"Electric Eel Finance" text / Lin Yan
On March 22, Ningbo Changya New Material Technology Co., Ltd. (hereinafter referred to as "Changya Co., Ltd.") replied to the second round of audit inquiry letter and updated the materials. In the IPO of the main board of the Shenzhen Stock Exchange, Changya Co., Ltd. plans to raise 723 million yuan for the construction project of bio-based degradable new material products and high-end plastic products, the expansion project of paper products with an annual output of 20,000 tons in Changya, Vietnam and the upgrading and construction project of R&D center.
"Electric Eel Finance" found that there are many doubts in the company's IPO prospectus, especially the weak research and development, coupled with the internal control crisis that the husband and wife holdings have presented, so that the market is cautious about the company's listing.
Husband and wife holding and abnormal capital exchanges
According to the prospectus, Changya shares have a total of 16 shareholders, of which 3 shareholders hold more than 5% of the issuer's shares, namely Changya Holdings, Xu Jianhai and Zhenhai Haijiang. In addition, Zhenhai Investment, Veegoo Investment, and Zhenhai Yongjiao are all persons acting in concert with Zhenhai Haijiang. The controlling shareholder of Changya shares is Changya Holdings. As of the date of this Prospectus, Changya Holdings directly held 53,591,000 shares of the Company, accounting for 57.76% of the total share capital before the issuance.
The actual controllers of Changya shares are Xu Jianhai and Wang Meilan, and the two parties are husband and wife. Xu Jianhai and Wang Meilan indirectly held 53,591,000 shares of the Company through the control of Changya Holdings, accounting for 57.76% of the total share capital before the issuance; At the same time, Xu Jianhai directly holds 13,272,440 shares of the Company, accounting for 14.30% of the total share capital before the issuance. Xu Jianhai and Wang Meilan together control 72.06% of the voting rights of the company and are the actual controllers of the company. Among them, Xu Jianhai has served as the chairman and general manager of the company since November 2021, and Xu Jianhai will receive a salary or allowance of 2.5419 million yuan from the company in 2022.
"Electric Eel Finance" noticed that the exchange continued to check the corresponding capital flows of Xu Jianhai and Wang Meilan, and found many abnormalities and violations. How deep the "water" really is, people do not know.
According to the relevant requirements of the Guidelines for the Application of Regulatory Rules - Issuance No. 5, the abnormal standards determined by the sponsor institution and the reporting accountant in the verification of the capital flow of Xu Jianhai and Wang Meilan, the actual controllers of the company, are as follows: (1) Xu Jianhai and Wang Meilan's personal accounts have a large amount of funds and have no reasonable explanation, or frequently deposit or withdraw large amounts of cash; (2) whether Xu Jianhai and Wang Meilan received large cash dividends, remuneration or asset transfer funds from the issuer, and obtained large equity transfer funds from the transfer of the issuer's equity, and there were major abnormalities in the main capital flow or use; (3) Whether Xu Jianhai and Wang Meilan have abnormally large capital transactions with the issuer's related parties, customers and suppliers.
The exchange questioned whether the corresponding capital transactions were related to customers and suppliers, and whether there was an extracorporeal capital circulation to form sales receipts or bear costs? After verification, during the reporting period, Xu Jianhai and Wang Meilan, the actual controllers of the company, had the following fund receipts and expenditures related to the company's customers and suppliers: first, Xu Jianhai lent 3.08 million yuan to the actual controller of the company's outsourcing supplier, Ningbo Tianjie Plastic Products Co., Ltd. (hereinafter referred to as "Tianjie Plastics"), and all of them were returned in April and May 2023 before listing; Second, the company received 8.1638 million yuan of payment and advanced costs of 6.1184 million yuan through the bank account, WeChat account and Alipay account actually controlled by the actual controller or instructed by it, which exposed the company's serious lack of awareness of standardization.
