About Kingsemi Co.Ltd(688037)
Issue A-Shares to specific objects
Reply report on the implementation letter of feedback on the issuance and registration process
Sponsor (lead underwriter)
27th floor and 28th floor, building 2, international trade building, No. 1, Jianguomenwai street, Chaoyang District, Beijing
China Securities Regulatory Commission and Shanghai Stock Exchange:
The implementation letter of feedback on issuance and registration issued by Shanghai Stock Exchange on January 27, 2022 has been received. Kingsemi Co.Ltd(688037) (hereinafter referred to as the "issuer", "applicant" and "company") and China International Capital Corporation Limited(601995) (hereinafter referred to as the "sponsor") and Guohao law firm (Shanghai) (hereinafter referred to as the "applicant's lawyer") have carefully studied the issues raised in the implementation letter of feedback on the issuance and registration process, and now explain them one by one for review.
Unless otherwise specified, the abbreviation used in this reply is the same as the interpretation in the prospectus for the issuance of A-Shares to specific objects in Kingsemi Co.Ltd(688037) 2021. In this reply, if there is any difference in the mantissa between the total and the sum of the sub item values, it is caused by rounding.
Issues listed in the implementation letter of feedback on the issuance and registration process are in bold
Reply to the questions listed in the implementation letter of feedback on the issuance and registration process
Amendments and supplements to the prospectus (BOLD)
catalogue
Question 1: 4 question 2: 8 question 3: thirteen
According to the registration documents, as of September 30, 2021, the issuer has accumulated 76.6 million yuan of over raised funds for permanent replenishment, and plans to gradually use the remaining over raised funds for permanent replenishment in the future. The issuer is requested to supplement the specific use plan of the over raised funds in the future, and explain the early use of the over raised funds and whether the future use plan complies with the relevant provisions of Shanghai Stock Exchange on the use of the over raised funds. The recommendation institution is requested to express clear verification opinions and explain the verification means.
reply:
1、 Issuer description
(I) specific use plan of over raised funds in the future
With the approval of the approval on the registration of Kingsemi Co.Ltd(688037) initial public offering (zjxk [2019] No. 2335) of the CSRC, the company publicly issued 21 million RMB common shares (A shares) on December 10, 2019, with a total amount of 566.37 million yuan. After deducting the issuance fee of 60.6259 million yuan, the actual net amount of funds raised was 505.7441 million yuan, Among them, the amount of projects planned to be invested in IPO is 377.7897 million yuan, and the amount of over raised funds is 127.9544 million yuan.
In order to improve the use efficiency of the raised funds, the company used part of the over raised funds to permanently supplement the working capital during the reporting period. As of September 30, 2021, the company had used the over raised funds to permanently supplement the working capital of 76.6 million yuan.
During the reporting period, the company's operating income was 209.9905 million yuan, 213.1567 million yuan, 328.9002 million yuan and 547.1869 million yuan respectively. With the improvement of business scale, the company needs to ensure working capital suitable for business scale to meet daily operation. On the premise of ensuring the normal progress of the previous raised and invested projects, in order to meet the company's working capital needs, improve the use efficiency of raised funds, reduce financial costs, further improve the company's profitability and safeguard the interests of listed companies and shareholders, the company plans to gradually use the remaining over raised funds of 51.3544 million yuan for permanent replenishment of working capital in the future, The accumulated use amount within each 12 months will not exceed 30% of the total amount of over raised funds, which will be mainly used for daily production and operation activities.
The calculation of the issuer's capital gap in the next three years is based on the following main assumptions:
(1) There have been no major adverse changes in the macroeconomic environment and market conditions.
(2) In 2020, the growth rate of the company's operating revenue is 54.30%, assuming the company's operating revenue in the next three years
Since 2020, with the continuation of the lack of core situation, Chinese wafer factories have been expanding, and the demand of downstream manufacturers for gluing development and single-chip wet equipment has been expanding, which has changed greatly from the market situation in the first two years of the reporting period. Since 2020, the company's revenue in the fields of integrated circuit front wafer processing, rear advanced packaging, compounds, MEMS, LED chip manufacturing and so on has increased significantly, and the sales orders have increased significantly. It is expected that the revenue growth rate will remain at a high level in the future. From January to September 2021, the company's operating revenue reached 547186900 yuan, a year-on-year increase of 158.20%, which has exceeded the annual level in 2020. According to the announcement on the advance increase of annual performance in 2021 disclosed by the company on January 25, 2022, according to the preliminary calculation of the financial department, it is estimated that the operating revenue in 2021 will reach 810 million yuan to 840 million yuan, an increase of 48.10998 million yuan to 51.10998 million yuan compared with the same period of last year (statutory disclosure data), a year-on-year increase of 146.28% to 155.40%. Therefore, it is prudent and reasonable to assume that the company will maintain an operating revenue growth rate of 54.30% in 2020 in the next three years.
