Recently, the IPO status of Changchun Hyprun Technology Co., Ltd. (hereinafter referred to as "Hypruns") on the Shenzhen Stock Exchange is shown as "suspended" because the financial information recorded in the application documents has expired and needs to be supplemented.
According to the prospectus, Hypruns is an enterprise mainly engaged in the research and development, production, sales and purification services of OLED evaporation material technology, and its listing application was accepted by the GEM on April 4, 2023, but it was selected for on-site inspection 10 days later, and was criticized by the regulatory authorities for incomplete information disclosure and inaccurate data.
Even though Hyrunpu has replied to the two rounds of inquiries from the Shenzhen Stock Exchange, the market still has doubts about its equity holding, dependence on a single large customer, the accuracy of expense accounting and other issues, and the third round of audit inquiry letters from the Shenzhen Stock Exchange has also been issued on August 12, 2024, pending the answers of Hyrunpus.
1. There are multiple acts of equity holding on behalf of others
The predecessor of Hypruns, Changchun Hypruns Technology Co., Ltd., was established in May 2015 and was jointly funded by Li Xiaohua and Guo Jianhua, with a registered capital of 10 million yuan. At that time, the actual controller Li Xiaohua entrusted Guo Jianhua to hold 19% of the equity of Hypruns on his behalf.
It is worth noting that of the 4.9 million yuan of registered capital paid by Guo Jianhua, 1.9 million yuan was paid on behalf of Li Xiaohua, and 3 million yuan was donated by Li Xiaohua to Guo Jianhua for paid-in capital. In other words, the registered capital at the beginning of the establishment of Hyprun was actually paid by Li Xiaohua alone.
In March 2016, Zhao Huifen, the financial director of Hypruns, paid a capital contribution of 5.1 million yuan on behalf of Li Xiaohua, and Zhao Huifen held 51% of the equity on behalf of Li Xiaohua. A few months later, the external shareholder Integration Venture Capital requested the release of Zhao Huifen's nominee shareholding based on normative considerations, while Guo Jianping's nominee shareholding was not lifted until 2019.
The Shenzhen Stock Exchange attaches great importance to the above-mentioned nominee holdings, and twice asked Hypruns to explain the specific reasons why Li Xiaohua entrusted Guo Jianhua and Zhao Huifen to hold shares on behalf of the company, as well as whether Li Xiaohua was unsuitable to serve as a shareholder at the beginning of the company's establishment, and whether there was any circumvention of relevant laws and regulations.
Hypruns explained that in the early days of its establishment, part of Li Xiaohua's equity was held by Guo Jianhua, and the two mainly agreed that this part of the equity would be mainly used to motivate and introduce talents in the future, and Guo Jianhua would be responsible for the company's internal talent team building. On the other hand, Guo Jianhua lives in Changchun all the year round, which is more convenient for handling industrial and commercial change registration.
Zhao Huifen's nominee holding situation was mainly due to the fact that in order to apply for rent subsidies at that time, Hyprun needed to handle matters such as the paid-in registered capital and industrial and commercial taxation in a short period of time, while Li Xiaohua was inconvenient to go through the response procedures in Changchun due to the restrictions of his work and living place, so he entrusted Zhao Huifen to handle it, and there was no circumvention of relevant laws and regulations.
As of this IPO, Li Xiaohua directly held 35.43% of the shares of Hypruns, and indirectly held 0.52% of the shares through Qunhui Investment and Selene. Li Xiaohua holds a total of 35.94% of the shares of Hypruns, and is the largest shareholder and controlling shareholder of the company.
At the same time, Guo Jianhua, director and general manager of Hipperuns, holds 19.64% of the shares, Liu Libin holds 8.19% of the shares, Zhongjin Qichen holds 5.28% of the shares, Suzhou Sanxing holds 4.29% of the shares, Qingdao Songhe holds 3.32% of the shares, SDIC Chuanghe holds 2.73% of the shares, and Yuanzhi Bida holds 2.20% of the shares.
Second, the income is very dependent on BOE
According to the prospectus, from 2021 to 2023, Hypruns will achieve revenue of 207 million yuan, 296 million yuan and 349 million yuan respectively, with a compound annual growth rate of 29.91%, of which the revenue growth in 2022 will be relatively fast, with a growth rate of 43.28%, mainly due to the growth of sales revenue of recycled material purification business and inorganic materials business.
During the same period of the reporting period, the net profit of Hypruns was 45.444 million yuan, 84.7412 million yuan and 102 million yuan respectively, with a compound annual growth rate of 49.67%; Its net profit after deducting non-profits also increased from 44.0049 million yuan in 2021 to 82.2784 million yuan in 2022, and further increased to 94.3448 million yuan in 2023.
The reason why Hypruns was able to quickly gain a foothold in the market was that its partner BOE (000725. SZ) is indispensable. At the beginning of its establishment, Hypruns took a fancy to BOE's market position in the field of OLED panels, listed it as a key customer, and used limited resources to carry out R&D and sample delivery activities around BOE.
