In Chinese culture, the noble tradition of yinshi stretches back 3,000 years to the beginnings of Daoism. It translates as a hidden (yin) educated person (shi) and means someone who has forsaken the trappings of wealth, fame and power to find personal enlightenment. Today there are believed to be at least 5,000 yinshi, or hermits, living in the Zhongnan Mountains, southwest of Xi’an.
“A hermit living in the mountains” is exactly how the CBN newspaper describes the founder of Biel Crystal, Yang Jianwen. The company makes display screens for both the smartphones and smartwatches of Apple and Samsung. CBN says Biel has quietly built up its global market share to 60%, doing so from the not very solitary location of Huizhou in Guangdong.
According to CBN, Yang Jianwen is also a man of very few words, even with his own executives. He never grants interviews and typically works a 16-hour day.
However, his path to enlightenment appears to have suddenly changed course last month. Yang has come out of his hermetic seclusion and given interviews to both National Business Daily (NBD) and CBN in a week. (Biel, which was founded in 1986, has recently launched its official website too.)
Biel’s CEO still appears to be at one with nature, however. During his visit, CBN’s reporter says he was most keen to show off the factory’s plants and flowers.
He was also very proud of the staff canteen, although this emphasis on employee working conditions may be a belated deflection of criticisms from Hong Kong-based Sacom. In late 2013, the NGO denounced Biel for stale food its workers were forced to purchase as well as arduous working conditions, which had purportedly led to five suicides over two years.
The reason he has stepped into the limelight likely stems from Yang’s decision to float his company on the Shenzhen or Hong Kong Stock Exchange later this year. He hopes to raise $2 billion, suggesting a market capitalisation between $12 billion and $15 billion.
If he achieves his objective, the initial public offering will make him – on paper – one of China’s richest tycoons.
Competition with his former sister-in-law may have also forced Yang’s hand. Last March, Zhou Qunfei, who according to ThePaper.cn was married to Yang’s brother, was dubbed ‘China’s richest woman’ after she listed her company, Lens Technology (see WiC274).
Lens is now Biel’s archrival. Both derive the majority of their revenues from Samsung and Apple.
But Zhou’s fortune has crashed in tandem with the stock market. According to Forbes she is now worth $5.9 billion, down from almost $14 billion at Lens Technology’s peak share price. Biel’s listing may value the company at a premium over Lens.
Investors may have held faith with the sector’s valuation because they believe aggressive expansion by Chinese suppliers into sapphire production will pay off if Apple ditches Corning’s reinforced glass screens in favour of sapphire for the iPhone 7 (likely to be released this autumn). Biel has been investing heavily in sapphire glass through a joint venture with Roshow Technologies, another Chinese tech firm.
Yang tells NBD the venture is building the world’s largest sapphire production plant. “We have a supply shortfall,” he explains. “Demand will rise again this July so we urgently need to expand. By 2017 we hope to be supporting the production of 50 million smartphones.”
The rest of the tech community is more dubious, but some concur Apple will deploy sapphire screens for the iPhone 7. As we reported in WiC257, another Apple supplier, GT Advanced, went bust in 2014 after Apple decided not to use sapphire screens for the iPhone 6.
Sapphire is more scratch resistant than glass, but on the downside is prone to breakages, it costs more and it drains the battery faster. Financial analysts believe it will be a few more years before the technology is advanced enough to overcome these hurdles. In the meantime, Apple is using sapphire for its iPhone camera lens, heart monitor and the Apple Watch.
Biel – which began working with Apple in 2007 – has been growing fast, with revenues jumping from Rmb26 billion ($3.95 billion) in 2014 to Rmb36 billion in 2015. Its IPO should be one of the most interesting in Hong Kong this year.
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