Interface News Reporter |
From the submission of the form in March this year to the meeting in November, the listing process of Zhejiang Xinkai Technology Group Co., Ltd. (hereinafter referred to as "Xinkai Technology") has passed halfway.
Xinkai Technology is mainly engaged in the product development, sales and service of organic pigments and other colorants. Compared with most IPO companies, the special point of Xinkai Technology is the production model - no independent production. At the meeting, the focus of the Listing Review Committee's inquiry was also on the company's business model and the stability of business development.
Entered the trial production stage
During the reporting period, Xinkai Technology mainly purchased organic pigments and other colorant products produced according to the company's requirements from suppliers, and the procurement cost accounted for 93.27%, 94.88%, 93.05% and 94.04% of the main business costs respectively, among which some suppliers Lily and Colorful Chemical were also competitors of the company.
Downstream, the main customers of Xinkai Technology are internationally renowned enterprises such as DIC Co., Ltd., Flint Group, Siegwerk Group, Sherwin-Williams Group, and Axalta Group.
In order to break this situation, Xinkai Technology began to carry out independent production. According to the implementation letter of the audit center, the company's own production bases Liaoning Xinkai and Liaoning Ziyuan are under construction.
Among them, the Liaoning Ziyuan construction project is still in the early stage of construction, which is located in Binhai Chemical Park, Binhai New Area, Jinzhou City, Liaoning Province, and will be engaged in the production of high-quality permanent purple organic pigments after completion, with a design capacity of 1,500 tons/year.
According to the disclosure, the Liaoning Ziyuan project will complete the infrastructure work of the main main buildings in September 2023, complete the installation of all equipment in the second quarter of 2024, complete the commissioning of the production line in the third quarter of 2024, carry out the commissioning of the production line with materials and the preliminary preparation for trial production in the fourth quarter of 2024, and start trial production and production in 2025.
Liaoning Xinkai construction project plans to produce 5,000 tons of organic azo pigments and 5,000 tons of azo dyes, starting from August 2023, Liaoning Xinkai will enter the trial production stage, and in September, the production line will reach the predetermined usable state after trial production verification and turn into fixed assets.
As of September 30, 2023, Liaoning Xinkai has successively put into production of pigments and dyes, with a total of 77.53 tons of finished products, of which 24.97 tons have been sold, with sales of 3.4984 million yuan.
According to the feasibility study report, the annual sales revenue of Liaoning Xinkai's self-built project after full production is 598.81 million yuan, which is calculated on the basis of the company's 2022 annual revenue of 1.192 billion yuan, accounting for about 30%.
Xinkai Technology also made it clear that the company also plans to increase the purchase volume of external supply chain after the self-built production base reaches production to further improve the company's overall operating scale, and the corresponding revenue proportion of the self-built production base will also decrease. In the future, a supply chain resource structure will be formed with external supply as the mainstay and self-built production capacity as a supplement.
Post-period performance declined
From the perspective of the competitive landscape, the global organic pigment suppliers can be roughly divided into three categories according to their sales scale: first, traditional international suppliers DIC Co., Ltd. and Heubach, DIC Co., Ltd. and Heubach Co., Ltd. have annual sales of more than 5 billion yuan, and second, several medium-sized enterprises, including DCL Corporation in the Americas, Toyo in Japan, SUDARSHAN and Vibrantz Technologies in India Inc., as well as China's Lily, Qicai Chemical, Shuangle Co., Ltd., medium-sized companies with annual sales of more than 1 billion yuan, and third, hundreds of small enterprises, mainly concentrated in Asia, with annual sales of less than 1 billion yuan.
From 2020 to 2022 and the first half of 2023, the operating income of Xinkai Technology will be 997 million yuan, 1.206 billion yuan, 1.192 billion yuan and 534 million yuan respectively, and the net profit will be 61.1912 million yuan, 89.0227 million yuan, 87.6498 million yuan and 40.7642 million yuan respectively.
According to the prospectus, according to the assessment of the Organic Pigment Professional Committee of the China Dye Industry Association, Xinkai Technology has ranked first in the national organic pigment export industry for many years from 2015 to 2022. According to the data of Market Research Future, a market research institution, from 2020 to 2022, the global organic pigment market size will be about 35.005 billion yuan, 33.786 billion yuan and 36.862 billion yuan respectively, and the company's organic pigment sales amount will be 950 million yuan, 1.147 billion yuan and 1.145 billion yuan respectively, and the company's share of the global organic pigment market will be about 2.71%, 3.39% and 3.11%.
In contrast, during the reporting period, the company's consolidated gross profit margin was relatively stable and lower than the average of comparable companies in the same industry, which the company explained was mainly due to differences in business models. The company's business model is to directly purchase finished products for external sales, and the company's pricing model with customers is to negotiate product sales prices with customers based on product procurement costs, while the gross profit margin of comparable companies in the same industry is mainly affected by the prices of upstream raw materials and energy, as well as their own capacity utilization and product sales prices.
In other words, will the company's gross profit margin fluctuate in the future due to the impact of the independent production model?
In the last draft, Xinkai Technology disclosed the performance of the first three quarters of this year.
From January to September 2023, the company's operating income was 793 million yuan, a year-on-year decrease of 15.91%, of which the average sales price of the main business decreased by 9.63% year-on-year, the sales volume decreased by 5% year-on-year, and the net profit attributable to the parent company was 66.4905 million yuan, a year-on-year decrease of 6.75%.
Xinkai Technology explained that the decline in revenue was mainly due to the impact of macroeconomic slowdown, international geopolitical conflicts and other effects of weak downstream demand.