Dongshan Group, Zhao Jinshan held up last quarter’s financial report with a smile on his face.

"The price of thermal coal this year is not less than 800 yuan. Even a money printing machine can't generate money as quickly as our mine. We will make a lot of money this year!" Zhao Jinshan continued;

Now that the coal market is good, we have to increase investment."

"I don't think so." Li Weidong shook his head and continued, "The coal market should be good next year, but the coal cycle is about to end. We have to shrink our business and prepare for the cold winter of the coal industry."

Zhao Jinshan was slightly stunned, thought for a few seconds, and then nodded: "Listen to you, your judgment of the market has always been the most accurate. If you say we will shrink the coal business, then we will shrink it!"

Coal prices have always been cyclical, with a cycle lasting about four to six years. The last time coal prices fell occurred in 2008, when prices were at their peak, coal prices once exceeded four digits, with fluctuations measured in minutes.

.However, the boom was followed by a decline. The outbreak of the subprime mortgage crisis led to a global economic recession, and coal prices also began to fall.

As the country has introduced a "four trillion" economic stimulus plan, large-scale investment in infrastructure, the production of steel, cement, and various building materials used in infrastructure are inseparable from coal, so the price of coal has risen again.

As the United States emerged from the subprime mortgage crisis and the international economic situation recovered, domestic coal prices reached a peak again in 2011.

After the peak, it is the beginning of the next cycle. In 2012, coal prices have begun to fall. However, because production capacity has reached its peak, coal companies have made pretty good profits by selling more in quantity.

By 2013, China's economic growth began to slow down, coal demand decreased, and the country began to import coal on a large scale. This year, China's coal imports reached 350 million tons, compared with only 50 million tons five years ago.

The increase in imported coal has caused coal prices to begin to fall rapidly, and coal prices have dropped from a peak of more than a thousand yuan per ton to more than a hundred yuan per ton.

As a result, the profits of coal companies have also been significantly reduced. Large coal companies have basically cut their profits in half for three consecutive years. The original profit of 100 yuan was cut in three waves to 12.5 yuan. Smaller coal companies simply suffered losses. That year

Those rich people who made a fortune from coal have all turned into cowards.

The coal market did not start to improve until 2016, and then began to soar. In 2021, it once reached 2,000 yuan per ton. When will we feel that coal that cost 800 yuan per ton back then is really cheap.

Facing the coming coal recession cycle, continuing to increase investment is obviously a suicide move. Dongshan Group's coal mining business will also shrink. Li Weidong even pondered that when the coal industry hits the bottom in 2015, there will be a wave of low prices.

Buy the dip.

Li Weidong continued; "The coal business will shrink, but the real estate business can expand, such as some new first-tier cities and second-tier cities. We can invest on a large scale, such as provincial capital cities in the southwest and several cities along the Yangtze River.

The future economic development of this important town is promising, so if you go into real estate business there, you should get relatively generous returns!"

"I'm very optimistic about large-scale commercial complexes. It's a one-stop shop for eating, drinking and entertainment. You can make a lot of money by collecting rent. Many real estate companies are doing it. Should we give it a try?" Zhao Jinshan said.

asked.

"You only see thieves eating meat, but you don't see thieves being beaten! Large commercial complexes make money, but their management level must keep up. Without high-level management, they will soon go bankrupt, and so will large investments.

We lost all our money. We don’t have management talents in this area." Li Weidong said helplessly.

Once a large-scale commercial complex is completed, it is indeed a money printing machine, but if it is not done well, it will become a bottomless pit. There are commercial complexes that have failed in every city. Some have never been popular since they opened, and some have failed.

It was very popular a few years before it opened, and then it became a bust.

In addition to location, facilities, and other hardware factors, the most important thing is operational capabilities. Those commercial complexes with good operating conditions must have the support of a strong operational team.

Commercial operations are not Dongshan Group's strength. Hong Kong-owned real estate companies have decades of experience in this area, and state-owned real estate companies also have a good reputation. It is difficult for Dongshan Group to compete with them.

However, Zhao Jinshan was a bit stubborn, and he said: "If we don't have talents, we can hire them with high salaries, or find a mature operation team. Look at the large commercial complexes in Beijing, they are so beautiful and crowded with people every day.

