This article is the 459th article that I share with you about the original IPO
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. Chairman, Mr. Zheng Yi, born in August 1964, bachelor's degree, served as assistant engineer at Radio Factory No. 8 in Foshan, Guangdong; engineer at the cassette player factory of Huaqiang Sanyo Electronics Co., Ltd.; deputy director of the general manager office of Shenzhen Sanyo Huaqiang Laser Electronics Co., Ltd., deputy director of the sales department of the design and development center, deputy director and director of the affairs management department; November 2008 From March 2010 to the present, he served as the deputy director, deputy general manager, executive general manager, general manager, and director of the investment management department of Shenzhen Huaqiang Industrial Co., Ltd.; from March 2010 to January 2020, he served as the general manager of Shenzhen Huaqiang Electronic Trading Network Co., Ltd.; from December 2015 to the present, he served as the chairman of Shenzhen Huaqiang Electronic Network Group Co., Ltd., etc.
. In June 2022, the company was awarded the "2021 Shenzhen Specialized and New Small and Medium-sized Enterprises" by Shenzhen Municipal Bureau of Industry and Information Technology; in January 2022, it was awarded the "2021 (Industry) Leading Enterprise" by the Boao Enterprise Summit Organizing Committee.
. During the reporting period, the company's asset-liability ratio was relatively high at about 57%; R&D investment was about 1%.
The net cash flow generated by the company's operating activities in the last two periods has continued to be positive.
Key information quick overview
Electronic Network is an industrial Internet B2B comprehensive service provider for the vertical industry chain of electronic components. The company is driven by digitalization, platform-oriented, and based on its online/offline combined B-side operation service capabilities to provide industry chain participants with professional global procurement services and comprehensive information services. The company is committed to establishing efficient connections between supply and demand parties of electronic components, reducing information asymmetry, and improving transaction efficiency and customer service levels in the electronic components industry chain.
Overview of this issuance
This electronic network will issue no more than 20 million shares, not less than 25% of the total share capital after the issuance; the company's main business income in 2021 is 3,128,779,500 yuan; the net profit in 2021 is 293,679,200 yuan; it is expected to use to raise funds ,401,010,010.
Issuance sponsor (also the main underwriter): Shenwan Hongyuan Securities Underwriting Sponsor Co., Ltd. ; Law firm: Beijing Jincheng Tongda Law Firm; Accounting firm : Tianjianhui Accounting Firm (Special General Partnership)
During the reporting period, the issuer’s main business income As shown in the table below:
During the reporting period, the company’s sales amount to the top five customers and the proportion of its main business income in the current period are as follows:
The total investment of the above project is 401.01 million yuan, and it is expected to use 401.01 million yuan of raised funds. After the funds raised this time are in place, if the amount of funds raised this time is less than the total demand for funds raised by the above-mentioned projects, the shortfall will be solved through self-owned funds, bank borrowings, etc.; if the actual amount of funds raised exceeds the planned amount of funds raised, the excess will be used for projects related to the main business, supplementing the company's working capital, or handled in accordance with the relevant regulations of China Securities Regulatory Commission and Shenzhen Stock Exchange . Before the raised funds are in place, the company will invest in advance with self-raised funds based on the actual needs of the project progress. After the funds raised through the public issuance of stocks are in place, the raised funds will be used to replace the pre-invested self-raised funds that should be attributed to the raised funds.
- During the reporting period, the issuer’s main financial data comparison is as follows:
From 2019 to 2021, the company's net profits attributable to the owners of the parent company were 40.5613 million yuan, 64.782 million yuan and 29 , 3.6792 million yuan, the net profit attributable to the owners of the parent company has increased year by year from 2019 to 2021; the growth rates are 9.71% and 53.33% respectively.
From 2019 to 2021, the net profit of company attributable to the owners of the parent company after deducting extraordinary profits and losses was 5.1054 million yuan and 59.1068 million yuan respectively. Yuan and 255.6426 million yuan, 019-2021 The company's net profit attributable to the owners of the parent company after deducting extraordinary gains and losses has increased year by year; the growth rates are
From 2019 to 2021, company asset-liability ratio were 1.67% and
From 2019 to 2021, the company's weighted average return on net assets were 6.15% and 26.03 respectively. % and 63.32%. From 2019 to 2021, the company's weighted average return on net assets has increased year by year, with the growth rates being 23.25% and
From 2019 to 2021, the operating income of company was 522.2352 million yuan, 698.9673 million yuan and 3.1287795 million yuan respectively. During the reporting period, the company's operating income increased year by year, with growth rates of 3.84% and 47.63% respectively.
