On April 8, Jiaoxia Holding Co., Ltd. (hereinafter referred to as "Jiaoxia") submitted an application for listing on the main board to the Hong Kong stock exchange, and China International Capital Corporation Limited(601995) , Morgan Stanley served as the co sponsors.
China's largest sunscreen clothing brand
In recent years, as people pay more and more attention to a healthy and energetic lifestyle and improve their awareness of anti-aging and skin protection, the market scale of sunscreen clothing has increased from 45.9 billion yuan in 2016 to 61.1 billion yuan in 2021, with a compound annual growth rate of 5.9%.
According to insight consulting, the sunscreen clothing market is expected to grow at a compound annual growth rate of 9.4% from 2021 to 2026, and the market scale will reach 95.8 billion yuan by 2026. Over the same period, the online sales of the industry will grow at a compound annual growth rate of 13.0%, reaching 42.8 billion yuan in 2026.
According to the prospectus, Jiaoxia brand was founded by two post-80s in Hangzhou in 2013. Its products are designed for non competitive sports and outdoor activity scenes with leisure and social attributes, including urban life, leisure sports, travel and vacation, outing and hiking, exquisite camping, etc. Since the launch of the first sunscreen product double-layer small black umbrella in 2013, Jiaoxia has built a diversified product portfolio, mainly covering clothing, umbrella tools, hats, other accessories, shoes, etc.
Among them, the first double-layer small black umbrella to let Jiaoxia out of the circle helped Jiaoxia defeat the Chinese umbrella giant paradise umbrella and become the first in the sales of umbrella brands in online channels. According to the data, as early as 618 in 2020, the sales of banana umbrellas on tmall platform reached 6.81 million yuan, far exceeding the sales of 3.92 million yuan of Paradise umbrellas in the second place. However, in terms of sales at that time, Jiaoxia did not have an advantage. Compared with the sales of more than 100000 paradise umbrellas, Jiaoxia sold only 35000; However, the average price of paradise was less than 40 yuan, and the average price of nearly 200 yuan finally made Jiaoxia surpass in sales.
Source: magic mirror Market Intelligence
In recent years, the sales of sunscreen products under banana have achieved "full flowering". According to the flagship store of Jiaoxia tmall, Jiaoxia masks currently ranks first in hot sales, with a price ranging from 59 yuan to 99 yuan, and a monthly sales volume of more than 200000; The monthly sales of the best-selling sunscreen hat is 90000 +, excluding the preferential price, and the selling price is between 179 yuan and 298 yuan; In addition, the top selling sunscreen clothes and full face sunscreen masks also sold more than 80000 a month.
Based on the total retail sales and online retail sales in 2021, Jiaoxia is the largest sunscreen clothing brand in China, with a market share of 5.0% and 12.9% respectively. Jiaoxia said that the company has obvious advantages in online channel sales. During the track record period, Jiaoxia's annual online retail sales ranked first among all sunscreen clothing brands in China. According to burning knowledge consulting, in 2021, the online retail sales of Jiaoxia sunscreen clothing exceeded five times that of the second largest brand.
Revenue in 2021 increased by 203% year-on-year
In terms of performance, Jiaoxia's revenue has increased steadily in recent three years. According to the prospectus, the revenue from 2019 to 2021 was RMB 380 million, RMB 790 million and RMB 2.41 billion respectively, with a compound annual growth rate of 150.1%. From 2019 to 2021, the gross profit was 190 million yuan, 460 million yuan and 1.42 billion yuan respectively, and the gross profit margin was 50.0%, 57.4% and 59.1% respectively. The adjusted net profit in 2021 was 140 million yuan, with a compound growth rate of 162.6% in recent three years.
According to the breakdown of specific categories, the income of banana umbrellas accounted for the largest proportion in 2019, accounting for 86.9%, and the income of hats, clothing and other products accounted for less than 10%. By 2021, the revenue share of main categories of products tends to be balanced, among which the revenue share of clothing has increased to 29.5%, and the revenue share of sunglasses, masks and other accessories has also increased to 25.4%. The proportion of umbrella income decreased to 20.8%.
In terms of customer base, Jiaoxia revealed that the total number of paying customers of tmall flagship store, one of the main sales channels, increased from 1 million in 2019 to 3 million in 2020, and further increased to 7.5 million in 2021, a year-on-year increase of 150.0%, and the repurchase rate reached 46.5%.
