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According to the author's search for the company's prospectus, Kangpeng Technology's traditional core business showed that the price of materials continued to decline, resulting in a downward trend in the revenue of the business. At the same time, its new energy new energy battery materials and electronic chemical business is also facing the impact of price declines and customers reducing purchases. Affected by this, Kangpeng Technology's inventory and accounts receivable have been rising year by year, which will have a negative impact on the company's operating performance.
The performance of traditional business is declining
Kangpeng Technology is a technology-driven enterprise deeply engaged in the field of fine chemicals. Its products are new materials, pharmaceuticals and pesticide chemicals. Among them, the new material products mainly cover display materials, new energy battery materials, electronic chemicals, silicone materials and other fields.
From 2016 to 2021, Kangpeng Technology achieved operating income of 599 million yuan, 637 million yuan, 704 million yuan, 687 million yuan, 629 million yuan, and 1.005 billion yuan. The corresponding net profits are RMB 127 million, RMB 142 million, RMB 329 million, RMB 143 million, RMB 93 million and RMB 138 million, respectively. Both revenue and net profit have fluctuated dramatically.
This is closely related to the continued decline in revenue of its traditional main LCD display material business. From 2016 to 2021, Kangpeng Technology Display Materials' revenue was RMB 402 million, RMB 390 million, RMB 383 million, RMB 325 million, RMB 309 million and RMB 348 million, respectively, accounting for 68.05%, 62.33%, 56.46%, 49.50%, 51.49% and 36.04% of the total revenue, respectively, showing a downward trend.
industry is well known that liquid crystal materials are the core raw materials of LCD panels, and their performance and quality directly affect the overall display performance of LCD panels. Since its establishment, Kangpeng Technology has maintained good cooperative relations with international mixed crystal giants such as Japan's JNC and Germany's Merck, and is its important supplier.
In recent years, with the increase in the domestic production rate of liquid crystal materials, Kangpeng Technology has gradually established cooperative relations with domestic mixed crystal manufacturers such as 800 million Time and Space, Jiangsu Hecheng, and the company's product shipments rank among the forefront of the industry. According to the 5% loss of 5% of the global TFT mixed liquid crystal market size in 2021, Kangpeng Technology's market share exceeds 14%.
However, as domestic liquid crystal material companies accelerate their layout in the field of fluorine-containing liquid crystal materials, competition in the display materials market has intensified, and the prices of this series of products have also declined year by year.
2019-2021, the unit price of K0015 of Kangpeng Technology display material was 10442.96 yuan/kg, 9194.40 yuan/kg, and 7841.64 yuan/kg; the unit price of K0016 was 10414.02 yuan/kg, 9160.06 yuan/kg, and 7740.96 yuan/kg; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 was 8 respectively; the unit price of K0030 939.08 yuan/kg, 8593.08 yuan/kg, 6989.41 yuan/kg; the unit price of K0056 is 18691.06 yuan/kg, 17301.10 yuan/kg, and 14880.97 yuan/kg; the unit price of K0057 is 19554.93 yuan/kg, 18146.22 yuan/kg, and 15568.68 yuan/kg, respectively, and the prices of all products are showing a rapid downward trend.
Kangpeng Technology said that during the reporting period, the company's main display price of material products has declined overall, mainly due to intensified competition in the downstream display panel industry, and the cost reduction transmission as technology matures and output increases.
new business has been questioned by the market
Against the backdrop of the decline in display materials business, Kangpeng Technology has accelerated its layout of new energy battery materials and electronic chemicals businesses, pharmaceuticals and pesticide chemicals businesses. Although the revenue scale of the two major businesses has achieved rapid growth, there are also various problems.
In "Frequent safety accidents occur and product prices are lowered to grab the market. Can Kangpeng Technology successfully pass the second impact on the Science and Technology Innovation Board? In the article 》, the author pointed out that Kangpeng Technology's subsidiary Quzhou Kangpeng mainly produces new energy battery materials and electronic chemicals (LiFSI products). The subsidiary suffered multiple production safety accidents in 2020, resulting in the factory shutdown, which affected the production capacity of its core product LiFSI. The revenue of this business also declined that year.
