On June 30, Linglong Tire submitted a prospectus to the Hong Kong Stock Exchange, seeking an “A+H” listing, with CITIC Securities and China Merchants International serving as joint sponsors.
Linglong Tire is a well-known domestic tire manufacturer.
According to Frost & Sullivan, Linglong Tire is the second largest tire manufacturer in the Chinese market and the sixth largest tire manufacturer in the global market, accounting for 4.4% of the global tire manufacturing market.
From a handmade tire manufacturing and repair factory on the verge of bankruptcy to becoming a domestic tire leader, Linglong Tire’s success is inseparable from its actual controller, the Wang Xicheng family.
According to relevant lists, the Wang Xicheng family ranks fifth with a wealth of 13.15 billion yuan.
Public information shows that Linglong Tire is a professional and large-scale tire manufacturer. Its products are used in passenger cars, commercial vehicles, engineering machinery vehicles, etc. It owns Linglong, ATLAS, Leo, EVOLUXX and other brands.
The prospectus shows that in 2022, 2023 and 2024, Linglong Tire will achieve revenue of 17.006 billion yuan, 20.165 billion yuan and 22.058 billion yuan respectively, and net profits attributable to the parent company will be 292 million yuan, 1.391 billion yuan and 1.752 billion yuan respectively.
During the reporting period, the growth rates of Linglong Tire’s net profit attributable to its parent company were 376.37% and 25.95% respectively, showing a fluctuating increase. However, the growth rate of its net profit attributable to its parent company in 2024 has been significantly lower than that in 2023.
In 2024, Linglong Tire’s overall gross profit margin will be 19.7%.
Based on global sales in 2024, the company ranks first in China’s OE tire market and third in the world, and has won the global new energy vehicle OE tire sales champion for five consecutive years.
Its customers cover eight of the top ten international automobile manufacturers and has built a global retail network through 1,240 distributors.
The main uses of funds raised from this Hong Kong stock listing include establishing and improving production bases around the world, strengthening Linglong Tire’s global influence, enhancing independent research and development and innovation capabilities, and enhancing global marketing strategies.
It is worth noting that part of the funds is planned to be used for the first phase of the construction project of the Brazilian production base.
Linglong Tire has been developing a globalization strategy in recent years. In September 2024, the company’s Serbian base phase one project was successfully mass-produced, making it the only Chinese tire company with a production base in Europe.
In terms of marketing, on September 9, 2024, Linglong Tire announced a multi-year cooperation with Chelsea, a well-known British football club, and became Chelsea’s global official tire partner.
On September 27, Linglong Tire announced a strategic cooperation with Real Madrid Football Club of Spain and officially became its global partner.
The control of Linglong Tire is in the hands of the Wang family.
The Wang family holds 52.86% of the equity of Linglong Tire. Based on this calculation, the Wang family has a wealth of nearly 11.4 billion yuan from Linglong Tire alone.
Linglong Tire was founded in 1975, formerly known as Zhaoyuan Tire Manufacturing and Repair Factory. At that time, the equipment was old and the technology was backward, and it could only do some tire retreading and repair work.
After seven consecutive factory directors in 12 years, the factory is already on the verge of bankruptcy.
In 1987, Wang Xicheng took over as the eighth director of Zhaoyuan Tire Manufacturing and Repair Factory. He insisted that with the development of the country’s economy, the tire industry would have great development, and persuaded the local government to continue to produce tires.
After taking office, Wang Xicheng led his employees to work hard on production and brought the tire factory on the verge of bankruptcy back to life.
In 2001, the company was transformed into a joint-stock enterprise, and Wang Xi’s eldest son Wang Feng became the general manager of Linglong Tire. He made important decisions such as introducing industry-leading complete sets of radial tire production and inspection equipment from abroad.
In 2000, benefiting from the substantial growth in domestic automobile industry output and the strong growth in tire exports, China’s tire industry began to recover, and Linglong Tire expanded rapidly.
In 2008, sales revenue exceeded 10 billion yuan. In July 2016, Linglong Tire was listed on the Shanghai Stock Exchange.
Now, Linglong Tire is sprinting towards the Hong Kong IPO and is expected to achieve greater development in the global market.
