Source: China Economic Network
China Economic Network Editor's Note : On August 13, Zuming Bean Products Co., Ltd. (hereinafter referred to as "Zuming Co., Ltd.") was held at the first launch. Zuming Co., Ltd. plans to be listed on the Shenzhen Stock Exchange SME Board, and plans to issue no more than 31.2 million new shares, and the proportion of the issuance of the total share capital after issuance is not less than 25.00%. The sponsor is a venture capital bank. Zuming Co., Ltd. plans to raise 427 million yuan this time, which will be used for the technical transformation project of the fresh soy products production line of 80,000 tons per year and the soy products R&D and testing center upgrade project.
According to China Business News, this is the third time that Zuming Co., Ltd. has impacted the A-share market. As early as 2013, the Zhejiang Provincial Environmental Protection Department stated that Zuming Co., Ltd. entered the public announcement stage of environmental protection verification on the listing, but the plan to sprint IPO was unsuccessful at that time. Subsequently, Zuming Co., Ltd. officially listed New Third Board on March 22, 2016, becoming the first soybean products stock on the New Third Board at that time. It was terminated from March 14, 2019 and moved to A-shares. On July 5, 2019, the official website of the China Securities Regulatory Commission disclosed the prospectus of Zuming Co., Ltd., which failed to hit A-shares for the second time. On July 8, 2020, Zuming Co., Ltd. disclosed its prospectus again and began its third A-share listing.
According to the prospectus, from 2016 to 2019, Zuming Co., Ltd.'s operating income was RMB 850 million, RMB 863 million, RMB 939 million and RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, and RMB 1.048 billion, respectively.
From 2016 to 2019, the net profit attributable to the company's shareholders of Zuming Co., Ltd. was RMB 37.0281 million, RMB 41.4887 million, RMB 63.9418 million, and RMB 90.1651 million, respectively; the net cash flow generated by operating activities was RMB 77.0624 million, RMB 71.9160 million, RMB 133 million, and RMB 189 million, respectively.
From 2016 to 2019, the balance of accounts receivable of Zuming Co., Ltd. was RMB 74.3324 million, RMB 105 million, RMB 114 million and RMB 111 million, respectively, and the net accounts receivable were RMB 70.3027 million, RMB 99.3271 million, RMB 108 million and RMB 104 million, respectively. The proportion of the net accounts receivable to current assets at the end of the period was 20.27%, 30.19%, 34.39%, and 33.87%, respectively.
Zu Ming Co., Ltd.'s accounts receivable turnover rate showed a downward trend and was lower than the average level of the peer. From 2016 to 2019, the accounts receivable turnover rates of Zuming Co., Ltd. were 11.81 times, 9.63 times, 8.60 times and 9.34 times, respectively. The average accounts receivable turnover rates of comparable listed companies in the same industry were 20.22 times, 15.33 times, 15.94 times and 18.05 times, respectively.
From the end of 2016 to the end of 2019, Zuming Co., Ltd.'s inventory amounts were RMB 46.9568 million, RMB 54.7173 million, RMB 74.5811 million and RMB 64.3349 million, respectively, and the inventory accounts for 8.20%, 9.65%, 12.71%, and 10.15% of the operating costs, respectively.
From 2016 to 2019, the inventory turnover rate of Zuming Co., Ltd. was 12.31 times, 11.02 times, 8.94 times and 8.95 times, respectively, showing a downward trend. The average inventory turnover rate of comparable listed companies is 8.33 times, 7.06 times, 6.73 times and 6.40 times, respectively.
From the end of 2016 to the end of 2019, Zuming Shares' total liabilities were RMB 550 million, RMB 560 million, RMB 595 million and RMB 519 million, respectively. Among them, short-term loans were RMB 419 million, RMB 245 million, RMB 238 million and RMB 175 million respectively.
Judging from the debt repayment ability indicator, Zuming Co., Ltd. has a far cry from its peer companies.
From the end of 2016 to the end of 2019, the current ratios of Zuming Co., Ltd. were 0.65 times, 0.88 times, 0.62 times, and 0.89 times, respectively. The average current ratios of comparable listed companies in the same industry were 2.80 times, 2.80 times, 3.19 times and 3.85 times, respectively.
From the end of 2016 to the end of 2019, the quick ratios of Zuming Co., Ltd. were 0.56 times, 0.74 times, 0.48 times and 0.70 times respectively. The average quick ratios of comparable listed companies in the same industry were 2.43 times, 2.37 times, 2.84 times and 3.29 times respectively.
Zuming Co., Ltd.'s debt-to-asset ratio is significantly higher than the average level of peers. As of the end of 2016 to the end of 2019, Zuming Co., Ltd.'s debt-to-asset ratio (merger) was 60.76%, 59.96%, 58.40% and 50.72% respectively. The average debt-to-asset ratios of comparable listed companies are 31.33%, 28.45%, 28.28% and 26.42% respectively.
Zu Ming Co., Ltd.'s main business gross profit margin is growing year by year. From 2016 to 2019, the gross profit margins of Zuming Co., Ltd.'s main business were 32.63%, 33.98%, 37.32%, and 39.53%, respectively.
