FSL cash cow diversification strategy bleak ending

FSL recently released a series of announcements, cancellation of Guangdong fozhao GuoXuan Battery Co., and plans to transfer Qinghai fozhao lithium cathode material Co., Ltd. 51% stake. Once the equity transfer deal, it means that FSL officially quit the layout of four years of the new energy field, experts in the industry, it also means that there have been "cash cow" said FSL completely abandon the diversification strategy, back lighting industry. Crashed out of the field of new energy new energy is the main cause of the continued loss of assets were stripped. According to FSL's announcement, FSL in August 2010 invested 25 million 500 thousand yuan and the companies jointly funded the establishment of Qinghai fozhao lithium cathode material limited company (hereinafter referred to as "fozhao lithium company"), accounting for 51% of the shares. However, fozhao lithium since the establishment of the company has not achieved the normal production and operation, as of the end of 2012, net profit loss of 11 million 233 thousand and 600 yuan, the first quarter of this year net profit of 606 thousand and 100 yuan loss. In order to further advance the development of new energy lithium battery business, FSL in April 2011 and Hefei, China Xuan tech power energy Limited by Share Ltd (hereinafter referred to as "Hefei GuoXuan") was established in Guangdong fozhao GuoXuan Power Battery Co. Ltd. (hereinafter referred to as "fozhao GuoXuan"), but this did not improve the new energy business situation, but let FSL added burden. It is understood that, as of the end of 2012, according to the state of Buddha Xuan accumulated losses of 13 million 855 thousand and 800 yuan. The cancellation of the two subsidiaries and equity transfer also means that FSL failed in the new energy strategy. Experts in the industry view, the failure of the layout of FSL's new energy and poor overall market close. Currently engaged in battery enterprises almost all losses, mainly because of the power battery in our country at present market size is small, mainly rely on government subsidies of the project, while local governments often prefer local enterprises. Diversification failed to return to lighting in recent years, FSL has been stripped of other companies in the business, only last year conducted a four business stripping. According to FSL's announcement shows that in June 2012, FSL to transfer 22 million 200 thousand yuan Shenzhen Liangke Venture Investment Co. 18.5% stake in the company, at the same time the liquidation cancellation of a subsidiary of Guangdong fozhao new light source technology Co. ltd.. August, announced the transfer of 256 million yuan will be held in Hefei, the country's $17.21% stake. In October, and the sale of Foshan High Bay Resort Village Landscape Ming Fu Co., all the share price to 317 million yuan. FSL to abandon diversification strategy, mainly because of the lack of diversification strategy effect is less than expected. It is understood that FSL had acquired in Hefei GuoXuan, the other party has promised Hefei GuoXuan in July 2010 to the end of June 2013 three years the average annual profit of 100 million yuan. However, Hefei National Park in 2010, the actual net profit of 22 million 670 thousand yuan in 2011, respectively, $56 million 310 thousand. In addition, the sale of the Foshan Bay Resort Village high Mingfu Landscape Co. Ltd, but also because of its long-term losses. Insiders pointed out that the diversification of FSL go blindly. The rapid rise of the LED industry so that all lighting industry companies have restructuring, while FSL is slightly slow, in 2009 began to turn to LED. While other companies to promote the development of the LED industry, FSL is deeply lithium power batteries and other areas of development. Facts have proved that FSL wants to become a new source of lithium power battery business strategy is unrealistic. The strategic adjustment and difficult to understand, stripping the lithium battery business is the first major adjustment of FSL's new chairman Pan Jiegang just after taking office. At the same time, the industry has also been seen as a pan Jie FSL lithium battery before the overall denial of this strategy. For the loss of new energy assets stripped, He Zaihua, a senior researcher at the investment adviser, it is no doubt that FSL is undergoing a new round of strategic adjustment. On the one hand can reduce the loss of the company, on the other hand, the company can focus on the lighting business, thereby reducing operating costs, to achieve the purpose of reducing efficiency. It is noteworthy that, pan Jie is not a veteran of FSL characters, but an airborne, had worked in the General Company. This has also raised some concerns in the industry, He Zaihua pointed out that the lack of operational experience in the domestic capital market, pan, there may be some disadvantages in the local strategy. In addition, as an emerging industry, LED lighting is bound to replace the traditional energy-saving lamps into the mainstream market. The 2013 Guangzhou International Lighting Exhibition this year, there is the view that the next 5-8 years, LED industry will usher in a period of growth, while overcapacity will always be accompanied by over 7000 LED, domestic enterprises will also be detonated LED industry fight. In the industry view, this background, FSL with a lack of domestic capital market operation experience, and adjust the radical coach of corporate strategy, it is difficult for FSL.