In terms of sales channels, the revenue from self operated channels accounted for 83.6% in 2021, of which the compound growth rate of sales revenue from online stores and e-commerce platforms in recent three years was 160.9%. In terms of distribution channels, by the end of 2021, Jiaoxia had 872 distributors, and the revenue generated through distributors accounted for 16.4% of the total revenue.
In addition, Jiaoxia has also actively expanded its offline retail stores and other offline retail networks, from 39 stores in 15 cities in 2019 to 66 stores in 23 cities in 2021.
It is worth noting that while the revenue has increased, the advertising and marketing under the banana have also increased year by year in the past three years. The prospectus shows that in 2019, 2020 and 2021, the company's advertising and marketing expenses accounted for 9.6%, 15.0% and 24.4% of its revenue respectively.
In this regard, Jiaoxia said that the increase in advertising and marketing expenses is mainly due to the company strengthening the investment of existing marketing channels and expanding new marketing channels to promote products and enhance brand awareness, which will bring sustainable income and profits to the company in the long run.
Has 123 patents
Due to the strong profitability of the company, Jiaoxia only had three times of financing in the initial stage of establishment and in the early stage of IPO. Tianyancha app shows that the investors of the three times of financing are Sequoia China, cornerstone capital and Fengqiao capital respectively.
In order to maintain the leading position in the market year by year. From 2019 to 2021, the company's R & D expenditure was 19.9 million yuan, 35.9 million yuan and 71.6 million yuan respectively. The prospectus shows that the R & D team is composed of about 31 employees as of December 31, 2027.
According to the prospectus, Jiaoxia R & D team is committed to transforming product solutions into its own core technologies, such as airoop fabric, original yarn sunscreen technology and omni-directional push-pull honeycomb technology, l.r.c coating technology, silent honeycomb technology and flexcore lightweight sole technology. As of the last practicable date, Jiaoxia has 123 patents in China and is applying for 72 patents. It is reported that the sales of ice thin shawl sunscreen clothes with airoop fabric launched in early 2020 reached 276 million yuan in 2021.
Source: tmall Jiaoxia official flagship store
However, there are different views on Jiaoxia's self proclaimed core technology in the market. For example, the self-developed l.r.c coating technology that can block 99.9% ultraviolet rays, which was publicized when xiaoheiumbrella was first launched, the official information shows that its main components are polyurethane, metal titanium oxide and compound light stabilizer. Polyurethane, namely Pu, is the basic component of sunscreen umbrella black glue coating, metal titanium oxide is also a common physical sunscreen, and light stabilizer is mainly used to weaken the degradation of light on the coating and prolong the service life of the umbrella.
The relevant person in charge of Hangzhou paradise umbrella group also said publicly in an interview that the national standard sunshade sunscreen factor is 40, and the SPF of many sunshades on the market can reach hundreds or even thousands, so there are umbrellas that can isolate 100% ultraviolet rays.
"The general sunshade is to use the coating on the surface to physically isolate the ultraviolet light, and the darker the coating color, the better the sunscreen effect. Therefore, although the black glue coating is not beautiful, the sunshade coated with black glue is generally produced now."
On the platform of tmall Jiaoxia flagship store, the sunscreen mask with the highest sales volume has a monthly sales of 200000 +. But in the inquiry about the real sunscreen effect of the product, many consumers said frankly that they didn't feel much.
The prospectus shows that in the future, Jiaoxia will also increase investment in R & D, continuously expand and update outdoor functions and launch innovative designs with lasting popularity by cultivating and recruiting product development talents, increasing internal R & D investment and core technology accumulation, and deepening external R & D cooperation. In addition to deeply cultivating the Chinese market, Jiaoxia is also committed to expanding innovative products overseas and bringing excellent product experience to global customers in urban outdoor scenes through cooperation with local online and offline retailers.
For the purpose of fund-raising, Jiaoxia said it would be used to strengthen product development and enhance R & D capacity; Improve brand awareness and recognition, as well as brand discrimination; Strengthen the omni channel sales and distribution network, improve the market penetration of products and increase the market share; Improve supply chain management; Provide funds for the company's digital operation; Promote business growth through strategic alliances, acquisitions and investments; Working capital and general corporate purposes.
