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 risk. Investors should fully understand the investment risks of the gem and the risk factors disclosed by the company, and make investment decisions prudently. Weihai Honglin Electric Co., Ltd
(9-10 Pudong Road, Weihai Economic and Technological Zone)
Prospectus for initial public offering and listing on GEM
(Registration draft)
The company’s application for issuance and listing shall be subject to the corresponding procedures of Shenzhen Stock Exchange and CSRC. This Prospectus has no legal effect on the issuance of shares and is only for pre disclosure. Investors shall take the full text of the officially announced prospectus as the basis for making investment decisions.
Sponsor (lead underwriter)
North block of excellence Times Square (phase II), No. 8, Zhongxin Third Road, Futian District, Shenzhen, Guangdong Province
Overview of this offering
Type of shares issued: RMB ordinary shares (A shares)
Number of shares issued: the number of new shares issued this time shall not exceed 97.28 million, accounting for no less than 25% of the total share capital after issuance, and no transfer of old shares shall be carried out
The par value of each share is RMB 1.00
Issue price per share [] yuan
Expected issue date: mm / DD / yyyy
Stock exchanges and sectors to be listed Shenzhen Stock Exchange gem
The total share capital after issuance shall not exceed 389101809 shares
Sponsor and lead underwriter Citic Securities Company Limited(600030)
Signing date of prospectus: mm / DD / yyyy
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 integrity 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.
Tips on major issues
The company specially reminds investors that before making investment decisions, they must carefully read the full text of the prospectus, financial report and audit report, and pay special attention to the following important matters. 1、 Tips on major risks (I) innovation risks
The company specializes in the R & D, production and sales of power line components and special cables, is committed to improving the technical level and R & D efficiency of products, constantly developing new products and continuously expanding product application fields, so as to meet the diversified needs of customers in different downstream fields. The company continues to innovate in platform R & D, product development and supply chain management. However, if the company can not better serve customer needs in product development fields such as product quality controllability, product category diversity and applicability, supply chain management can not timely meet the high-frequency and diversified characteristics of product orders, and platform R & D is difficult to ensure the supply of low-cost and high-quality products, The company is at risk of not being recognized by the market, which will have a significant adverse impact on the company’s continued profitability. (II) risk of intensified competition in the industry
The company specializes in the R & D, production and sales of power cord components and special cables. Its products are widely used in personal computers, servers, household appliances, power tools and other industrial equipment. Although there are certain barriers to entry in the power line components and special cable industries, if the broad industry market space attracts downstream customers or enterprises in other fields to enter or urges existing production enterprises to expand production capacity, or the market space of downstream industries shrinks significantly due to major adverse macroeconomic changes, or due to price war in the industry Downstream customers continue to ask for price reduction, resulting in a sharp decline in product prices, which will intensify market competition in the industry. If the company cannot continuously and effectively formulate and implement business development plans and always maintain the competitive advantage of service ability and technical level, it may be in a disadvantageous position in the market competitive environment, which will affect the profitability and long-term development potential of the company. (III) product certification risk
There are mandatory safety certification requirements for power line components in major global markets, such as China CCC certification, American UL certification, EU ENEC certification, Australia SAA certification, Japan PSE certification, Korea KTL certification, etc. Various certification procedures are complex, require high technical level and require continuous capital investment. If the products fail to pass the corresponding certification, they cannot enter the local market. Therefore, if the company fails to continuously obtain various certifications in the global market, it will have an adverse impact on the company’s operation and product sales. (IV) risk of price fluctuation of raw materials
The company’s main products are power line components and special cables, and the main raw materials are copper, copper wire and other copper and chemical materials. During the reporting period, the purchase amount of copper, copper wire and chemical materials accounted for 43.90%, 57.23%, 69.92% and 81.28% of the main business cost respectively, and the cost of copper and copper wire accounted for 32.72%, 40.63%, 40.54% and 56.36% of the operating cost respectively. The impact of raw material price fluctuation on the company’s operating performance increased.
Assuming that the sales quantity, unit price, taxes and other factors remain unchanged, when the copper market price increases by 60.43% and 25.02%, the gross profit margin and net profit of the company in 2020 will be reduced to 0 respectively; When the market price of copper rises by 35.43% and 13.65%, the gross profit margin and net profit of the company will be reduced to 0 from January to June 2021 respectively.