If we really make money, it would be a pity if we didn’t do it.”

"Okay, if you want to do it, let's try it. However, the competition in first-tier cities is too fierce, and the market in third-tier cities is not big enough, so we should focus on second-tier cities!"

Li Weidong pondered for a few seconds and then said; "In addition, I have a suggestion. If you build a large-scale commercial complex, you should mainly introduce catering and experience businesses, and you can even invest in a few such brands. There will be fewer retail businesses.

good."

"Aren't you optimistic about the retail industry? But those commercial complexes all rely on big retail brands to support their appearance." Zhao Jinshan said.

"The consumption patterns of ordinary people are changing. You should have seen the news about the Double Eleven of Xinbaobao. Although it has only been carried out for two years, it has grown very rapidly. The Internet will change the pattern of the entire retail industry. The traditional offline model,

It will gradually be replaced by online models. But experiential consumption cannot be replaced by the Internet for the time being."

Li Weidong paused and then said, "As for those top brands, they will definitely choose well-known commercial complexes to settle in. How could they get our turn? Rolex can't be stupid enough to come to us to sell watches, right? We have just entered this field.

Thank God if we can attract a brand like KFC to settle here!”

Although Zhao Jinshan felt a little unhappy after being criticized by Li Weidong, he had to admit that what Li Weidong said was right.

With the development of the Internet, consumption patterns have changed. The commercial complex has changed from the so-called "integration of eating, drinking, playing and shopping" to "integrating eating, drinking, playing and shopping", and "shopping" has gradually disappeared. The retail industry has shifted from offline to

Online, not to mention clothes, shoes and socks, even daily necessities such as toilet paper, there are many purchased online.

When there are no theatrical blockbusters, many commercial complexes simply become "big canteens". Ordinary families bring their families here just to queue up for the next restaurant, so and so to get hot pot, but the brand stores are empty.

Li Weidong continued to introduce; "If it is really difficult to attract investment, we will invest in a few franchise stores ourselves, such as hot pot, barbecue, milk tea, fast food and other franchise stores, all with standardized recipes, even the cooks are omitted, as long as

If we can ensure food safety, recruit a few waiters and train them, we can open the business.”

"Listening to what you said, it's really easy to open a hot pot restaurant. After all, the food is all raw meat and lettuce. Let the customers cook it themselves. If the food is not cooked well or is old, the customers themselves have to recognize it. This saves the cook.

If it doesn’t taste good, you’ll get complained.”

Zhao Jinshan chuckled, and then said: "How about I also create a hot pot brand! Isn't there Donglaishun and Xilaishun in Beijing? My name is Zhao Jinshan, and here comes Jin Laishun, and I also create a hot pot chain brand, open to

All regions across the country!”

"If you want to engage in a hot pot chain, you should consider Sichuan hot pot!" Li Weidong said.

"Why? The taste of Beijing-style hot pot is no worse than that of Sichuan-style hot pot! And not everyone can eat spicy food." Zhao Jinshan said.

Li Weidong replied: "Think about it, what if a guest has diarrhea after eating hot pot? If it is Sichuan style hot pot, it can be said that it is too spicy and irritates the stomach, but if it is Beijing style hot pot, the guest will most likely have to think about the ingredients.

Whether it’s fresh or not, the hot pot restaurant won’t be able to take the blame when the time comes!”

"That makes sense! I can imagine all this. You are really born to do business!" Zhao Jinshan nodded as if he was suddenly aware.

"One more thing, I plan to get rid of all the shops on Hong Kong Island." Li Weidong continued.

"Sell them all? Why? Those shops of yours can make a lot of money every year just by collecting rent, and the rate of return is several times higher than bank financing!" Zhao Jinshan said, showing a mysterious look, and asked in a low voice

: "Is there going to be another financial crisis? Is the property market in Hong Kong Island going to fall?"

"You are overthinking. There is no financial crisis. In the short term, Hong Kong Island's property market is still bullish. In the medium to long term, the return rate on shop rentals will exceed that of bank financial products. I want to sell the shop because I am simply short of money."

Li Weidong replied.

