Special note: after this stock issuance, it is planned to be listed on the gem, which has high investment risk. GEM companies have the characteristics of large investment in innovation, uncertainty about the success of the integration of new and old industries, still in the growth stage, high operation risk, unstable performance and high delisting risk. Investors are facing greater market risks. Investors should fully understand the investment risks of the gem and the risk factors disclosed by the company, and make investment decisions prudently.
Aoki Digital Technology Co., Ltd
(unit 001, No. 32, Donghai Street South, Fenghe Jiangbei Village, Haizhu District, Guangzhou)
Letter of intent for initial public offering and listing on GEM
Sponsor (lead underwriter)
(No. 268, Hudong Road, Fuzhou, Fujian)
Issuer statement
Any decision or opinion made by the CSRC and the exchange on this issuance does not indicate that they guarantee the authenticity, accuracy and completeness of the registration application documents and the information disclosed, nor do they indicate that they make substantive judgment or guarantee on the profitability, investment value of the issuer or the income of investors. Any statement to the contrary is a false statement.
According to the provisions of the securities law, the issuer shall be responsible for the changes in the operation and income of the issuer after the shares are issued according to law; Investors independently judge the investment value of the issuer, make investment decisions independently, and bear the investment risks caused by the changes in the operation and income of the issuer or the changes in the stock price after the shares are issued according to law. The issuer and all directors, supervisors and senior managers promise that the prospectus and other information disclosure materials are free from false records, misleading statements or major omissions, and bear corresponding legal liabilities.
The controlling shareholder and actual controller of the issuer promise that there are no false records, misleading statements or major omissions in this prospectus, and bear corresponding legal liabilities.
The person in charge of the company, the person in charge of accounting and the person in charge of the accounting institution shall ensure that the financial and accounting materials in the prospectus are true and complete.
The issuer and all directors, supervisors, senior managers, controlling shareholders, actual controllers, sponsors and underwriting securities companies promise to compensate investors for losses in securities issuance and trading due to false records, misleading statements or major omissions in the issuer’s prospectus and other information disclosure materials.
The sponsor and the securities service institution promise to compensate the investors for the losses caused to the investors due to the false records, misleading statements or major omissions in the documents prepared and issued for the issuer’s public offering.
Overview of this offering
Type of shares issued: RMB ordinary shares (A shares)
The number of shares issued this time is 16666667 shares (not involving the transfer of old shares and excluding the additional shares issued by exercising the over allotment option), accounting for 25% of the total share capital of the company after issuance
The par value of each share is RMB 1.00
The issue price per share is RMB []
Expected issue date: March 2, 2022
The total share capital after issuance is 6667 shares (excluding the additional shares issued by exercising the over allotment option)
Exchanges and sectors to be listed Shenzhen Stock Exchange gem sponsor (lead underwriter) China Industrial Securities Co.Ltd(601377)
Signing date of the prospectus: February 22, 2022
Tips on major issues
The company specially reminds investors that before making investment decisions, they must carefully read all the contents of the main body of this prospectus and pay special attention to the following major matters. 1、 Important commitments related to this offering and listing
The company and relevant responsible parties have made corresponding commitments in accordance with the requirements of the CSRC, the exchange and other regulatory authorities. For important commitments, see “v. commitments related to investor protection” in “section 10 investor protection” of this prospectus. 2、 Arrangement of profit distribution policy
See “II. Dividend distribution policy” and “III. distribution of accumulated profits before the completion of this offering” in “section 10 investor protection” of this prospectus for details of the distribution arrangement of accumulated profits before the issuance and the dividend distribution policy after the issuance and listing of the company. 3、 Special risk tips
Investors are requested to pay special attention to the following risks and carefully read the full text of “section IV Risk Factors” in this prospectus. (I) e-commerce platform dependence risk
China’s B2C e-commerce sales are mainly concentrated in tmall, jd.com and other large e-commerce platforms. The e-commerce platform has formulated daily operation rules for service providers settled in the platform service market. If the platform rules are changed and the company cannot quickly understand and learn the change rules and make appropriate adjustments, the company’s many years of operation experience will become invalid. At present, the platform provides data and service support for service providers. If the platform’s support for service providers decreases, it will have an adverse impact on the company’s business development.