- During the reporting period, the company’s operating capabilities were as follows:
From 2019 to 2021, the company's accounts receivable turnover rate were 5.07 times/year, 4.91 times/year, and 6.38 times/year respectively (that is, an average of 68 days to collect accounts receivable) in 2020 Compared with 2019, the company's accounts receivable turnover rate has declined slightly, mainly due to the impact of factors such as supply and demand changes in the industry. In 2021 The "shortage wave" in the electronic components market lasted for a long time in 2021. The company's operating income increased significantly, the industry prosperity increased, and customers received payment in a timely manner. Therefore, the company's accounts receivable turnover rate rebounded more significantly in 2021.
Inventory turnover rates from 2019 to 2021 were 13.29 times/year, 16.49 times/year and 35.10 times/year (that is, an average of 20 days from inventory acquisition to sale). The inventory turnover rate in 2020 has rebounded compared with 2019. The inventory turnover rate increased in 2020 compared with 2019, mainly due to the increase in revenue scale in 2020 and the corresponding increase in operating costs, resulting in an increase in the inventory turnover rate. The inventory turnover rate in 2021 has increased significantly compared with previous years. This is mainly due to the substantial increase in corporate income and the corresponding increase in operating costs. The inventory balance at the beginning of 2021 is low, resulting in a low average inventory balance in 2021. At the same time, due to the continuation of the "out of stock wave" of electronic components, customer order delivery times are shortened.
Science and Technology Innovation Highlights
Huaqiang Electronic Network Group takes data as its core capability and focuses on providing global procurement services and comprehensive information services for raw materials in the electronics industry chain. Due to the high degree of marketization of the Internet and related service industries, and the comparable domestic companies vertically involved in the electronic components industry are non-public companies, there is currently no authoritative organization that provides accurate market share data.
In recent years, Huaqiang Electronic Network Group has won many of the following honors and has been fully recognized by the market, which reflects the company’s growing influence in the industry and also confirms the issuer’s continuous improvement in its market position. In 2019 Some of the honors Huaqiang Electronic Network Group has received in the past years are listed below:
.2 Enterprise investment in science and technology innovation
During the reporting period, the company continued to invest in R&D, with R&D expenses of RMB 22.7906 million, RMB 26.076 million, RMB 56.1994 million and RMB 32.3064 million respectively, accounting for 4.36%, 3.73%, 1.80% and 1.56% of operating income respectively.
.3 Science and Technology Innovation Standard Analysis
Listing standard selected by the issuer:
According to the "Shenzhen Stock Exchange GEM Stock Listing Rules" (revised in 2020) issued by the Shenzhen Stock Exchange, the issuer has chosen the following specific listing criteria: " Net profits have been positive in the past two years, and the cumulative net profit is not less than 50 million yuan. ”
.4Profit model
The company is committed to establishing efficient connections between the supply and demand sides of electronic components to reduce To reduce information asymmetry and improve the transaction efficiency and customer service of the electronic components industry chain, there are two main profit models - the procurement service model and the information service model. Among them, the procurement service model achieves profits by earning the difference between purchase and sale in the form of transactions, and the information service model achieves profits by charging service fees in the form of services. In addition, the company also has a consignment service model and a SaaS service model, but they are still in the initial development stage and the scale of operations is small.
Inquiries and replies
.1Listing process
.2 Inquiry
About inventory
Reply based on application materials and review inquiry: (1) At the end of each reporting period, the book value of the company’s inventory is respectively 2,714.19 Ten thousand yuan, 36.3526 million yuan, 102.8003 million yuan and 124.8215 million yuan. (2) At the end of each reporting period, the issuer’s inventory balances beyond the average sales cycle (that is, the inventory age is 3 months or more) were RMB 8.5927 million, RMB 10.6976 million, RMB 39.7488 million, and RMB 51.5681 million respectively. As of September 30, 2022, the issuer's inventory balances of unrealized post-period sales at the end of each period were 2.1803 million yuan, 4.3881 million yuan, 30.7414 million yuan, and 59.4772 million yuan respectively. (3) At the end of each reporting period, the issuer's inventory amounts due to temporary cancellation of orders by customers were RMB 2.8496 million, RMB 5.3221 million, RMB 16.8962 million and RMB 24.5983 million respectively. As of September 30, 2022, the amount of the aforementioned inventory carried forward after the latest year and the end of the first period was 1.6124 million yuan and 433.3 thousand yuan respectively. The issuer has not agreed with the customer on compensation terms after order cancellation. (4) The inquiry responses showed that the issuer’s inventory purchase prices changed significantly during the reporting period.
