Gem investment risk tips
After this stock issue, 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. Hit Welding Industry Co., Ltd
(Yaoguan Town, Wujin District, Changzhou City)
Initial public offering and listing on GEM
Prospectus
Sponsor (lead underwriter)
(Building 4, No. 66 Anli Road, Chaoyang District, Beijing)
Important 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 there are no false records, misleading statements or major omissions in the prospectus and other information disclosure materials, 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 agency 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 is 454534 million, accounting for 25% of the total share capital after issuance. All of them are new shares, and the original shareholders do not offer shares to the public
The par value of each share is RMB 1.00
The issue price per share is 15.37 yuan
Issue date: March 10, 2022
The stock exchange to be listed is the growth enterprise market and the board of Shenzhen Stock Exchange
The total share capital after issuance is 181813400 shares
Sponsor (lead underwriter) China Securities Co.Ltd(601066)
Signing date of prospectus: March 16, 2022
Tips on major issues
The company reminds investors to carefully read the full text of this prospectus and pay special attention to the following important matters. 1、 Important commitments made by the issuer and related parties
The company reminds investors to carefully read the important commitments made by the company, shareholders, actual controllers, directors, supervisors, senior managers, other core personnel, as well as the sponsors and securities service institutions of this offering, as well as the binding measures for failure to fulfill the commitments, See “v. commitments related to investor protection” in “section 10 investor protection” of this prospectus for specific commitments. 2、 The distribution of accumulated profits before the issuance and the dividend distribution policy after the issuance and listing
According to the resolution of the sixth extraordinary general meeting of shareholders in 2020, the undistributed profits accumulated before the completion of the company’s initial public offering of shares shall be shared by the new and old shareholders after the completion of the offering according to the shareholding ratio after the offering. See “II. Dividend distribution policies and decision-making procedures after the issuance and the differences in dividend distribution policies before and after the issuance” in “section 10 investor protection” of this prospectus for the specific contents of the company’s dividend distribution policies after the issuance and listing. 3、 Special risk tips
The company specially reminds investors to pay attention to the following risk summary tips. For details, please read all the contents of “section IV Risk Factors” in this prospectus. (I) risk of scientific and technological innovation failing to meet expectations
In the face of fierce market competition, the company must continue to develop products with high added value for welding in different environments, connection of different new materials, but a new product often takes a long time from formula research, trial production, preparation process design to final customer recognition and large-scale production and sales, and may face the risk of product or technology development failure. In this process, the technology R & D risks faced by the company are also mainly reflected in: whether the company can correctly grasp the development trend of new technology and realize the products developed by the company at the advanced technical level; Whether we can implement effective management, grasp the development cycle and reduce the development cost in the process of technology development. If the company fails to correctly judge the trend of future technology and product development, and the R & D direction, resource investment and R & D personnel allocation can not meet the needs of the market for technology renewal, it may cause the company’s technology to lag behind the technical level of the industry, thus adversely affecting the development of the company. (II) market competition risk
The company is mainly engaged in the R & D, production and sales of fusion welding materials. The fusion welding material industry has the characteristics of multiple varieties and specifications. After years of development, the fusion welding materials industry is currently in a fully competitive situation. It cannot be ruled out that new competitors will enter the market in the future, or the original competitors will increase production capacity and intensify the market competition in the industry, resulting in a decline in the sales price and quantity of the issuer’s products, resulting in a decline in the gross profit margin of the products and an adverse impact on the profitability of the issuer. In addition, if the issuer fails to maintain its advantages in technology, management, scale, brand, product upgrading and process optimization, it will face greater market competition pressure in the future. (III) price fluctuation risk of raw materials
During the reporting period, the raw materials of the company’s main products accounted for more than 80% of the cost. Due to the high proportion of raw material cost in the company’s cost and frequent price fluctuations, it had a great impact on operating costs and profits. During the reporting period, the main raw materials purchased by the company have the attribute of bulk commodities, and there are open market prices. The company and suppliers form the final purchase price based on the spot transaction price of relevant bulk commodities and considering factors such as processing and transportation.
