Youxun Technology Science and Technology Innovation Board will focus on optical communication devices, and intends to raise 560 million yuan

According to public information, the Shanghai Stock Exchange disclosed the results of the 17th Listing Committee Review Meeting of the Listing Committee of the Science and Technology Innovation Board in 2022, and Dalian Youxun Technology Co., Ltd. (hereinafter referred to as "Youxun Technology") made its first meeting, and the sponsoring institution was Guotai Junan Securities.

Image source: official website

The main business of Youxun Technology is the research and development, design, production and sales of optical devices, the main products are used in optical communications and optical sensing two major industries, terminal application scenarios cover telecommunications transmission networks, data centers, radio and television networks, aerospace, environmental and safety monitoring and other national key development areas.

The company is in the upstream of the optical communication industry, purchasing lasers, detector chips, and TEC, free space isolators, aspherical lenses and other components through the optical device design and manufacturing process to produce TOSA, ROSA and other optical device products, sales to downstream optical module manufacturers. At present, in the field of optical communication devices, the company's mass production products cover 2.5G, 10G, 100G and other transmission rates, in research or small batch trial production of 200G, 400G products, transmission distance coverage of 10km to 120km, can meet the needs of TDM, CWDM, LWDM, MWDM, DWDM and other channel multiplexing schemes.

Prior to the offering, the actual controllers of the Company, Liao Chuanwu and Jin Shuang, directly and indirectly controlled 70.57% of the Company's shares. Based on the proposed public offering of 15 million shares (excluding the use of over-allotment options), after the offering, the actual controller of the Company will directly and indirectly control 52.93% of the Company's shares.

The IPO plans to raise 560 million yuan, mainly for the development and industrialization of 5G optoelectronic devices.

1

Rely on the top five customers

After decades of updating and iteration, optical communication technology has been able to adapt to the future high-speed growth of massive data demand, and the continuous growth of data traffic demand for the development of the optical communication industry to provide a lasting driving force, is expected to 2022, the global optical sensor market size will increase to 183.6 billion yuan, 2016-2022 compound growth rate of 5%, China's optical sensor market size will increase to 118 billion yuan, 2016-2022 compound growth rate of 7%.

During the reporting period, the operating income of Youxun Technology was 29.1674 million yuan, 60.8217 million yuan, 146 million yuan and 102 million yuan, respectively, it is worth noting that the change in market demand in 2021 led to a decline in sales of 100G optical device products transmitted by 10km, which lowered the growth rate of operating income driven by 2.5G and 10G optical device products, and the overall operating income growth rate slowed down; the net profit attributable to the owners of the parent company was 7.8288 million yuan and 14.9593 million yuan. 53.3456 million yuan, 44.0265 million yuan.

In each period of the reporting period, the gross profit margin of the company's main business was 47.18%, 50.81% and 53.20% respectively, which was higher than the average of comparable listed companies in the same industry in China and comparable listed companies in the same industry overseas.

Specifically, during the reporting period, the sales revenue of Optical Communication Device Products of Youxun Technology accounted for more than 90% of the main business revenue, which was the company's main product, of which the sales revenue of 2.5G OSA and 10G OSA products accounted for a relatively high proportion.

It should be known that the downstream market of the optical device industry has the characteristics of high entry threshold and relatively concentrated market participants. During the reporting period, the main customers of Youxun Technology are the downstream optical transceiver manufacturers and equipment manufacturers in the industry, and the company's sales revenue from the top five customers accounts for 75.75%, 63.87%, 67.29% and 62.00% of the current operating income, respectively, and there is a certain customer concentration. If there is a significant change in the operating conditions or business structure of the company's downstream major customers and the reduction of the purchase of the company's products, or the loss of major customers, it may lead to the risk of decline in operating performance.

Specifically, the current main customers of Youxun Technology are Wuhan Liante, Sichuan Huatuo, New Yisheng and other wavelength division multiplexing optical transceiver manufacturing enterprises, the top five domestic optical module enterprises, New Yisheng for the company's reporting period of the main customer, the company for the intermediate Xuchuang, Huagong Technology has achieved sustained bulk sales but the current sales volume is temporarily small, has not yet achieved the sales of Guangxun Technology, Hisense broadband, it can be found that the company's sales to the downstream optical module major enterprises need to be further developed, market development is facing greater pressure.

2

Accounts receivable balances are rising year by year

In addition, in terms of product market share, public data shows that the global long-distance transmission of 10G CWDM and DWDM optical transceiver market size is about 730,000 in 2020, of which the 10G DWDM optical transceiver market size is about 470,000. The sales volume of 10G WDM TOSA of 1020 core product of Youxun Technology was 100,000 pieces, of which 10G DWDM TOSA sales were 77,000 pieces. Based on the above data, the company will account for about 13% of the global 10G WDM optical device market share in 2020 and about 16% of the global 10G DWDM optical device market share.

Compared with enterprises in the same industry, the company focuses on the segmentation of optical active devices with high rate, long distance and wavelength division multiplexing, and its competitors mainly come from the leading optical device suppliers in the United States and Japan, and a small number of optical module manufacturers such as domestic Optical Xun Technology extend their self-produced wavelength division multiplexed optical devices upstream, and there is also a certain competitive relationship with the company's products.

Due to the rapid iteration of technology in the optical device industry and the increasingly intensified market competition, domestic advanced optical transceiver enterprises need to increase the research and development of upstream optical device products, and in each period of the reporting period, the company's research and development expenses were 2.394 million yuan, 8.8719 million yuan, 11.7388 million yuan and 8.4269 million yuan, accounting for 8.21%, 14.59%, 8.04% and 8.24% of the operating income, respectively.

In addition, at the end of each reporting period, the balance of the company's accounts receivable was 7.4665 million yuan, 14.1243 million yuan, 24.6393 million yuan and 39.0006 million yuan, respectively; the company's accounts receivable turnover rate was 6.26, 5.93, 7.93 and 3.39, respectively. With the expansion of the company's operating scale, the closing balance of accounts receivable gradually increased. If there is an adverse change in the operating conditions of the company's downstream customers in the future, they may face the risk of bad debt losses caused by the inability to recover accounts receivable.

3

epilogue

With the advent of the 5G era and the development of the Internet of Things, the mainland optical sensing industry will have broad development space in the future, and terminal application scenarios will continue to be enriched.

Companies led by Youxun Technology should continue to invest in research and development in the field of high-end optical devices, actively explore and launch more types and more application scenarios of optical device products, and extend to the upstream optical chips and other fields to increase the market share of related products, thereby promoting the integration and development of the upstream and downstream of the domestic optical communication and optical sensing industry chain, and enhancing the mainland's ability to control the core technology of basic optoelectronic components.