In addition, as an irreplaceable key link in the value chain, e-commerce platform has strong bargaining power. If the platform improves the charging level of store operation and promotion, or carries out some service provider businesses by itself, it will reduce the company’s business and profit space, resulting in the decline of the company’s profitability.
(II) brand cooperation risk
E-commerce service providers obtain the recognition of the brand and the authorization of the official flagship store of the brand, which is the basis of their business development. If the company fails to meet the expectations of the brand in the future, or the brand adjusts its online sales strategy, resulting in the suspension of cooperation between the brand and the company or the termination of cooperation between some stores, it will have an adverse impact on the company’s business. In addition, the brand and the company usually sign a cooperation agreement on an annual basis. Even if both parties renew the contract, the brand also has the right to adjust the service rate, supply price and credit policy terms, and may make modifications unfavorable to the company. Due to the scale effect of e-commerce agent operation service, the growth rate of cost is smaller than that of sales. Therefore, with the increase of cooperation time between the company and the brand party and the increase of brand sales, both parties may negotiate to reduce the service rate. Whether the company can maintain a long-term and stable cooperative relationship with existing brands and continuously expand new cooperative brands in the future will affect the company’s sustainable profitability.
In the future, if the company ends its cooperation with major brands due to changes in the market environment or brand strategy, it may affect the company’s short-term profit realization. If the company ends its cooperation with the brand due to less than expected market expansion, it may have a certain impact on the company’s operation or reputation.
Solid Gold is one of the main brands of channel distribution and e-commerce channel retail business in 2020. Brand Licensing companies sells SolidGold brand products in Chinese mainland (including Wuxi Online Offline Communication Information Technology Co.Ltd(300959) channels and cross-border e-commerce channels), authorized for February 1, 2020 to February 20, 2023. As Jianhe international completed the acquisition of 100% equity of solid gold pet, LLC in December 2020, Jianhe international and the Company re signed a cooperation agreement in 2021, and the cooperation mode, authorization period and authorization scope changed. In August 2021, the company signed a termination agreement with Jianhe international to end all cooperation of solid gold brand.
In 2020, the company’s revenue from solid gold was 145.1156 million yuan, accounting for 22.37% of the company’s operating revenue; From January to June 2021, the company’s income from solid gold was 120.058 million yuan, accounting for 27.93% of the company’s current operating income.
In January 2021, compared with 2020, the impact of solid gold business on the company’s e-commerce sales and service revenue was -6968900 yuan, and the impact on the company’s gross profit and net profit attributable to the owner of the parent company were -8136800 yuan and -5640500 yuan respectively, including -714400 yuan and -5012900 yuan on the gross profit of channel distribution business and net profit attributable to the parent company respectively, The impact on the gross profit and net profit attributable to the parent company of e-commerce channel retail business is -992800 yuan and -627600 yuan respectively. 1. The data of the second half of 2021 is unaudited data.
(III) risk of intensified market competition
It is normal for some brands to authorize stores on different platforms or different stores on the same platform to operate with different service providers in the industry. The company has a competitive relationship with the service providers of other stores of the brand (referring to stores not operated by the company) and the service providers of other brands in the same industry (referring to brands not operated by the company). The e-commerce service industry has multiple leading service providers, and the difference in operating capacity does not constitute a significant entry barrier. The assessment cycle of the platform for service providers is relatively short. If the company cannot maintain its existing competitiveness, it may be replaced by competitors.
E-commerce service industry is an open industry, there are no strict industry barriers and regulations, the threshold is relatively low, and an open and transparent evaluation mechanism has not been formed in the industry, and there is a lack of assessment standards for quantifying the ability of e-commerce service providers. At present, the e-commerce service industry is booming, and a large number of small and medium-sized service providers are pouring into the market. With the growth of their business, it may have a certain impact on the head service providers.