According to the Securities Market Red Weekly, in 2017 and 2018, Zuming Co., Ltd. purchased 2.16 billion yuan and 135 million yuan from the top five suppliers, accounting for 39.04% and 32.01% of the total purchases respectively. It is estimated that its total purchases in 2017 and 2018 were 411 million yuan and 422 million yuan. If the impact of the value-added tax rate of 17%, the total tax-inclusive procurement in the past two years was approximately 480 million yuan and 494 million yuan.
In the cash flow statements in 2017 and 2018, the company's "cash paid by purchasing goods and accepting services" was RMB 562 million and RMB 564 million. Excluding the impact of 71,900 yuan and -2.6975 million in the new advance payments that year, the cash expenditure related to procurement reached RMB 561 million and RMB 566 million respectively. By checking tax-inclusive procurement with cash expenditure, it can be found that in 2017 and 2018, cash expenditure was 81.0146 million yuan and 72.373 million yuan more than tax-inclusive procurement. In theory, this will lead to a corresponding reduction in the amount payable in that year.
In fact, the payables of Zuming Co., Ltd. in 2017 and 2018 were RMB 64.6016 million and RMB 81.4595 million, respectively, both of which increased instead of decreasing, an increase of RMB 5.2373 million and RMB 16.8579 million respectively compared with the end of the previous year. It is obvious that this new amount does not match the amount that should be reduced in theory, and there is a difference of 86.2519 million yuan and 89.2309 million yuan.
In 2017 and 2018, the sum of Zuming Co., Ltd.'s fixed assets, projects under construction and intangible assets was RMB 784 million and RMB 941 million, an increase of RMB 46.6038 million and RMB 156 million, respectively. The cash paid for the construction of fixed assets, intangible assets and other long-term assets during the same period was 84.7928 million yuan and 143 million yuan respectively. Theoretically, the amount payable in 2017 should be reduced by 38.189 million yuan, and the amount payable in 2018 should be increased by 12.9991 million yuan. But even considering the impact of this part of the data, there were still 48.0629 million yuan and 102 million yuan cash expenditures in 2017 and 2018 respectively.
In addition, the procurement data of Zuming Co., Ltd. is different in many places in the prospectus and the annual reports disclosed in the New Third Board period. For example, the prospectus shows that in 2016 and 2017, Zuming Co., Ltd. purchased 187 million yuan and 160 million yuan from the top five suppliers, while the relevant data in the annual reports of the same period were 213 million yuan and 185 million yuan respectively. In addition, there are many "different data for the same project" in the prospectus and previous annual reports, and these abnormalities make people doubt the authenticity of their financial data.
According to the public securities newspaper, the niece and son-in-law of the chairman of Zuming Co., Ltd. are his major clients. According to the company's information on the top five customers during the reporting period disclosed by the company, from 2016 to 2018, the transaction amounts between the company and the individual industrial and commercial owner Zheng Xuejun were RMB 17.9689 million, RMB 18.6605 million and RMB 19.9556 million, respectively. According to the 2015 annual report of Zuming Co., Ltd. on the New Third Board, Zheng Xuejun's transaction amount with the company in 2015 was 14.376 million yuan. According to the company's prospectus, Zheng Xuejun is the brother-in-law of Li Guoping, the company's director and senior management, and the son-in-law of Wang Chaying, one of the company's actual controllers.
In addition, at least 19 disputes over liability for motor vehicle accidents occurred in Zuming Co., Ltd. and its subsidiaries, causing at least 4 deaths.
On August 13, 2014, the first instance civil judgment of the first instance of the traffic accident liability dispute between Zuming Dou Products Co., Ltd. and Zhao Moumou, Shanghai Tianfeng Freight Transport Co., Ltd. and other motor vehicles ((2012) Hangzhou Minchu No. 429) disclosed by the China Judgment Document Network shows that at 10:28 on July 17, 2009, Yang Moumou drove a truck owned by Zuming Co., Ltd. through the Shanghai-Hangzhou Expressway to Hangzhou 154 kilometers + 296 meters to the direction of Hangzhou. The traffic police found that both parties were responsible for the same responsibility for the accident. The accident caused three people to die after the rescue was ineffective, and the second vehicle was damaged.
On April 18, 2016, the first instance civil judgment of the first instance of the motor vehicle traffic accident liability dispute between Chen Mou 1 and Chen Mou 2, Zuming Dou Products Co., Ltd. and Hangzhou Binjiang Branch of Hangzhou Binjiang Branch of China Pacific Property Insurance Co., Ltd. ((2014) Yongyu Minchu No. 66) revealed that when Chen Mou 4 was driving an ordinary two-wheeled motorcycle to the intersection of the four-branch road of avenue in Yuyao City, Zhou, the driver of Zuming Co., Ltd., drove the van of Zuming Co., Ltd. to knock Chen Weixin down, died on the spot, and the motorcycle was scrapped. The traffic police determined that both parties were responsible for the same responsibility for the accident.