(3) It is assumed that the issuer's working capital demand in the next three years is equal to the part where the operating current liabilities are lower than the operating current assets.
Combined with the above main assumptions, the sales percentage method is used to calculate the changes of relevant operating current assets and operating current liabilities caused by the growth of future operating revenue, and then it is estimated that the working capital gap of the company from 2021 to 2023 is about 543348800 yuan. The specific calculation is as follows:
Unit: 10000 yuan
Annual 2020 2021 forecast 2022 forecast 2023 forecast amount proportion
Operating income 32890.02 100.00% 50749.22 78305.93 120825.86
Operating current assets 55416.80 168.49% 85507.99 131938.62 203580.98
Operating current liabilities 35094.31 106.70% 54150.44 83553.99 128923.61
Occupation of working capital 20322.49 31357.55 48384.63 74657.37
Funding gap in the next three years
(estimated occupation of working capital of 54334.88 at the end of 2023 - occupation of working capital at the end of 2020)
As of September 30, 2021, the company's monetary capital was 287.6397 million yuan, including 43.6136 million yuan of restricted monetary capital (mainly guarantee deposit, Bill deposit, etc.), and 117.4146 million yuan of monetary capital needs to be invested in the previous raised investment project. Therefore, the company's actual discretionary monetary capital was 126.6115 million yuan, including 51.3544 million yuan of excess raised capital from IPO.
This issuance plans to use the raised funds to supplement the current flow of 300 million yuan, which is still far from the working capital demand of 543.3488 million yuan in the next three years calculated above. Therefore, it is reasonable and necessary for the company to gradually use the remaining over raised funds of 51.3544 million yuan to permanently supplement the working capital in the future. (II) whether the early use of the over raised funds and the future use plan comply with the relevant provisions of Shanghai Stock Exchange on the use of the over raised funds
In accordance with the guidelines for the supervision of listed companies No. 2 - regulatory requirements for the management and use of raised funds by listed companies (revised in 2022), the measures for the management of raised funds by listed companies of Shanghai Stock Exchange (revised in 2013), the self regulatory guidance for listed companies of Shanghai Stock exchange No. 1 - standardized operation and other relevant provisions, The part of the net amount of funds actually raised by the company that exceeds the planned amount of funds raised can be used to permanently supplement working capital or repay bank loans, but the cumulative amount used within each 12 months shall not exceed 30% of the total amount of funds raised, and it shall promise not to make high-risk investment or provide financial assistance to objects other than holding subsidiaries within 12 months after supplementing working capital. If the over raised funds are used for permanent replenishment of working capital or repayment of bank loans, they shall be deliberated and approved by the board of directors and the general meeting of shareholders of the company, and the online voting method shall be provided for shareholders. The independent directors, the board of supervisors, the recommendation institution or the independent financial adviser shall express their explicit consent.
The company held the 15th meeting of the first board of directors and the 7th Meeting of the first board of supervisors on April 24, 2020, and deliberated and adopted the proposal on using part of the over raised funds to permanently supplement working capital. On May 25, 2020, the company held the 2019 annual general meeting and deliberated and adopted the above proposal, It is agreed that the company will use part of the over raised funds of RMB 38.3 million to permanently supplement working capital. The company held the 26th meeting of the first board of directors and the 16th meeting of the first board of supervisors on June 11, 2021, deliberated and adopted the proposal on using part of the over raised funds to permanently supplement working capital. On June 28, 2021, the company held the third extraordinary general meeting of shareholders in 2021, deliberated and adopted the above proposal, It is agreed that the company will use part of the over raised funds of RMB 38.3 million to permanently supplement working capital. The above-mentioned use of over raised funds has been deliberated and approved by the board of directors and the general meeting of shareholders of the company, and online voting methods have been provided for shareholders. Independent directors, the board of supervisors and the sponsor Guosen Securities Co.Ltd(002736) of the company's initial public offering and listing have expressed clear consent. The company has fulfilled relevant decision-making procedures for the use of the above-mentioned over raised funds.
