The antenna leader has focused on these things for 25 years, only chasing the stars and the sea for the 5G era

The development of communication technology has made ordinary people "clair eyes" and "shun wind ears", but the precondition is a signal. If we say that the huge base stations erected on the surface of the earth are beacons marking the coverage of the signal, then the antennas seem inconspicuous but undertake the key task of receiving and transmitting signals are the bright lights at the top.

"Our company produces more than 5 million communication antenna products for online applications, covering more than 60 countries and regions around the world, and exporting volume account for 50% of our total sales." The general manager of Tongyu Communications, a listed company in Zhongshan, Guangdong, Shi Guiqing, introduced this to reporters. After 25 years of hard work, she and her husband, Wu Zhonglin, chairman of Tongyu Communications, have let Tongyu become a leading base station antennas company in the communications field.

When talking about the opportunity to start a business, she said that it was just "competing for breath". In the early 1990s, as a technician in a state-owned communications enterprise, Wu Zhonglin, plunged into the research and development of domestic antennas in order to break the monopoly of antenna technology controlled by foreign suppliers with excess profits. He and his wife, Shi Guiqing, both worked together to establish Tongyu Communication.

On March 28, 2016, Tongyu Communication was officially listed on the Shenzhen Stock Exchange.

In 2016, the company landed on the Shenzhen Stock Exchange and achieved rapid development. With the powerful engine of the capital market, it is planning to enter the new era of the communications industry. On March 28, Tongyu Communication's private placement of 900 million yuan was accepted by the China Securities Regulatory Commission. Tongyu Communications stated that it will strengthen the R&D and industrialization of optical modules and wireless communication systems in the future.

Looking back on the 25 years since its establishment, how did Tongyu Communications grow from a small company to a leading stock of base station antennas? In response to the rapid changes in the communications industry, how to achieve the transition from extensive to standardized? How to win orders from many key customers? Based in Guangdong, how will we move towards "high-quality development" by a diversified strategic layout in the future? The reporters of Nanfang Daily and Nanfang+ "Dialogue with the Heads of Guangdong Enterprises" entered Tongyu Communication and searched for the answer "signal".

Explore the story about capital 

Raising funds to build the world's largest microwave anechoic chamber

Nanfang Daily: Why did Tongyu Communications choose to go public in 2016? What is the main plan for fundraising requirements at the time of listing?

Shi Guiqing: In order to go public, the company made some preparations in advance. In 2010, Tongyu Communication was restructured into a company limited by shares. In fact, it encountered a lot of difficulties during the restructuring. Considering that the listed company is legally compliant, it did some long-term corporate norms. In 2012, we were affected by some factors when we submitted the application materials, and we stopped for a while. However, we have continued to actively report materials being able to pass the listing review also shows that our company is of high quality.

The purpose of listing is that the company has reached a development bottleneck, and the company wants to use the power of capital to break through the bottleneck and continue to grow. In fact, it has been profitable every year after operating for so many years. At that time, it was more about the future development of the company, as well as the treatment and rewards that could be given to employees after the company went public.

Nanfang Daily: How does the landing in the capital market play a role in the development of Tongyu Communication?

Shi Guiqing: As a corporate financing platform, the capital market is very helpful for development. In the year of listing in 2016, Tongyu Communications acquired the RF device assets and related businesses of Prism Microwave Oy of Finland for 6.05 million Euros. Through this company, we finally successfully obtained the certification of Ericsson, which had been unsuccessful for 10 years.

The world's largest microwave anechoic chamber built by Tongyu Communication

Part of the first fund we raised was used to build the Zhongshan R&D Center, and invested around 100 million to build the world’s largest microwave anechoic chamber. This microwave anechoic chamber is very helpful for product testing. With better stability indicators, we can develop big market. Some automation equipment and instrumentation were also updated. In 2017, Tongyu Communications acquired Xi'an Xinghengtong and Shenzhen Opway and entered the field of satellite communications and optical communications. Recently, we have got another 900 million yuan by private placement in order to expand the market scale of optical modules in the future and make it bigger and stronger in market and R&D.

In 2017, Tongyu Communications acquired Shenzhen Opway and entered the field of optical communications

Nanfang Daily: What actions has Tongyu Communications taken in terms of dividend returns to shareholders?

Shi Guiqing: Actually, I don't think I have done well enough in this regard. After the listing, our profits in 2018 and 2019 were a little bit small, and the cost control in the company's internal control management was not very good, which led to a sharp decline in profits in those two years. As soon as I noticed the performance in 2019, I suddenly came to my senses and introduced a more professional team at the beginning of 2020. Therefore, after changing the management team in 2020, our performance has improved significantly compared with the previous year.

Therefore, we feel that the return to the shareholders of the capital market is not enough, only more than 70 million yuan. I hope that the shareholders who support us should have a good return. This is our responsibility. Tongyu Communications will redouble its efforts this year and next year, striving for great growth in the next five years.

Decoding company operations

How to make the base station antenna company becoming leading?

Nanfang Daily: Why did the couple think of establishing Tongyu Communication in the first place?

Shi Guiqing: In the 1990s, my husband Wu Zhonglin worked at China Mobile. He was responsible for mobile network planning and professional on antennas. At that time, no one in China made antennas, and he faced a "stuck neck" situation. The unit price for purchasing foreign antennas was about US$3,000 per antenna. A simple antenna would cost more than RMB 20,000 at that time, but the actual cost of the antenna was less than 1,000 yuan. He used his spare time to develop the antenna himself, and felt that if he didn't do it, no one would do it, so he worked on the antenna design very hard, even overnight. In 1994, the first panel-shaped base station antenna in China was developed. After our product design was completed, it passed the certification of Guangdong Province. After foreign manufacturers knew that our product was certified, they also reduced the price from 3,000 US dollars to 6,000 yuan. In 1996, we registered the company.