China Economic Net reporter sent an interview letter to Zuming Co., Ltd. on related issues. Zuming Co., Ltd. replied that the company's IPO process and related information will be disclosed in accordance with the requirements of relevant departments, and the company's information can be learned through relevant platforms.
soy products manufacturer intends to list on the Shenzhen Stock Exchange
Zuming Co., Ltd.'s main business is the research and development, production and sales of soy products. The main products are fresh soy products, plant protein drinks, casual soy products, etc. Among them, fresh soy products mainly include: tofu, Qianzhang, vegetarian chicken, dried tofu, etc.; plant protein drinks mainly include: self-standing soy milk, Tetra Pak soy milk, etc.; leisure soy products mainly include: leisure soy milk, leisure bean rolls, casual vegetarian meat, etc.
The controlling shareholder of Zuming Co., Ltd. is Cai Zuming . Before this issuance, Cai Zuming directly held 30.0454 million shares of the company, accounting for 32.11% of the total share capital before this issuance. The actual controllers of Zuming Co., Ltd. are Cai Zuming, Wang Chaying and Cai Shuisai. As of the date of signing the prospectus, Cai Zuming, Wang Chaying and Cai Shuisai directly held 32.11%, 9.79% and 13.05% of the company's shares respectively, and controlled 18.86% of the company's shares by controlling Hangzhou Fiber (three people hold 67.70% of the company's shares). They actually controlled 73.80% of the company's equity in terms of equity relationship, and held an important management position of the company, which had a substantial and significant impact on the company's various business decisions (including but not limited to amending the company's articles of association, nominating director candidates, etc.).
Cai Zuming and Wang Chaying are husband and wife, and Cai Shuisa is the son of Cai Zuming and Wang Chaying. As of the date of signing the prospectus, the three people held a total of 54.94% of the company's equity.
Cai Zuming, male, born in May 1960, Chinese nationality, no permanent residence abroad. EMBA, member of the 10th Hangzhou Municipal CPPCC, representative of the 4th Hangzhou Binjiang District People's Congress, legal representative of the Zhejiang Green Agricultural Products Association, vice president of the China Soy Products Professional Committee, and vice president of the Zhejiang Democratic Progressive Party Entrepreneurs Association. He started self-employed in 1986 and founded Xiaoshan Huayuan Bean Products Factory in 1994, serving as the factory director; from February 2000 to November 2011, he served as the chairman and general manager of Huayuan Co., Ltd.; from February 2000 to November 2011, he served as the chairman and general manager of Hangzhou Fiber Products, and from Yangzhou Zuming to now.
Wang Chaying, female, born in October 1963, Chinese nationality, no permanent residence abroad. College degree, an outstanding entrepreneurial and innovative female entrepreneur in Hangzhou in 2008, and a "March 8th Red Flag Bearer" in Zhejiang Province. In 1994, he co-founded Xiaoshan Huayuan Bean Products Factory with Cai Zuming and served as deputy director; from February 2000 to November 2011, he served as deputy general manager and party branch secretary of Huayuan Co., Ltd.; from February 2000 to November 2011, he served as executive director and general manager of Anji Zuming, supervisor of Hangzhou Zuming, and supervisor of Hangzhou fiber products; from December 2011 to the present, he served as director, deputy general manager and party branch secretary of Zuming Co., Ltd.
Cai Shuisai, male, born in October 1986, Chinese nationality, no permanent residence abroad. With a master's degree, he served as assistant to the general manager of Huayuan Co., Ltd. from October 2010 to November 2011; from December 2011 to February 2017, he served as the director and assistant to the general manager of Zuming Co., Ltd.; from June 2011 to February 2017, he served as the general manager of Hangzhou Fiber Products; from June 2011 to February 2017, he served as the executive director of Hangzhou Zuming, director of Hangzhou Fiber Products, and supervisor of Anji Zuming; from March 2017 to the present, he served as the director and deputy general manager of Zuming Co., Ltd.
Zuming Co., Ltd. plans to be listed on the Shenzhen Stock Exchange SME Board, and plans to issue no more than 31.2 million new shares, and the issuance amount accounts for no less than 25.00% of the total share capital after issuance. The sponsor is a venture capital bank. Zuming Co., Ltd. plans to raise 427 million yuan this time, of which 362 million yuan will be used for the technical transformation project of the fresh soy products production line of 80,000 tons per year, and 65.2278 million yuan will be used for the soy products R&D and Testing Center upgrade project.
Three battles A-share
According to China Business News, Zuming Co., Ltd., which has three times impacted the A-share market, was once listed on the New Third Board.
As early as 2013, the Zhejiang Provincial Environmental Protection Department stated that Zuming Co., Ltd. entered the public announcement stage of environmental protection verification on the listing, but the sprint for the IPO plan was not successful at that time. It is understood that in addition to Zuming Co., Ltd., the production entities included in the environmental protection verification at that time also had a subsidiary of Anji Zuming, and another subsidiary, Hangzhou Zuming, was not included in the verification because it was engaged in sales business.
