Shenzhen O-film Tech Co. Chairman Cai Rongjun has become a billionaire after shares in the Chinese touchscreen glass-panel maker soared nearly 178 percent this year on higher demand for tablet computers

July 4, 2013 Leave a comment

Cai Emerges as Chinese Billionaire With Touchscreen Glass

Shenzhen O-film Tech Co. Chairman Cai Rongjun has become a billionaire after shares in the Chinese touchscreen glass-panel maker soared nearly 178 percent this year on higher demand for tablet computers.

Cai, 41, has a net worth of $1 billion after the stock advanced 10 percent yesterday, according to the Bloomberg Billionaires Index. He hasn’t appeared on any international wealth rankings. The bulk of his fortune consists of a 22 percent stake in the company, which supplies screens to Lenovo Group Ltd. (992), Samsung Electronics Co. and Sony Corp.Tablets have emerged as a primary avenue to tap the Internet following Apple’s iPad debut in April 2010. Samsung, Google Inc. and Amazon.com Inc. followed with their own devices and helped propel a 78 percent increase in shipments to 128 million units in 2012, according to Bloomberg Industries analysts George Mykytyn and Anand Srinivasan. Tablets now represent a third of all personal computers made, they said.

“Demand for large touchscreen displays is exploding, resulting in a huge gap between supply and demand,” Wei Xingyun, an analyst at Guotai Junan Securities wrote in a note to clients on March 12. He rates Shenzhen O-film stock “overweight.” “The company’s capacity expansion is set to boost full-year profit.”

Net income climbed to $52 million in 2012 from $3.4 million in 2011 as Cai expanded manufacturing while accumulating orders. Sales from touch screens for tablets and smartphones accounted for 90 percent of 2012 revenue of $638.6 million, up 216 percent from 2011, according to data compiled by Bloomberg.

Lenovo Large

Lenovo, its biggest customer, reported a 90 percent gain in fourth-quarter profit on May 23 after increasing its market share and boosting smartphone sales. Lenovo introduced touchscreen handsets in Russia, India, Indonesia, Vietnam and the Philippines last year following the debut of its first model in China in 2010. It plans to enter Africa next.

Cai graduated from Shantou University in Guangdong province, a school funded by Asia’s richest man Li Ka-Shing. He worked for Eastman Kodak Co. (EKDKQ) as a technician, engineer and manager between 1995 and 2001. In 2004, Cai and Hong Kong-based Yugao China Co., owned by his brother Cai Gaoxiao, acquired the predecessor of O-Film, according to a prospectus.

Shenzhen O-Film spokeswoman Cheng Xiaoli confirmed Cai’s shareholdings and declined to comment on his net worth calculation.

The Bloomberg Billionaires Index is a daily ranking of the world’s richest people. In calculating net worth, Bloomberg News strives to provide the most transparent calculations available. Each Bloomberg Billionaire profile contains a detailed analysis of how that person’s fortune is tallied.

The index is a dynamic measure of the world’s wealthy based on changes in markets, the economy and Bloomberg reporting. Each net worth figure is updated every business day at 5:30 p.m. in New York. Stakes in publicly traded companies are valued using the share’s most recent closing price. Valuations are converted to U.S. dollars at current exchange rates.

To contact Bloomberg News staff for this story: Michael Wei in Shanghai at mwei13@bloomberg.net

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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