The total amount of funds raised by the company in the previous time was 566.37 million yuan, and the amount of over raised funds was 127.9544 million yuan. The above amounts used for permanent replenishment of working capital were 38.3 million yuan and 38.3 million yuan respectively, accounting for 29.93% and 29.93% of the total amount of over raised funds respectively. The cumulative amount of funds used in every 12 months did not exceed 30% of the total amount of over raised funds; When the company used the over raised funds to permanently supplement the working capital for the above two times, it has promised that it will only be used for the production and operation related to the main business, and will not make high-risk investment or provide external financial assistance within 12 months after the over raised funds permanently supplement the working capital. As of the date of issuance of this report, it has not violated the above commitments and complies with the relevant provisions on the use of over raised funds. The company plans to gradually use the remaining over raised funds of 51.3544 million yuan for permanent replenishment of working capital in the future, which will ensure that the cumulative use amount will not exceed 30% of the total over raised funds every 12 months, and will not make high-risk investment or provide external financial assistance within 12 months after the over raised funds permanently replenish working capital.
To sum up, the early use and future use plan of the company's over raised funds comply with the relevant provisions of Shanghai Stock Exchange on the use of over raised funds.
2、 Verification of the sponsor
(I) verification procedure
The recommendation institution has performed the following main verification procedures:
1. Obtain the bank account statement of the previous raised funds, bank receipts related to capital outflow and other bank account information;
2. The issuer has consulted the documents related to the use of the raised funds; 3. Obtain and consult the relevant instructions issued by the issuer to understand the use plan of the issuer's over raised funds; 4. Check the relevant financial subjects of the company to check whether there is high-risk investment or external financial assistance; 5. Consult the relevant regulations and Q & A of the regulatory authorities on the use of over raised funds, and compare and analyze whether the issuer's use of over raised funds is in compliance.
(II) verification opinions
After verification, the recommendation institution believes that:
1. In order to meet the company's future working capital needs, the issuer plans to gradually use the remaining over raised capital of 51.3544 million yuan for permanent replenishment of working capital in the future;
2. The early use and future use plan of the issuer's over raised funds comply with the relevant provisions of Shanghai Stock Exchange on the use of over raised funds.
According to the application materials, the raised investment projects include " Shanghai Lingang Holdings Co.Ltd(600848) R & D and industrialization project" and "industrialization project of high-end wafer processing equipment (phase II)". The applicant is requested to supplement: (1) whether the raised investment project complies with relevant national industrial policies; (2) Whether it is necessary to perform other procedures other than project approval and filing in relevant departments or meet other requirements of relevant departments.
The sponsor and the applicant's lawyer shall check and express clear opinions on whether it will affect the public offering. reply:
1、 Issuer description
(I) whether the raised investment project complies with relevant national industrial policies
1. The raised investment project meets the requirements of national industrial structure adjustment
The issuer's raised investment project " Shanghai Lingang Holdings Co.Ltd(600848) R & D and industrialization project" is mainly used to produce high-end semiconductor special equipment such as ARF lithography process gluing developer, immersion lithography process gluing developer and single-chip chemical cleaning machine, "high-end wafer processing equipment industrialization project (phase II)" is mainly used to produce front BARC (anti reflective layer) gluing machine, i-line gluing developer KrF gluing developing machine, rear channel advanced packaging bumping preparation process gluing developing machine and other high-end semiconductor special equipment. According to item 1.3.1 of the guidance catalogue for key products and services of strategic emerging industries (2016 Edition) published by the national development and Reform Commission and Article 20 of item 28 (Information Industry) of category I (encouraged) in the guidance catalogue for industrial structure adjustment (2019 Edition), the industry in which the raised investment is located belongs to the national strategic emerging industry, It meets the requirements of national industrial structure adjustment.
2. The industry in which the raised investment project is located belongs to the industry encouraged and supported by the state
In order to promote the development of semiconductor industry and enhance industrial innovation ability