According to the prospectus in 2013, Zuming Co., Ltd. plans to raise a total of 280 million yuan, and will be invested in "technical transformation and expansion projects for the production line of 50,000 tons per year", "R&D and Testing Center Construction Project", and "Market Network Construction Project".
Subsequently, Zuming Co., Ltd. officially listed on the New Third Board on March 22, 2016, becoming the first soybean products stock on the New Third Board at that time. It was terminated from March 14, 2019 and moved to the A-share market.
On July 5, 2019, the official website of the China Securities Regulatory Commission disclosed the prospectus of Zuming Co., Ltd., which failed to hit A-shares for the second time. On July 8, 2020, Zuming Co., Ltd. disclosed its prospectus again and began its third A-share listing.
The reporter found through the three prospectuses that the purpose of Zuming Co., Ltd. raised funds this time is not much different from the previous few times, and is mainly concentrated on the construction of production lines and testing R&D projects.
prospectus shows that Zuming Co., Ltd. plans to issue no more than 31.2 million new shares this time, and the proportion of the total share capital after issuance shall not be less than 25%. The total amount of funds raised is expected to be 427 million yuan. Among them, 362 million yuan was invested in the technical transformation project of the 80,000 tons of fresh soy products production line in Anji, Zhejiang; 65 million yuan was invested in the upgrade project of the soy products R&D and Testing Center.
From the delisting of the New Third Board to the third impact on the A-share market, Zuming Co., Ltd.'s capital path has not been smooth.
Operating income and net profit have increased year by year
From 2016 to 2019, Zuming Co., Ltd.'s operating income was RMB 850 million, RMB 863 million, RMB 939 million and RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, RMB 1.048 billion, respectively.
Accounts receivable turnover rate is lower than the average level of peers
2016, 2017, 2018 and 2019, the accounts receivable turnover rate of Zuming Co., Ltd. was 11.81 times, 9.63 times, 8.60 times and 9.34 times, respectively, showing a downward trend.
Zuming Co., Ltd. stated that the decline in accounts receivable turnover rate is mainly due to the increase in the income amount and proportion of supermarket customers' income year by year, and the account period of accounts receivable for supermarket customers is relatively long, resulting in an increase in the balance of accounts receivable at the end of the period.
Zu Ming Co., Ltd.'s accounts receivable turnover rate is lower than the average level of the peers. From 2016 to 2019, the average turnover rates of accounts receivable by comparable listed companies in the same industry were 20.22 times, 15.33 times, 15.94 times and 18.05 times respectively.
Zu Ming Co., Ltd. said that the accounts receivable turnover rate varies greatly between listed companies in the same industry. The main reason is that the accounts receivable turnover rate is mainly affected by factors such as sales channels, brand influence, specific sales policies and credit policies. The average value of companies in the same industry that mainly receive prepayments is less different from the accounts receivable turnover rate of Zuming Co., Ltd. Zuming Co., Ltd.'s accounts receivable turnover rate is close to that of companies in the same industry, China Food and VITASOY INT’L.
At the end of 2019, the inventory amount was 64.3349 million
Zuming Co., Ltd. stated that the inventory increased at the end of 2017 compared with the previous year, mainly due to the increase in the company's fermented bean curd product; the inventory in 2018 increased by 19.8639 million yuan compared with the previous year, mainly due to the company's fermented bean curd production line in 2018, and the production cycle of fermented bean curd was relatively long, which led to a significant increase in products at the end of 2018; as the company's operating scale expanded, the inventory of raw materials increased.
From 2016 to 2019, the inventory turnover rate of Zuming Co., Ltd. was 12.31 times, 11.02 times, 8.94 times and 8.95 times, respectively, showing a downward trend.
Zuming Co., Ltd. stated that the inventory turnover rate in 2016 and 2017 did not change much, and the inventory turnover rate in 2018 decreased compared with 2017, mainly because the company's fermented bean curd production line was put into production in 2018 and the fermented bean curd production cycle was relatively long, which caused a significant increase in products at the end of 2018, resulting in a decline in inventory turnover rate. The inventory turnover rate in 2019 has little change compared with 2018.
Zuming Co., Ltd.'s inventory turnover rate is higher than the average level of peers. From 2016 to 2019, the average inventory turnover rate of comparable listed companies was 8.33 times, 7.06 times, 6.73 times and 6.40 times, respectively.
Zuming Co., Ltd. said that the inventory turnover rate difference between listed companies in the same industry is large, and the main reason is that the inventory turnover rate is mainly affected by factors such as revenue scale, product production cycle, and inventory management methods. Zuming Co., Ltd.'s inventory turnover rate is generally within a comparable range in the same industry.
Weak debt repayment ability
From the end of 2016 to the end of 2019, Zuming Shares' total liabilities were RMB 550 million, RMB 560 million, RMB 595 million and RMB 519 million, respectively.
Among them, from the end of 2016 to the end of 2019, Zuming Co., Ltd.'s short-term loans were RMB 419 million, RMB 245 million, RMB 238 million and RMB 175 million respectively.