In 1994, Wu Zhonglin, the founder of Tongyu Communication, successfully developed the first mobile communication base station antenna in China

Nanfang Daily: From the 2G era to the current 5G era, what is the development path of Tongyu Communications?

Shi Guiqing: In the 2G era, we were follower. At the earliest we had to get inspiration from other products, and then did some tests to verify our ideas, at that time, we were also recognized by some overseas customers. In the 3G era, we were catching up. At that time, we already had a lot of patents and got more and more customers. We started to sell our products to overseas customers in 2005. Around 2012 and 2013, when 4G began to explode in China, there were many orders. During the 4G era, we began to surpass. Now in the 5G era, Tongyu Communications is leading the way. We have done many projects with more patents and more customers, including ZTE, Ericsson, and Datang, they use our products in the majority and the volume account for a relatively large share in our total sales. I believe that in the future 6G, Tongyu Communications will strive to be more advanced.

In December 2015, Tongyu Communications implemented the organization model of the division system and established the microwave antenna division on a trial basis

Nanfang Daily: What are the main customer groups of Tongyu Communication? How to get the trust from the good customers?

Shi Guiqing: We have been in overseas markets since 2005, so Tongyu's customer base is very high-quality. In 2006, Tongyu Communication passed the certification of Alcatel-Lucent and ZTE; in 2008, it passed the certification of Nokia-Siemens. It is also a global supplier certified by system equipment vendors such as Huawei, ZTE, Nokia, Ericsson, and Datang, and has been certified by many operators such as China Mobile, China Telecom, China Unicom, and Vodafone and Telefonica.

For example, during the 2020 epidemic, Tongyu Communications increased cost control and integrated departmental resources. The annual net profit is expected to increase by more than 178% year-on-year. We received a lot of 5G orders last year. At that time, when many of our peers had difficulties in delivery, we went all out and quickly delivered some orders in time, and then our customers gave us more orders. As long as you provide good customer service and technology is always advancing, I don’t think there is any need to worry about orders. Of course, there must be a sense of crisis. If there is no sense of crisis, it is impossible to think of ways to get more orders, and will not think of ways to carry out technological innovation. The sense of crisis is also a kind of culture in Tongyu Communication.

Nanfang Daily: What is Tongyu's investment in scientific research?

Shi Guiqing: In fact, we are spending money on scientific research investment. Tongyu Communication's annual scientific research funding is more than 100 million yuan. Our company has a scale of less than 2 billion yuan, but the investment in research and development funds is nearly 100 million yuan. In addition, it also has cooperation with universities such as Tsinghua University and Xidian University.

Overweight diversified layout 

How to achieve high-quality development of Tongyu Communication

Nanfang Daily: How do you feel about the construction of Guangdong's capital market?

Shi Guiqing: Regarding the listing, the Zhongshan Municipal Government supports our company very much. When I resumed work and production last year, I took special care and sent masks. I think Guangdong’s policies are very good. Including the policies introduced by Shenzhen, we go there to develop, and provide guidance and support for rent subsidies and our talent development. It also includes the Zhongshan City Government’s proposal for school choice for the children of our listed company executives, which also gave a lot of guidance and support.

Nanfang Daily: How will Tongyu Communications further plan the company's development in the Guangdong-Hong Kong-Macao Greater Bay Area in the future?

Shi Guiqing: Like now we go to Shenzhen to set up an R&D center and move some markets to Shenzhen. Maybe some overseas markets will also go to Shenzhen. Why? Because in the context of the Guangdong-Hong Kong-Macao Greater Bay Area, after the Shenzhen-Zhongshan Passage is open, our R&D personnel will develop in Shenzhen, but it is still very convenient to get to Zhongshan. Therefore, we proposed a five-year strategic plan last year. The 100 billion Tongyu Communications and the annual sales increase of more than 30% are based on the considerations of the Guangdong-Hong Kong-Macao Greater Bay Area and also the strategic considerations of Tongyu.

In the past five years, although we acquired Shenzhen Guangwei, the development has been relatively slow, because we are relatively stable and afraid of various risks in the acquisition, so we have always been very steadily thinking about how to do it, but after thinking about these 5 years After that, I wanted to understand, so I took a big step to run forward, so Tongyu's stamina is very driving force.

In 2021, Tongyu Communications will purchase 41.1764% equity of Shenzhen Guangwei Guangtong Communication Technology Co., Ltd., realizing 100% holding

Nanfang Daily: In the future, what strategic plan will Tongyu Communications have to help the company develop with high quality?

Shi Guiqing: At the end of last year, we sorted out the company's strategy and set the development goal of "One hundred years of Tongyu, one hundred billion Tongyu". The strategic framework of Tongyu is now "driven by two engines and supported by two wings." "Shuangqing" is our current industry, and radio frequency communication and optical communication are still the company's pillar industries. In the area of our antenna filter microwave antenna, we will quickly enter the top three in the world in the next 3 or 5 years. The other is optical modules. We will focus on building optical modules in the next 5 years and strive to become an excellent enterprise in the first echelon.

The "two wings" are new energy and communications private networks. Tongyu Communication is already the number one supplier of China's tower switch cabinets, and hopes to continue to increase the layout of the Internet of Things and new energy, and both software and hardware will be available. The communication private network business will also be a new growth point for the company in the future. This big piece may also be a stronger support for Tongyu Communications in the future. This will not only reach 100 billion in output value.