In addition, the industry has not yet formed a standardized pricing standard, which does not rule out that companies in the same industry reduce the charging standard in order to strive for customer resources, resulting in further intensification of market competition. The decline of the overall charging standard of the industry will affect the bargaining power of the company, thus affecting the profitability. (IV) risks affected by the sales performance of the brand
At present, the company provides e-commerce sales services mainly in the mode of e-commerce agent operation, and the company’s revenue is usually linked to the actual sales of brands. Due to the company’s lack of direct control over the operation and commodity quality of cooperative brands, the company’s business performance is affected by the market reputation and quality assurance of cooperative brands. If a brand has product quality defects, poor supply chain management and market reputation damage due to its own business problems, it may lead to the decline of the sales scale of the brand’s goods and affect the company’s service fee income.
H & M is one of the main cooperation brands of the company. During the reporting period, the revenue of each period was 16.3172 million yuan, 32.5371 million yuan, 44.806 million yuan and 15.4839 million yuan, accounting for 5.34%, 9.01%, 6.80% and 3.60% of the company’s main business revenue. The main cooperation modes include e-commerce agent operation, technical solutions and consumer operation services. On March 24, 2021, the media widely reported “H & M group’s statement on due diligence”. On the same day, Taobao and tmall platforms were unable to search “HM official flagship store”, and their products could not be sold normally through the above platforms.
The technical solutions and consumer operation service business between the company and H & M brand are still normal, and the e-commerce agent operation business is greatly affected. Assuming that the company did not cooperate with H & M Brand in the reporting period (excluding business income, costs and expenses in each period), the impact on the net profit attributable to the owner of the parent company in each period of the reporting period was -6.7532 million yuan, – 14.1764 million yuan, – 20.483 million yuan and -7.3128 million yuan respectively. The impact of the decline of H & M brand business income on the company was relatively limited. (V) technological innovation risk
The company has developed “Aoki OMS”, “Aoki Xiaobai”, “data mill” and other systems to achieve the goal of automation and intelligence of e-commerce sales service. During the reporting period, the R & D investment of the company was 14.089 million yuan, 23.3262 million yuan, 39.2346 million yuan and 20.3254 million yuan respectively, accounting for 4.61%, 6.46%, 6.05% and 4.73% of the current operating revenue respectively.
As an emerging retail model, e-commerce needs rapid changes in user needs and frequent business model innovation, which requires continuous technological innovation and product iterative development. If the company cannot accurately grasp the technology, industry and market trends and develop new products in line with the operation mode of e-commerce industry in the future, it will affect the quality of e-commerce sales services provided by the company and the upgrading of the company’s service ability driven by data and technology. 4、 Main financial information and operating conditions after the audit deadline of the financial report
The deadline for the audit of the issuer’s financial report is June 30, 2021. The reviewed main financial data of the company in 2021 are as follows: (I) main financial data of the consolidated balance sheet
Unit: 10000 yuan
Change range of the project from December 31, 2021 to December 31, 2020
Total assets 60240.87 37611.48 60.17%
Total liabilities 16446.44 9312.01 76.62%
Total shareholders’ equity attributable to the parent company 42816.74 27919.33 53.36%
Total shareholders’ equity 43794.43 28299.46 54.75%
Compared with the end of 2020, the total assets and liabilities of the company as of December 31, 2021 have increased. Among them, the increase of total assets comes from many factors, including the increase of monetary capital and accounts receivable brought by the company’s profit accumulation in 2021, and the advance payment brought by the expansion of the scale of channel distribution and e-commerce channel retail business
The increase of, the right to use assets recognized in accordance with the new lease standards, etc. The increase in total liabilities was mainly due to short-term borrowings
Increase in lease payments and implementation of new lease guidelines
