Cubic Sensor Invests in LOPE and Jingding Electric to Create a Comprehensive Supply Chain for Intelligent Gas Boilers

Move Towards a One-Stop Solution for High-Efficiency, Low-Emission Gas Heating

On April 29, 2024, the strategic investment cooperation agreement signing ceremony between Cubic Sensor and Instrument Co.,Ltd. (hereinafter referred to as “Cubic”), Zhongshan LOPE Thermal Technology Ltd. (hereinafter referred to as “LOPE”), and Guangzhou Jingding Electric Technology Co., Ltd. (hereinafter referred to as “Jingding Electric”) was held at Cubic R&D Center.

At the recent signing ceremony hosted by Zhiqiang Liu, General Manager of Cubic, key figures from the industry gathered to formalize a strategic investment collaboration. The attendees included Dr. Youhui Xiong, Chairman of Cubic; Chengjie Deng, Chairman of LOPE; Rixin Lai, Controlling shareholder of Jingding Electric; along with the management teams from all three companies. Qi Wang, director of the Utilization Committee and Gas Heating Committee of the China Gas Society of the China Civil Engineering Society, was also present as an honored guest to witness the ceremony.

During the event, Xiangjun Kong, Vice General Manager of Cubic, provided a detailed overview of the strategic partnership. Subsequently, Dr. Youhui Xiong, Chengjie Deng, and Rixin Lai signed the cooperation agreement, which stipulates that Cubic will acquire a 57.14% equity stake in LOPE and a 51% stake in Jingding Electric through a combination of capital transfer and capital increase. This strategic move marks a significant expansion in Cubic's portfolio and a deepened cooperation within the industry.

Director Qi Wang witnessed the signing ceremony and delivered a speech, saying,

"Currently, in the wall-mounted gas boiler industry, the trend of leveraging sensor technology for intelligent upgrades and applying full premixed condensing technology to improve thermal efficiency and reduce pollutant emissions is becoming increasingly evident. Cubic will fully utilize its advantages in gas sensor technology to rapidly expand its business landscape in the full premixed condensing wall-mounted gas boiler industry. It is worth looking forward to its collaboration with LOPE and Jingding Electric, which will contribute significantly to development of the industry."

Data released at the annual Chinese gas heating industry conference reveals that China's market inventory for wall-mounted gas boilers exceeds 34 million units. Notably, over 10 million of these units are more than eight years old, and around 5 million are aged between 10 and 15 years, highlighting a substantial potential market for replacements. Currently, the majority of these boilers are direct gas-fired types, which are notably inefficient in terms of combustion and produce high emissions. Meanwhile, condensing wall-mounted gas boilers, which are more efficient and environmentally friendly, make up only about 2.3 million units, or 7% of the total inventory. This situation underscores a critical need for China to shift towards developing new, high-end, fully premixed condensing wall-mounted gas boilers.

Leveraging its gas sensor technology platform and the technical and industrial accumulation of its core management team in the field of combustion science and technology, Cubic has established a post-doctoral R&D team from 2022 and initiated the development of low-carbon thermal technology based on gas, aiming to build an industrial ecosystem for residential, commercial, and industrial gas boilers with sensors, actuators, and controllers as the core supply chain.

Currently, Cubic has made breakthroughs in the R&D of gas sensors for new types of full premixed condensing wall-mounted gas boilers, as well as in direct current brushless fans and intelligent gas combustion controllers, earning recognition from experts within the industry. Simultaneously, experimental facilities have been established for key components including gas proportional valves, gas burners, and heat exchangers for full premixed condensing wall-mounted gas boilers, and Cubic have initiated business negotiations for cooperation with Chinese core component supply enterprises.

Zhongshan LOPE Thermal Technology Ltd.

LOPE is currently the only Chinese stainless steel full premixed condensing heat exchanger manufacturer that has imported international advanced equipment and technology. It is one of the few companies globally that simultaneously possess condensing heat exchanger and full premixed combustion technology.

LOPE's products boast an impressive coverage rate of over 80% in the market for Chinese branded full premixed condensing wall-mounted gas boilers, and also are exported in large quantities to European markets. These products have received widespread acclaim from both domestic customers in China and international clients. LOPE has achieved factory quality management system certification and operates its own testing center and thermal laboratory. Furthermore, the company has established a cooperative research and development center in Europe, secured multiple patents, and has become a highly specialized manufacturer in the field of full premixed condensing wall-mounted gas boilers.

Guangzhou Jingding Electric Technology Co., Ltd.

Jingding Electric has accumulated nearly two decades of experience in the field of gas proportional valves, with a commitment to "Elaborate quality, Innovative technology." It is a significant standard drafting or participating member in the China gas appliance industry. The general manager of Jingding Electric serves as an ISO registered expert and has participated in numerous international ISO/TC161 technical committee working meetings. With over 30 patents, including its gas proportional valve product being recognized as a "Famous Brand of Guangdong," Jingding Electric has also been honored as " the Best 10 Gas-Appliances Components Company " and "Excellent Enterprise in China's Gas Appliance Industry."

Through the strategic investment, Cubic aims to integrate resources related to stainless steel heat exchangers, burners, gas proportional valves, variable frequency direct current brushless fans, gas sensors, intelligent gas combustion controllers, and other components involved in full premixed condensing wall-mounted gas boilers, establishing a "sensor-actuator-controller" one-stop supply chain solution in this field.

Dr. Youhui Xiong stated during the signing ceremony, saying,

“LOPE has become one of the few enterprises globally capable of mass-production of stainless-steel condensing heat exchangers after seven years of hard work, leveraging international scientific and technological resources. Jingding Electric, with nearly two decades of experience in the gas proportional valve field, is an important standard drafting or participating member in the China gas appliance industry. Cubic possesses significant technological and industrial advantages in gas sensors, gas metering, and intelligent gas controllers. By leveraging the significant industrial opportunities and the expansive, cohesive domestic market fostered by the 'dual-carbon' goals, our tripartite collaboration and deep cooperation are set to powerfully accelerate the evolution of China's full premixed condensing wall-mounted gas boiler sector towards premium branding.”