"You, Li Weidong, will be short of money? Hahaha, don't you usually look at various rich lists? When has your name, Li Weidong, not been at the top? If you were short of money, I would starve to death three times!" Zhao Jinshan laughed happily

said.

"I want to make a long-term investment, so I need to withdraw part of the funds." Li Weidong then replied.

"I helped you buy those shops on Hong Kong Island. The prices have skyrocketed over the years, especially the shops in Causeway Bay, which are a few tens of square meters. They are now worth hundreds of millions of Hong Kong dollars! If you sell them all

If so, it could probably be sold for several billion Hong Kong dollars! What big project are you planning to do?" Zhao Jinshan asked.

Li Weidong did not hide anything. He said, "I plan to chip. This is a long-term investment project. It will be good to see results within ten years. In the chip industry, the investment is very huge, not to mention billions of Hong Kong dollars.

Throwing tens of billions of dollars into it will only make a sound!

A few years ago, I invested in a sensor factory, and now it can make sensors for general household appliances. Now Jaguar Land Rover has built a factory in China, and in the future, it will jointly develop electric vehicles with BYD, which will require a large number of automotive chips. So I

Cooperate with BYD to build a company that produces automotive chips."

…

The past few years have been the golden age of the coal industry. Mining coal is like printing money. Especially after the national government closed down a large number of small coal mines, medium and large coal mines have become large money printing machines.

Nowadays, coal prices are about to undergo a cyclical adjustment, and the money printing machine is about to be shut down. But fortunately, real estate has begun to rise rapidly. Dongshan Group has already made plans in this area. The real estate business can still bring Li Weidong a lot of financial income.

.

In the next seven or eight years, real estate will continue to be hot. At this time, there is no need to consider any risk issues. Just expand mindlessly. The faster the expansion, the greater the returns. Being restrained will reduce the returns.

Li Weidong needs funds, mainly for the chip industry.

If you want to get involved in the chip industry, you must have a lot of funds. The demand for funds in this industry is really too great. For the chip industry, hundreds of millions of dollars is just a buzz.

The future US$55 billion chip bill in the United States sounds like a lot, but it is only a drop in the bucket when it is invested in the entire chip industry. For the chip industry, let alone tens of billions of US dollars, even if trillions are poured into it, it may not be enough.

Create a complete chip industry chain.

As for automotive chips, if it is not to ensure the security of the supply chain, it is not cost-effective to develop this industry specifically. It is much cheaper to directly buy finished products than to make them from scratch.

The market size of automotive chips is still very large. A traditional household fuel vehicle needs about 500 to 600 chips, a luxury fuel vehicle can use 800 chips, and an ordinary new energy vehicle can use more than 1,000 chips.

, and high-end energy vehicles, such as those with intelligent driving functions, require more than 1,500 chips.

In terms of quantity alone, the demand for automotive chips is second only to household appliances.

However, the profit of automotive chips is not large, and it is a small profit but quick turnover type. Because the size of the car is relatively large, there is no requirement for the size of automotive chips.

Cars are different from mobile phones. In order to pursue thinner and lighter electronic products such as mobile phones, they use smaller and faster computing chips. A mobile phone can be dozens of grams lighter, even one millimeter thin.

Selling point.

For the chips used in cars, if one chip is not running fast enough, then use two chips. Two chips are not enough for the fourth sister. Anyway, a car weighs two tons, so it doesn’t matter how many kilograms more chips are used. There is room for installing larger chips.

It is also for this reason that most of the chips used in automobiles are low-end chips. Only some intelligent systems, such as autonomous driving and AI services, use high-end chips.

Low-end chips have low technical barriers to entry and are easy to manufacture. In the chip supply system, they belong to the category of large quantities and full management, so profits are naturally low. Moreover, the automotive market has been divided up, and it is more difficult for latecomers to enter this field.

of.

To give a simple example, TSMC will begin mass production of 7nm chips in 2018. The previous 10nm, 14nm, 22nm, and even 90nm production lines will continue to operate, and the low-end production lines will be converted to produce automotive chips.

TSMC has accumulated many years of technology and experience in these low-end production lines, which allows it to control costs. The products also have relatively good performance and yield, and will naturally be more competitive when brought to the market.
To be continued...