The issuer is requested to explain: Update the current inventory carry-over situation after the period, explain the reasons and rationality for the inventory turnover time of unrealized after-period sales far exceeding the average sales cycle (about 18 days) during the reporting period; combined with the relevant inventory composition and market supply and demand, explain whether the relevant inventory is in a state of saturated demand, and whether the relevant inventory has the risk of slow sales.
replied to
Issuer's note: updates the current inventory carry-over situation after the period, explaining the reasons and rationality for the inventory turnover time of unrealized after-period sales to be far longer than the average sales cycle (about 18 days) during the reporting period; combined with the relevant inventory composition and market supply and demand, explain whether the relevant inventory is in a state of saturated demand, and whether the relevant inventory has the risk of being unsaleable.
1. Update the current inventory carry-over situation after the period, explaining the reasons and rationality for the inventory turnover time of unrealized after-period sales to be far longer than the average sales cycle (about 18 days) during the reporting period.
As of November 30, 2022 On the date of each reporting period, at the end of each reporting period, the issuer's inventory carryover and unrealized sales are as follows:
The issuer's inventory of unrealized sales after the period is mainly composed of the inventory formed by the issuer's stocking and customer cancellation of orders. The turnover time of this part of the inventory is long, far exceeding the average sales cycle. The reasons for the long inventory turnover cycle of this part of the inventory are: ① Due to the suspension, delay or cancellation of customer projects, the order demand decreases, and the customer temporarily cancels the order, resulting in the inventory of the customer's canceled order. Some related inventory customers will pick up the goods from the issuer again based on their own needs later, and some will be sold separately by the issuer. Affected by the customer's pick-up progress and the progress of finding new customers, the turnover cycle of the related inventory is longer. ② For the inventory in stock, this part of the inventory does not have the support of orders on hand. Customers place orders on demand. There is a certain inventory turnover cycle from product storage to final sales, resulting in a longer turnover cycle for related inventory.
In summary, the issuer’s inventory turnover time for unrealized post-period sales is far longer than the average sales cycle during the reporting period (approximately 18 days), which is consistent with the issuer’s actual situation and is reasonable.
2. Combined with the relevant inventory composition and market supply and demand, explain whether the relevant inventory is in a state of saturated demand and whether there is a risk of unsaleability in the relevant inventory.
From the perspective of product categories, as of November 30, 2022, the issuer’s inventory composition of unrealized post-period sales is similar to the issuer’s overall sales product composition, mainly integrated circuits , accounting for approximately 70%. The inventory composition of unrealized post-period sales is affected by many factors such as market supply and demand, the issuer's actual product types sold, product types temporarily canceled orders by customers, and product types tentatively stocked, and is consistent with its actual operating conditions.
From the perspective of application fields, as of November 30, 2022, the issuer's inventory downstream application fields that have not realized post-period sales are as follows:
The issuer's inventory that has not realized post-period sales has a wide range of downstream application fields, including industrial control, network communications , automotive electronics and consumer electronics , etc. In the first half of 2022, demand in industrial control, automotive electronics and other fields is still strong. Except for a decline in customer demand in the consumer electronics field, the issuer's customer demand in other fields has maintained overall growth.
The issuer's inventory that has not realized post-sale sales involves more than 1,400 SKUs, and the application areas are scattered. Therefore, the risk of slow sales caused by saturated demand in some downstream areas is dispersed, and the overall risk of slow sales is small.
Reference instructions:
Note 1: The above numbers and related information are from Shenzhen Huaqiang Electronic Network Group Co., Ltd. The latest prospectus (draft for the meeting) and the latest inquiry and response document