Zuming Co., Ltd. stated that during the reporting period, the company's short-term loans were bank loans. The company's short-term loans at the end of 2017 decreased by 174 million yuan compared with the end of 2016. The main reason was that the issuer adjusted the debt structure and increased the proportion of long-term loans. The long-term loans at the end of 2017 increased by 173 million yuan compared with the end of 2016, and the short-term loans at the end of the period decreased accordingly. The company's short-term loans decreased by 7 million yuan at the end of 2018 compared with the end of 2017. The main reason was that the issuer adjusted the debt structure and increased long-term loans (including long-term loans due within one year) by 20.4167 million yuan, reducing short-term loans. The company's short-term loans decreased by 62.7514 million yuan at the end of 2019 compared with the end of 2018. The main reason was that the issuer returned the maturing short-term loans and reduced short-term loans.
Zu Ming Co., Ltd. said that the company's current ratio and quick ratio are lower than the average level in the same industry, mainly due to the expansion of the company's production and operation scale and the different requirements for machinery and equipment production of different categories of products, the company's demand for the purchase of fixed assets during the reporting period is relatively high. Because the company's financing channels are relatively limited and the financing channels are single, the funds for expanding production and operation mainly come from short-term loans to banks, which makes the company's liquidity liabilities higher than the liquid assets in the same period, and the current ratio and quick ratio are less than 1, and are lower than the average level of the same industry.
In response to this, Zuming Co., Ltd. stated that the company's debt-to-asset ratio is higher than the level of the same industry, mainly because the company has fewer financing channels and a relatively single financing method. As the company's initial public offering and listing is successful, the company's financing channels will be broadened, the capital scale and net asset scale will be further expanded, and the debt repayment ability will be further enhanced.
The gross profit margin of the main products is lower than the average level of peers
Zuming Co., Ltd.'s main business gross profit margin has been increasing year by year. From 2016 to 2019, the gross profit margins of Zuming Co., Ltd.'s main business were 32.63%, 33.98%, 37.32%, and 39.53%, respectively. Zuming Co., Ltd. said that due to the high sales proportion of fresh soy products and plant protein drinks, their gross profit margin is the main factor affecting the overall gross profit margin.
Fresh soy products and plant protein beverages are the main sources of the company's revenue and gross profit. In 2017, 2018 and 2019, its sales revenue accounted for 84.55%, 82.80% and 80.07% of the main business revenue, respectively. The total gross profit of fresh soy products and plant protein beverages accounted for 91.11%, 89.68% and 87.00% respectively.
Zu Ming Co., Ltd.'s main products, fresh soy products and plant protein drinks, have lower gross profit margins than the average level of peers.
From 2017 to 2019, the gross profit margins of fresh soy products of Zuming Co., Ltd. were 35.43%, 40.10% and 43.44% respectively, and the average gross profit margins of similar products or similar products of comparable companies were 41.68%, 42.35% and 44.17% respectively.
From 2017 to 2019, the gross profit margins of plant protein beverages of Zuming Co., Ltd. were 39.17%, 41.26%, and 41.36%, respectively, and the average gross profit margins of similar products of comparable companies were 48.38%, 50.37%, and 50.72%, respectively.
Zuming Co., Ltd. stated that compared with the gross profit margin of plant protein beverages of listed companies in the same industry, the gross profit margin of plant protein beverages is slightly lower than that of comparable companies in the same industry. The main reason is that the plant protein beverages in the same industry are well-known in the market and have high brand value. Drinks in companies in the same industry have been sold to the national market. In addition to being sold to China, vitamins are also sold to Australia, New Zealand, , Singapore, and other regions. Zuming Co., Ltd.'s plant protein drinks are mainly sold to Zhejiang Province, Jiangsu Province and Shanghai, with regional differences. Compared with companies in the same industry, Zuming Co., Ltd. has a lower market competitiveness and therefore has a lower gross profit margin.In terms of sales scale, the sales scale of companies in the same industry is far greater than that of Zuming Co., Ltd., with the annual sales revenue of Vita dairy food and beverage products reaching 4 billion yuan, and the annual sales revenue of beverage products of Chengde Lulu, Yangyuan Beverage and Dali Food reaching more than 4 billion yuan, 2 billion yuan and 7 billion yuan respectively. The annual sales revenue of Zuming Co., Ltd.'s plant protein beverages is only about 200 million yuan. The production and sales scale of Zuming Co., Ltd.'s plant protein beverages is much smaller than that of companies in the same industry, resulting in a large cost of sharing a unit of products and a relatively low gross profit margin.
019 R&D expenses were RMB 5.0238 million
From 2016 to 2019, the R&D expenses of Zuming Co., Ltd. were RMB 2.5095 million, RMB 2.4618 million, RMB 2.8164 million and RMB 5.0238 million respectively.
Zu Ming Co., Ltd. R&D expenses are mainly composed of employee compensation, depreciation expenses, material consumption and others. The year 2017 decreased slightly compared with the previous year, and was relatively stable. In 2018, it increased by 354,700 yuan compared with the previous year, mainly due to the increase in labor costs of R&D personnel. The R&D expenses in 2019 are called an increase of 2.2074 million yuan in 2018, mainly due to the increase in R&D investment in new product development and process optimization in 2019.