From January 1, 2018 to June 30, 2021, the market price fluctuation of bulk commodity wire rod is as follows: data source: wind
If the prices of main raw materials such as wire rods are greatly affected by factors such as changes in commodity prices in the future, it will have a certain impact on the gross profit margin of the company’s products, so the company faces the risk of price fluctuation of raw materials. (IV) risk of high concentration of suppliers
The raw material suppliers of the issuer are relatively concentrated, and the purchase amount of the top five suppliers accounted for more than 45% of the total purchase amount during the reporting period. The raw materials of the company are mainly wire rods produced by steel manufacturers such as Minmetals Yingkou, Citic Pacific Special Steel Group Co.Ltd(000708) , Jiangsu Shagang, etc. During the reporting period, the purchase proportion of major suppliers is relatively stable. However, if the existing suppliers of the issuer cannot guarantee the supply of raw materials to the issuer for various reasons, the issuer will face problems such as tight supply of raw materials in the short term, increased procurement costs and re establishment of procurement channels, which will have an adverse impact on the raw material procurement, production and operation and financial status of the issuer. (V) recovery risk of accounts receivable
At the end of each reporting period, the book value of the company’s accounts receivable was 196816100 yuan, 169218300 yuan, 2205127 million yuan and 275913 million yuan respectively, accounting for 20.82%, 16.05%, 16.17% and 20.18% of the total assets respectively. If the downstream customers fail to collect the payment on time, it may bring certain losses to the company. If the balance of the company’s accounts receivable increases significantly in the future, it will bring certain pressure to the company’s working capital. (VI) risks of macroeconomic changes and cyclical fluctuations in downstream industries
Since its establishment for more than 20 years, the company has been focusing on the R & D, production and sales of fusion welding materials. The fusion welding materials produced by the company are widely used in rail transit, petrochemical industry, nuclear power and hydropower, engineering machinery, container, ship and automobile manufacturing. However, due to the close linkage between the company and the development of the above downstream markets, it is greatly affected by macroeconomic changes and the cyclical fluctuations of downstream industries. If there are large fluctuations in the macro-economy in the future, the development speed of the above downstream industries will slow down, and the operation status of downstream manufacturers will decline, which may lead to the reduction of orders and difficulties in collecting payment for goods, and then affect the performance of the company. Therefore, the company has the risk of being affected by macroeconomic changes and cyclical fluctuations in downstream industries. 4、 Main financial information and operating conditions after the audit deadline of financial report (I) operating performance in 2021
The deadline for the audit of the company’s financial report is June 30, 2021. Zhonghui certified public accountants reviewed the consolidated and parent company’s balance sheet on December 31, 2021, the consolidated and parent company’s income statement from July to December, 2021 and 2021, the consolidated and parent company’s cash flow statement from July to December, 2021 and the notes to the financial statements, and issued the review report (Zhonghui kuaiy [2022] No. 0320). Zhonghui certified public accountants said: “according to our review, we have not noticed anything that makes us believe that the 2021 financial statements of Harbin Welding Institute Huatong company have not been prepared in accordance with the provisions of the accounting standards for business enterprises and have not been in all major aspects
Fairly reflect the consolidated and parent company’s financial position, operating results and cash flow of Harbin Welding Institute Huatong company. “
Main financial information and operating conditions reviewed (Unaudited) after the audit deadline of the company’s financial report
As follows: as of December 31, 2021, the total assets of the company were 1476794500 yuan, belonging to the parent company
The owner’s equity of the company’s shareholders is 622519700 yuan; The company’s operating revenue in 2021 was 1715578600
The net profit attributable to the shareholders of the parent company was 761474 million yuan.
(II) expected changes in operating performance from January to March 2022
After preliminary calculation, the company’s performance forecast and year-on-year changes from January to March 2022 are as follows:
Unit: 10000 yuan
Change proportion of the project from January to March 2022 to January to March 2021
Operating income 3646000 ~ 38745003361190 8.47% ~ 15.27%
Net profit 140000 ~ 170000180793 – 22.56% – 5.97%
Net profit after deducting non recurring loss of 140000 ~ 16 Konka Group Co.Ltd(000016) 2805 -14.01% ~ -1.72%
From January to March 2022, due to the repeated covid-19 pneumonia epidemic, the market price changes of the company’s main raw materials and other factors
As a result, the operating revenue is expected to increase compared with the same period last year, and the net profit is expected to decrease compared with the same period last year. above
The financial data from January to March 2022 are the preliminary accounting data of the company, which have not been audited or reviewed by accountants and do not constitute
Profit forecast.
During the period from the audit deadline of the financial report to the signing date of this prospectus, the company is in good operation and production
The business model has not changed; The management and core technical personnel of the company have remained stable, and there is no supervision of the company
Situations that have a significant adverse impact on management and R & D capability; No major changes have taken place in industrial policies and tax policies.
catalogue
Overview of this offering 3. Tips on major issues Section 1 interpretation 12 section II Overview sixteen
1、 Basic information of the issuer and the intermediary of this offering sixteen
2、 Overview of this offering sixteen
3、 Main financial data and financial indicators of the issuer during the reporting period eighteen
4、 The main business operation of the issuer V. issuer’s innovation, creation and creative features, scientific and technological innovation, model innovation, format innovation and new and old
Industrial Integration twenty
6、 Specific listing criteria selected by the issuer twenty-five
7、 Special arrangements for corporate governance of the issuer twenty-five
8、 Purpose of raised funds Section 3 overview of this offering twenty-seven
1、 Basic information of this offering twenty-seven
2、 Related to the issuance of the parties twenty-seven
3、 The relationship between the issuer and the intermediaries related to this offering twenty-nine
4、 And this offering and listing