According to industry insiders, equity concentration and "one dominant share" have always been regarded as a stumbling block to improving the governance structure of listed companies. Especially in private enterprises, if the actual controller of the company is a natural person or family, the weakness of the corporate governance structure will be more prominent. In this way, how can the interests of ordinary investors be protected? Will there be any benefit transfer behavior?
The ability to innovate in science and technology is weak
"Electric Eel Finance" noticed that there are signs of decline in the R&D strength of Changya shares.
First of all, from the perspective of the number of R&D personnel, during the reporting period, the number of R&D personnel of the company was 34, 44, 45 and 43 respectively, accounting for 2.45%, 3.48%, 3.12% and 2.38% of the total number of employees, showing a downward trend.
Secondly, from the perspective of the distribution of R&D personnel's educational qualifications, during the reporting period, the number of master's degree or above was 1, 2, 2, and 1, respectively, and the number of undergraduates was 5, 4, 6, and 4, respectively, including the number of college graduates, which were all decreasing at the end of September 2023. However, the number of people with high school education or below continued to increase, with 23, 32, 35 and 36 respectively. As of the end of September last year, the proportion of R&D personnel with high school education and below in Changya Co., Ltd. was as high as 83.72%; If college degree is added, the proportion of R&D personnel with college degree or below reaches 88.37%.
That is to say, among the 10 R&D personnel, 1 person has a college degree or below, so the R&D team can hardly be called a specialized and new small giant company. As of the end of September last year, there were 1,763 people below the college level (excluding college personnel), accounting for 93.43%.
Thirdly, from the perspective of R&D expense rate, the company's R&D expenses during the reporting period were 7.9603 million yuan, 11.5354 million yuan, 15.2154 million yuan and 9.9079 million yuan, accounting for 1.55%, 1.85%, 1.66% and 1.85% of operating income respectively. Compared with its peers, the R&D rate of Changya shares is significantly low, and even only half of the average of comparable companies in the industry. During the reporting period, the average values of comparable companies in the industry were 3.80%, 3.55%, 3.32% and 3.71% respectively.
In terms of R&D investment, the first three quarters of 2023 will be 9.9079 million yuan, which is only 13.21 million yuan in one year, a decrease of more than 13% compared with 2022.
In short, in the case of the lowest R&D rate in the industry, the reduction of R&D personnel and the low education of R&D personnel, the R&D strength of Changya shares is bound to decrease. The market questioned that in the future, even if the company is lucky enough to go public, what will it rely on to win competitiveness? However, the company's prospectus stated that "the company has strong R&D and innovation capabilities, and is representative in the industry." ”
Xu Jianhai is entangled in more than 100 risks
Xu Jianhai, chairman and general manager of Changya Co., Ltd., not only realized the holding of shares, but also actually controlled two enterprises. What is particularly noteworthy is that Xu Jianhai is entangled in hundreds of risks.
Tianyancha shows that Xu Jianhai currently has 5 pieces of employment information, 3 as shareholders, 4 as executives, and as many as 2 companies with actual control. There are 38 surrounding risks and 99 early warning reminders.
In terms of high risk, Ningbo Changya Plastic Products Co., Ltd., where he served as the legal representative, has information on the final case; Ningbo Changya Plastic Products Co., Ltd., which had served as the legal representative, was simply deregistered, and Ningbo Pengli Plastic Technology Co., Ltd., which served as an executive, was simply deregistered.
In terms of litigation, Ningbo Changya Plastic Products Co., Ltd., which had served as the legal representative, was sued for a dispute over a financial loan contract.
In addition, Ningbo Baili International Trade Co., Ltd., of which he served as the legal representative, was subject to administrative penalties for other reasons; Ningbo Changya New Material Technology Co., Ltd., which serves as the legal representative, has movable assets in a mortgage state.
Combined with the above-mentioned actual controllers, people have to worry, who will protect the interests of investors? "Electric Eel Finance" will continue to pay attention to the progress of the bizarre IPO of Changya shares.