It is worth mentioning that the unit price of LiFSI products has declined year by year. In addition, Kangpeng Technology's downstream customers have begun to plan the LiFSI project. As downstream customers build their own LiFSI production lines and put them into production smoothly, and their own production lines can meet their own product needs, they will inevitably reduce the purchase of LiFSI products from Kangpeng Technology, and its business will also be affected.
In the pharmaceutical and pesticide chemicals business, Kangpeng Technology has the problem of former employee shareholding companies jumping into major customers.
data shows that in 2017 and 2018, Duchuang Technology did not enter the list of Kangpeng Technology's top five customers. In 2019, the company became Kangpeng Technology's largest customer of pharmaceutical chemicals, contributing sales revenue of 52.89 million yuan to Kangpeng Technology, accounting for 40.44% of the company's pharmaceutical chemical business revenue that year.
It should be pointed out that in 2019, Kangpeng Technology's overall revenue of its pharmaceutical and chemical business was 141,000 yuan less than the previous year. In other words, without Duchuang Technology's "support" will be a sharp decline in Kangpeng Technology's pharmaceutical and chemical business.
Duchuang Technology was established in January 2015, with the initial investors Wang Lei and Wang Qiuping; in October 2018, Wang Qiuping transferred his Duchuang Technology equity to Wang Lei and Xu Zhi respectively. Among them, Xu Zhi held 9.9% of Duchuang Technology's equity with 500,000 yuan subscribed funds.
, Xu Zhi was originally a staff member of Kangpeng Technology. He resigned in March 2018 and joined Duchuang Technology. In other words, the former employee has brought large orders with a total revenue of more than 5% to the "old boss" in one year. The business formation time between the two parties seems to be difficult to explain by coincidence, and the authenticity of business transactions also needs to be explained.
Inventory and accounts receivable have risen year by year
From the previous article, we can see that both traditional business display materials and new energy battery materials and electronic chemicals have experienced product prices falling year by year, which has also led to the book value of Kangpeng Technology's inventory increasing year by year.
From the end of 2019 to the end of 2021, Kangpeng Technology's inventory balance was 241 million yuan, 253 million yuan and 371 million yuan, respectively, increasing year by year. The company's inventory is mainly composed of inventory goods, semi-finished products, in-products and raw materials.
. In terms of inventory turnover rate, Kangpeng Technology is also at a relatively low level. During the reporting period, Kangpeng Technology's inventory turnover rates were 1.73, 1.47, and 2.11 respectively; the average inventory turnover rates of comparable companies in the same industry during the same period were 3.98, 4.15, and 5.10 respectively, all higher than Kangpeng Technology.
According to the author's inquiry, during the reporting period, the impairment losses of Kangpeng Technology's assets were RMB 336,500, RMB 3.9839 million and RMB 9.3614 million, respectively, all of which were inventory depreciation losses.
Kangpeng Technology pointed out that as the company's business scale gradually grows, the company's inventory amount may further increase. If subsequent market and customer demand changes, or product market prices decline and raw material costs continue to rise, the net realizable inventory value will be less than the book value, thereby making up inventory impairment provisions, which will have a negative impact on the company's operating performance.
During the above period, while Kangpeng Technology's inventory grew, its accounts receivable were also increasing year by year. At the end of each period of the reporting period, the balance of accounts receivable of Kangpeng Technology was RMB 174 million, RMB 185 million and RMB 192 million, respectively, respectively, increasing year by year. The turnover rates of accounts receivable are 4.33, 3.50 and 5.32 respectively, and the average values of comparable companies in the industry are 4.51, 4.54 and 5.80, all higher than Kangpeng Technology.
It also admitted that with the expansion of the company's business scale, the scale of the company's accounts receivable will gradually expand. If the operating conditions of the company's customers are affected by the external macro environment, resulting in the inability to recover the accounts receivable on time or cannot be recovered, it will bring certain bad debt risks to the company.
Capital market insiders pointed out that Kangpeng Technology's accounts receivable and inventory are both large, which will bring bad debts and price drop risks to the company, and it is difficult to recover and cash in time, which can easily cause funds to be difficult to operate. Once funds are difficult to operate, it will have an adverse impact on Kangpeng Technology's operations. (Proofreading/Li Hangsen)
