Dongxin Co., Ltd.: Investors question development pace; the Secretary of the Board responds with development strategy and funding plan

Investor Q&A:

To the Secretary of the Board, hello! Recently, peer company Biwei Storage has signed a major purchase contract worth $1.5 billion for storage wafers, actively expanding its supply chain and capacity. In contrast, the company’s asset-liability ratio is only about 5%, and it has ample cash reserves. However, in the long term, there has been no sign of major investments, capacity expansion, or strategic deployment actions that match the industry cycle. This clearly lags behind the fast-paced development of the industry.

My question: What is the company’s assessment of the current industry opportunities? With such an extremely low asset-liability ratio, how will the company plan the efficiency of its use of funds? In the future, are there clear plans for capital expenditures, M&A, or capacity expansion to avoid missing the development window in the storage industry?

Secretary of the Board’s Reply (Dongxin Co., Ltd. SH688110):

Dear investor, hello. The company is currently firmly seizing the historical opportunity of domestic substitution in memory chips, focusing on the domestic market, and building a flexible and efficient R&D, production operations, and sales system. In key areas such as product definition, design and development, mass production and shipment, after-sales service, and technical support, the company provides customers with one-stop support, effectively improving cooperation efficiency, and offering strong assurance for customers’ use of the company’s products and technology. Since its establishment, the company has consistently adhered to a development strategy of independent R&D and continuous innovation. After years of technology accumulation and R&D investment, the company has independently developed capabilities and core technologies in the design core areas of storage chips such as NAND, NOR, and DRAM. The company will, according to the trends in industry development and its strategic planning, and in combination with the needs of business development, reasonably plan the efficiency of fund utilization and carry out, at opportune times, capital operation projects that align with the company’s development strategy. Thank you for your interest in our company.

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Disclaimer: This information is excerpted by Sina Finance from public information and does not constitute any investment advice. Sina Finance does not guarantee the accuracy of the data; the content is for reference only.

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