From 2016 to 2019, the R&D expense ratios of Zuming Co., Ltd. were 0.30%, 0.29%, 0.30% and 0.48% respectively.
financial data abnormal
But in fact, the payables of Zuming Co., Ltd. in 2017 and 2018 were RMB 64.6016 million and RMB 81.4595 million, respectively, both of which increased instead of decreasing, an increase of RMB 5.2373 million and RMB 16.8579 million respectively compared with the end of the previous year. It is obvious that this new amount does not match the amount that should be reduced in theory, and there is a difference of 86.2519 million yuan and 89.2309 million yuan.
In addition to the doubts about revenue data and procurement data, Zuming Co., Ltd.'s inventory data also puzzled the reporter of "Red Weekly". In the prospectus, Zuming Co., Ltd. disclosed a detailed list of procurement amounts for major raw materials, of which the total of soybeans, stand-alone bags, sugar and soybean oil from 2016 to 2018 was RMB 284 million, RMB 283 million and RMB 270 million, respectively. Generally speaking, in addition to the amount of raw materials purchased in that year, the remaining raw materials must be included in the inventory of that year.
Although Zuming Co., Ltd. did not disclose the detailed operating cost composition in the prospectus, a reporter from "Red Weekly" read its 2017 annual report when it was listed on the New Third Board and found that the company once said in its annual report that "soybeans, as the main raw material for the company's products, account for about 30% of the production cost." If calculated based on this proportion disclosed in the annual report, the cost of soybeans of Zuming Co., Ltd. in 2017 was about 91.0222 million yuan.
According to the raw material procurement list in the prospectus (see Table 3), the purchase amount of soybeans in 2017 was 204 million yuan. The difference between the soybean purchase amount and the consumption of soybeans in operating costs is 113 million yuan, that is, in the inventory in 2017, at least 113 million yuan should be added soybean raw materials (soybeans are a type of soybeans. In actual operations, the proportion of soybeans in operating costs may be slightly less than 30%, so the new inventory of soybean raw materials will be larger). But in fact, the book value of all inventory disclosed in 2017 was only 7.7605 million yuan, and the book value of the inventory was only 54.7173 million yuan in total, which means that it is impossible for a single soybean raw material to add 113 million yuan.
Annual report data of the prospectus "fighted". The financial director and other senior executives resigned
According to China.com, the prospectus for Zuming Co., Ltd. this IPO was compared with the annual report during its listing on the New Third Board, and found that there were inconsistent data such as procurement data and government subsidies.
Take procurement data as an example. The prospectus shows that in 2016 and 2017, Zuming Co., Ltd. purchased 187 million yuan and 160 million yuan from the top five suppliers, while the relevant data in the annual reports of the same period were 213 million yuan and 185 million yuan respectively. Specifically, in 2016 and 2017, Zuming Co., Ltd. purchased soybeans, white sugar, etc. from the largest supplier Yangzhou Yijiang Food Auxiliary Materials Co., Ltd., respectively, while the annual report of the same period was 55.9037 million yuan and 54.4076 million yuan respectively; the purchase amount of goods from the second largest supplier Zhejiang Best Printing Packaging Co., Ltd. was 43.3999 million yuan and 40.5915 million yuan respectively, while the annual report data was 50.4946 million yuan and 47.4834 million yuan respectively.
In terms of government subsidies, in the prospectus, the government subsidies included in the current profit and loss in 2016 and 2017 were RMB 16.0917 million and RMB 7.8610 million, respectively, while the data in the annual report was RMB 18.2967 million and RMB 9.8809 million, respectively.
Not only that, Zuming Co., Ltd.'s prospectus and annual report medium and short-term loan amounts, customer sales data, sales expenses, etc. are not in line with it. China Net Finance reporter noticed that the accounting firm , which disclosed its annual report during the listing of Zuming Co., Ltd., was Dahua Accounting Firm (Special General Partnership). The accounting firm for Zuming Co., Ltd.'s IPO this time was Tianjian Accounting Firm (Special General Partnership).
Zuming Food, which has different prospectus and annual report data, has changed many senior executives in recent years, including the financial director.
prospectus shows that on January 31, 2017, Huo Zhongdong resigned as financial director, and Zuming Co., Ltd. then hired Gao Feng as financial director; on April 7, 2018, Zhao Zhijun, deputy general manager in charge of fresh food sales, resigned; on May 2, 2018, Guo Can resigned as deputy general manager; on May 28, 2018, Liu Guoping resigned as director. In its prospectus, Zuming Co., Ltd. stated that the above resignation was all personal reasons.
It is worth noting that on the eve of listing on the New Third Board in 2016, the senior executives of Zuming Co., Ltd. also changed, including the financial director. On March 28, 2015, Wang Xiliang resigned from the position of company's financial director; on October 18, 2014, Qi Yajiang resigned from the position of deputy general manager of the company.
