics, IMEC

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SMICs Development Plan
Equipment installation begin
Pilot production begin
Half capacity reaches 25,000 wafers/month
Combined production to 85,000 wafers/month
Photo mask shop cleanroom completed
2004
Jan
1H
Construction ground breaking
Initial products/ processes qualified
Volume production commence
Possible 2nd phrase financing (2H 2003)
SMIC has 1-2 year leads over its competitors in
terms of entering into the China market
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SMICs Employees
By Education
By Region
By Experience
Total 1032 employees as at August 27, 2001
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Part (III)Prospects Outlook of Semiconductor
Industry
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Supply Demand of ICs in China
SourceCCID
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Semiconductor Market Worldwide and China
SourceDataquest
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Existing Suppliers in China
Grace, Belling, Hua Xia and others are either
under the construction or at the planning stage
35
Existing Fab Technology in China
Unit Inch
Unit Micron
Year 2000
Source Computer World, CLSA Emerging Markets
36
Market Outlook (1)
Expected Growth

• Rapid expansion of domestic market
• Current market US15 Billion (8 global
  market)
• 30.8 Growth p.a. 1998-2000

USBillion
Source Gartner Dataquest
37
Market Outlook (2)
Data Processing Semiconductor

• Growth drivers
• Internet continues to drive growth
• Increase investment from Taiwanese motherboard/
  notebook/ PC manufacturers
• Global OEMs are establishing production in China
• Local consumer electronics producers are
  venturing this sector

Source Gartner Dataquest
38
Market Outlook (3)
Communications Semiconductor

• Growth drivers
• Governments effort to enhance the information
  and networking system
• Strong foreign direct investment inflow in
  electronics and communications equipment sector
• Increase percentage of low to mid end
  communications production

Source Gartner Dataquest
39
Market Outlook (4)
Consumer Semiconductor

• Growth drivers
• Robust GDP growth
• Critical mass of middle class consumers

Source Gartner Dataquest
40
Market Outlook (5)
PC Market

• Only 1.9 PC penetration in 2000
• 48 growth Y/Y in Q1 2001
• Projected 26 CAGR 2001-2003

• Data processing electronics 43 p.a. growth
  1997-2000

Source IDC, JP Morgan estimates
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Market Outlook (6)
Mobile Phone Subscribers
No. of subscribers (in million) (Accumulative)
Source IDC, JP Morgan estimates
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Part (IV)Proposed Placing of NewH Shares
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Proposed Transaction

• Issuer
• Shares Offer
• Size of Offer
• Use of Proceeds
• Closing Date

• Beijing Beida Jade Bird Universal Sci-Tech Co
  Ltd
• (Stock code 8095.hk)
• 192,800,000 ordinary shares (H Shares)
• US 37 million (estimated)
• Repayment of bank loan used for investment in
• SMIC
• June 2002

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Special Capital Price

• Record High HK2.925 per H share
• 31 May 2001
• Record Low HK1.1 per H share (Placing Price)
• 27 July 2000 (IPO)

RMB 0.1
Nominal Value
700,000,000
Number of Promoters Shares
264,000,000
Number of H Shares
964,000,000
Total Number of Issued Shares
RMB 96,400,000
Total Issued Share Capital
Current Market Capitalization
HK1,426,720,000
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Stock Performance
Stock Price and Volume Performance (IPO Date to
Present)
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• Beijing Beida Jade Bird Universal
• Sci-Tech Company Limited

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