At present, the company has a large number of manufacturers to choose when purchasing raw materials, and can purchase the required raw materials at a reasonable price. However, if there are periodic fluctuations in the future economic situation and changes in market supply and demand, resulting in significant fluctuations in the price of raw materials such as copper, and the rise of copper price is expected to reduce the gross profit margin of the issuer, and with the increase of copper price fluctuation, The higher the degree of negative impact on the issuer’s profitability, the issuer’s operating performance will face the risk of decline. (V) risk of adverse impact of covid-19 pneumonia on the company’s operation
The outbreak and continuation of the covid-19 virus epidemic had a great impact on the production and operation of global enterprises. At present, the epidemic situation of covid-19 virus in China has improved, and the production and operation of enterprises have gradually returned to normal. However, the overseas epidemic situation is more severe, and there is the possibility of further large-scale spread. Although the company’s products are mainly sold domestically and the business is carried out normally, excluding the factors affecting the disposed atomic Company Dezhou Jincheng, the performance in 2020 has increased compared with the same period last year. However, if the epidemic continues for a long time or spreads further, it may have an adverse impact on the company’s operating performance. The company’s plant in Thailand was put into operation in June 2020, while the epidemic situation in Thailand showed an outbreak trend in the first half of 2021. Due to the uncertainty of the overseas covid-19 pneumonia epidemic situation, if the impact of the epidemic situation continues or worsens further in the future, the normal production and operation of the company’s plant in Thailand may be adversely affected. (VI) risk of issuance failure
The issuance result of this issuance will be determined by various internal and external factors such as the overall situation of the securities market, the operating performance of the issuer and the recognition of investors for this issuance. In case of insufficient subscription by investors, the issuer will face the risk of issuance failure.
2、 Main financial information and operating conditions after the period
Between the audit benchmark date of the financial report and the signing date of the prospectus, the company’s operation is in good condition, there are no major changes in industrial policies, tax policies, industrial market environment, major customers and suppliers, and the company’s business model, and there are no major changes in directors, supervisors, senior managers and core technicians, There are no other major events that may affect the judgment of investors. 3、 Important commitments related to this offering
Important commitments related to this offering, including share circulation restrictions, voluntary lock-in commitments, shareholders’ shareholding intention and reduction intention before public offering, measures and commitments to stabilize the stock price, etc. For details, please refer to “VI. commitments” in “section 10 investor protection” of this prospectus. 4、 Dividend distribution and accumulated profit policy
For details on dividend distribution of the company, please refer to “II. Dividend distribution policy” and “III. arrangement of accumulated profits before this offering” in “section 10 investor protection” of this prospectus. 5、 Main financial information and operating conditions after the period (I) financial information of the third quarter of 2021 and operating conditions after the audit deadline
For the main financial information and operating conditions after the audit deadline of the company’s financial report, see “XVIII. Main financial information and operating conditions after the audit deadline of financial report” in “Section VIII Financial Accounting Information and management analysis” of this prospectus. The relevant financial information has not been audited and has been reviewed by Rongcheng Certified Public Accountants (special general partnership) and issued the review report (Rongcheng zhuanzi [2021] No. 518z0581).
1. Main data of consolidated balance sheet
The main data of the company’s consolidated balance sheet on September 30, 2021 and December 31, 2020 are compared as follows:
Unit: 10000 yuan
Change proportion of the project from September 30, 2021 to December 31, 2020
Total assets 201155.97 155956.16 28.98%
Total liabilities 127280.32 94895.25 34.13%
Total owner’s equity 73875.66 61060.91 20.99%
Owner’s equity attributable to the parent company 73769.90 61006.59 20.92%
As of September 30, 2021, the total assets of the company were 201.15597 million yuan, an increase of 451.9981 million yuan compared with December 31, 2020, mainly due to: (1) the growth of the company’s business scale led to the obvious growth of current assets such as working capital, accounts receivable and inventory, of which monetary capital increased by 56.4757 million yuan and accounts receivable increased by 209.2755 million yuan, The inventory increased by 108.2436 million yuan; (2) In 2021, the second phase plant of the company’s Thai plant was put into use, the production line equipment increased, and the non current assets increased by 25.4402 million yuan.
On September 30, 2021, the total liabilities of the company were 1272803200 yuan, an increase of 323850700 yuan compared with December 31, 2020, mainly due to: (1) the growth of the company’s business scale and the continuous construction of phase II of Thailand factory, resulting in the increase of capital demand and the increase of short-term borrowings of 222.4411 million yuan; (2) The growth of business scale led to the increase of procurement scale. Superimposed on the significant rise in the price of main raw materials from January to September 2021, the procurement amount of main raw materials of the company increased, and the accounts payable increased by 92.7985 million yuan.
On September 30, 2021, the owner’s equity attributable to the parent company was 737.699 million yuan, an increase of 127.6331 million yuan compared with December 31, 2020, mainly from the retained profits from January to September 2021.
2. Main data of consolidated income statement
(1) Main data of consolidated income statement from January to September 2021 and from January to September 2020
Unit: 10000 yuan
Project from January to September 2020, 2021