Some investment bankers once pointed out that the change in the financial director may mean that there are financial problems in the company.
product sales have not left the "free shipping area"
According to the Investors Network, the prospectus shows that Zuming Co., Ltd. is headquartered in Hangzhou, Zhejiang, and was founded by Cai Zuming and Wang Chaying. With his son Cai Shuisai, the three of them hold a total of 73.8% of the shares through direct and indirect means, which is a typical family business.
Since its establishment in 2000, Zuming Co., Ltd. has focused on the research, development, production and sales of soy products. Its products include more than 400 types of fresh soy products, plant protein drinks and casual soy products, mainly sold through distribution, direct sales and supermarket channels.
In terms of performance, during the reporting period, the company's operating income was RMB 863 million, RMB 939 million and RMB 1.048 billion, and the net profit attributable to shareholders was RMB 41.49 million, RMB 63.94 million and RMB 90.17 million, respectively. Although its revenue has exceeded 1 billion yuan, Zuming Co., Ltd.'s product sales radius has not yet left the "free shipping area". The Jiangsu, Zhejiang and Shanghai regions contribute more than 95% of the sales rate to the company, with a concentrated sales area and a market close to saturation.
The purpose of Zuming Co., Ltd.'s IPO raised mainly to technically transform the production line of the Zhejiang Anji factory. So, when the sales of soy products are limited by the sales radius, how should the new production capacity be digested?
Regarding this issue, Zuming Co., Ltd. told Investors Network that the company has signed an annual framework cooperation agreement to cooperate with Oushang , Carrefour , Yonghui Supermarket , Haidilao, Grandma's Home, Hema Fresh and other companies through signing an annual framework cooperation agreement, and gradually formed a sales network that has been deeply rooted in Jiangsu, Zhejiang and Shanghai and radiated to the whole country.
was punished for illegal acts many times
On July 12, 2017, Yangzhou Zumingdou Food Co., Ltd. failed to inform the workers of the real situation of the occupational disease hazards, failed to organize occupational health inspections in accordance with regulations, did not provide labor protection supplies for practitioners, did not set up obvious warning signs on places and equipment facilities with major risk factors, and less than regulations for practitioners training time, etc., Yangzhou Municipal Production Safety Supervision and Administration Bureau (now merged into "Yangzhou Emergency Management Bureau") imposed a fine of 69,500 yuan. In response to the above-mentioned penalties, the company has made rectifications and paid a fine, and has obtained a certificate issued by the Yangzhou Emergency Management Bureau that does not constitute a major violation. The above-mentioned administrative penalties will not affect the company's normal production and operation.
On March 9, 2017, the Shanghai Pudong New District Market Supervision Administration issued the administrative penalty for Shanghai Zuming Bean Products Co., Ltd. No. 150201780018 to the Ninth Branch of Shanghai Zuming Bean Products Co., Ltd., with the reason for the penalty being that on December 22, 2016, law enforcement officers inspected the seat B1316 at No. 2000 Hunan Road, Pudong New District and found that an electronic scale used for trade settlement at the soy products sales booth operated by Shanghai Zuming Bean Products Co., Ltd., which was not identified. Due to the above matters, the Ninth Branch of Shanghai Zuming Bean Products Co., Ltd. was fined 500 yuan.
On April 8, 2018, the Yangzhou Transportation Management Office issued the administrative penalty for Yangjiao Road Filing No. [2018] 00105 to Yangzhou Zuming Bean Food Co., Ltd., with the reason for the punishment being that Yangzhou Zuming failed to participate in the annual inspection in accordance with regulations. Due to the above matters, Yangzhou Zuming was fined 1,000 yuan and ordered to correct it immediately. The case has been closed. The amount of the above matters is small and does not constitute a major administrative penalty.
In addition, Zuming Co., Ltd. has also been involved in trademark infringement litigation dispute. On November 16, 2018, Dianfa Food (Suzhou) Co., Ltd. (Plaintiff) sued Shang China (Qinghe District Zuming Bean Products Business Department, Defendant I) and Zuming Bean Products Co., Ltd. (Defendant II) for suspected infringement of trademark rights disputes such as "Qianye Tofu", and asked the two defendants to immediately stop producing and selling infringing products, and jointly compensate the plaintiff for economic losses of RMB 1 million.
On November 20, 2019, National Intellectual Property Office issued a "Notice of Defense for Trademark Review and Review Cases" to the company, informing the company that Dianfa Food (Suzhou) Co., Ltd. (the applicant) made an invalid declaration request for the trademark "Zu Ming Qianye Tofu" No. 23200665, and the bureau accepted it in accordance with the law. As of the date of signing the prospectus, the above-mentioned trademark review cases are still in the review process.
frequently complained by consumers for quality problems
According to Shandong Business Daily , recently, the media revealed that the tofu skin produced by it contains exogenous gene fragments, which is suspected to be a genetically modified soy product. A relevant person in charge of Zuming Co., Ltd. responded to a reporter from Shandong Business Daily that the product involved has been sent to a third-party agency for testing, and no genetically modified ingredients have been detected.
Related news reports said that 80g tofu skin produced in the Anji factory of Zuming Co., Ltd. was found to contain three exogenous gene fragments pCaMV35S, tNOS, and CP4-EPSPS in recent tests, which are suspected to be genetically modified foods.
Shandong Business Daily reporter called Zuming Co., Ltd. about this matter. The relevant person in charge said: "The company has conducted active self-inspection and sent the relevant products and raw materials to a third-party agency for re-testing. The results show that the product has not detected the genetically modified ingredients. For details, please refer to the relevant inspection report." The inspection report provided by
Zuming Co., Ltd. shows that the testing report was issued by Shanghai Tianxiang Quality Technology Service Company. The relevant products do not contain pCaMV35S, tNOS, and CP4-EPSPS exogenous gene fragments, and are not genetically modified foods.
In addition, Zuming Co., Ltd. has frequently been complained by consumers for food safety issues.
According to media reports, some consumers purchased "Zu Ming" brand dried beans, and the taste marked in the packaging bag does not match the actual product. In addition, on major interactive platforms, some consumers complained about the problem of eating maggots from Zuming Dried Tofu, hair in the food, hair in the sealed mouth of the packaging bag, and moldy during the shelf life of the food.
017 employee proportion of employees who did not pay housing provident fund in 2017 was as high as 60.23%
According to Hexun.com, the prospectus shows that during the reporting period, the company did not pay social insurance premiums and housing provident fund for some employees. At the end of each reporting period, the proportion of employees who should pay social insurance premiums but have not paid to all employees of the company was 0.16%, 0.41%, and 0.00% respectively; the proportion of employees who should pay housing provident fund but have not paid to all employees of the company was 60.23%, 51.85%, and 21.33%. The company faces the risk of paying social insurance premiums and housing provident fund. There is obvious non-compliance in the company's governance.
Chairman's wife, niece and son-in-law, are big customers
According to the public Securities News, according to the equity structure of Zuming Co., Ltd., the company is a family-owned enterprise.Among them, Cai Zuming, Cai Shuisai and Wang Chaying directly hold 32.11%, 9.79% and 13.05% of the shares respectively, and controls 18.86% of the company's shares by controlling Hangzhou Fiber (the three people hold 67.70% of the shares of Hangzhou Fiber), and actually controls 73.80% of the company's equity in terms of equity relations. Among them, Cai Zuming is the chairman, Cai Zuming and Wang Chaying are husband and wife, and Cai Shuisa is father and son.
In addition, from the perspective of the equity structure of Hangzhou Fiber Investment Co., Ltd., the shareholders are Cai Zuming, Wang Chaying, Cai Shuisai, Gao Feng, Cai Xiaofang, Li Guoping, Qian Guojian, Zhao Dayong, Wu Xiaoliu, Yang Guofeng and Li Jianfang. Among them, Cai Xiaofang is the daughter of Cai Zuming and Wang Chaying, and holds 8.43% of the shares of Hangzhou Feipin; Li Guoping and Li Jianfang are siblings, and they are Wang Chaying's nephew and niece, respectively, and holds 4.49% and 1.40% of the shares of Hangzhou Feipin; at the same time, Li Guoping and Li Jianfang also directly hold 0.44% and 0.05% of the shares of Zuming Shares respectively. This also means that the Cai Zuming family holds a total of 76.99% of Zuming shares.
From the perspective of business transactions, Zuming Co., Ltd. is also rich and does not flow to outsiders. According to the company's information on the top five customers during the reporting period disclosed by the company, from 2016 to 2018, the transaction amounts between the company and the individual industrial and commercial owner Zheng Xuejun were RMB 17.9689 million, RMB 18.6605 million and RMB 19.9556 million, respectively. According to the 2015 annual report of Zuming Co., Ltd. on the New Third Board, Zheng Xuejun's transaction amount with the company in 2015 was 14.376 million yuan. According to the company's prospectus, Zheng Xuejun is the brother-in-law of Li Guoping, the company's director and senior management, and the son-in-law of Wang Chaying, one of the company's actual controllers. The volume of related transactions continued to expand during the reporting period.
Frequently trapped in motor vehicle traffic accident liability disputes, resulting in 4 deaths
According to Jin Zhengyan, as of October 15, 2019, there were 30 documents involving Zuming Co., Ltd.’s traffic accidents, 7 documents involving Zuming Co., Ltd.’s predecessor Hangzhou Huayuan Bean Products Co., Ltd.’s ; 2 documents involving Zuming Co., Ltd.’s subsidiary Anji Zuming Co., Ltd.’s subsidiary; 5 documents involving traffic accidents involving Zuming Co., Ltd.’s subsidiary Yangzhou Zuming Dou Food Co., Ltd.’s subsidiary.
According to a query by China Economic Net reporter, from 2016 to the present, Zuming Co., Ltd. and its subsidiaries have at least 19 disputes on responsibility for motor vehicle traffic accidents.
Judgment Document Network shows that the dispute over the responsibility for motor vehicle traffic accidents related to Zuming Co., Ltd. caused at least 4 deaths.