Combing the timeline, it can be seen that Hypruns established contact with BOE's supply chain and development department after only one month of establishment, and passed the supplier verification in July 2016, and the verification cycle took only 13 months. A year later, Hypruns entered BOE's sixth-generation flexible OLED panel production line supply chain and occupied a leading position.
At present, the company has established stable cooperative relations with many well-known domestic OLED panel companies such as Tianma Group, Huaxing Optoelectronics, and Hui Optoelectronics, and also provides OLED evaporation materials for mobile device brands such as Huawei and Honor.
During the reporting period, the sales amount of Hypruns from BOE was 182 million yuan, 261 million yuan and 314 million yuan respectively, accounting for 87.84%, 88.21% and 90.12% of its total sales amount, and BOE was the core customer of Hypruns.
The dependence of large customers will undoubtedly have an adverse impact on the sustainable development and anti-risk ability of enterprises. For this reason, the Shenzhen Stock Exchange requires Hypruns to explain whether its single dependence will exist for a long time and the basis that such phenomena do not constitute a material adverse impact in light of practical factors.
In the reply letter, Hypruns said that according to the order of development of new materials corresponding to customers, BOE's new material verification and mass production progress are usually earlier than other customers, and in the future, the company's sales will still exist and continue to rely on BOE.
However, Hypruns is optimistic about BOE's development prospects, believing that the latter's OLED panel sales scale is showing a good growth trend, is competitive in the global OLED panel market, and covers a more comprehensive range of terminal brands, which will not have a significant adverse impact on its ability to continue operations.
3. Former customer executives cashed out at a high rate
However, it should be pointed out that the interests of Hyprun and BOE may be far more than just business dealings. In December 2016, Zhao Feng transferred 7% of the shares of Hyprun held by Guo Jianhua and Li Xiaohua on behalf of Wang Jiaheng at the rate of 1 yuan/registered capital, and the payment period was not stipulated in the transfer agreement.
After Wang Jiaheng paid 700,000 yuan for the equity transfer in September 2019, he transferred 3,604,300 shares of Hyprun to five investment funds including Suzhou Sanxing Zhiqi Venture Capital Partnership (Limited Partnership) at a price of 34.97 million yuan, and the above five investment funds were introduced by Wang Jiaheng himself.
According to this calculation, this operation helped Wang Jiaheng obtain more than 34 million yuan in just three years. Wang Jiaheng is just a former executive of BOE, who was a director and co-COO of BOE, responsible for the operation of the display business, and left in October 2015, and Zhao Feng, who holds shares on behalf of Wang Jiaheng, is the sister of his spouse.
Senior managers who have worked in large accounts have bought shares at a low price and cashed out at a high price, which inevitably makes people doubt the reasonableness of the equity transfer. The Shenzhen Stock Exchange also questioned the matter, requiring Hypruns to explain the reasons why Wang Jiaheng obtained his shares through nominee holding and did not pay the actual payment, and whether there was commercial bribery and benefit transfer.
Hyprun firmly denied this, saying that when it contacted Wang Jiaheng, the latter had left BOE and was mainly responsible for the investment business of Beijing Silicon Kinetic Energy Investment Management Co., Ltd. (hereinafter referred to as "Silicon Kinetic Energy"), although it was not recognized by professional investment institutions such as Silicon Kinetic Energy at that time, Wang Jiaheng himself was willing to provide financing-related help.
When Wang Jiaheng became a shareholder, the relevant transfer agreement did not stipulate the payment period, and the price was low, mainly because the equity transferor Li Xiaohua and Guo Jianhua believed that Hypruns was in the start-up period, the revenue scale was very small, and it was basically unprofitable, and the corresponding equity transfer price was small, which was based on the comprehensive consideration of factors such as the company's market value.
Hypruns added that other transferees who invested in Hypruns at the same time as Wang Jiaheng, such as Tang Wei, Ling Shidao, Zhao Wei and Wang Huan, also failed to pay the transfer money in a timely manner. Therefore, the above situation was determined by the development stage of Hypruns, and was determined through negotiation among the transferring shareholders, and was not a special arrangement for Wang Jiaheng personally.
In 2019, some investors who were optimistic about the development of Hypruns failed to get the capital increase quota, so they negotiated with the original shareholders and hoped that they would sell part of their existing shares. Considering the low cost of its shares, the long period of the company's listing and the existence of a lock-up period after listing, Wang Jiaheng decided to sell all his shares to external investors.
To sum up, Hypruns believes that Wang Jiaheng does not have the ability to obtain BOE's supply qualifications for him, and that it is reasonable to obtain his shares through nominee holding and the unpaid payment is reasonable, and there is no commercial bribery. Hypruns' entry into BOE's supply chain system is also the result of independently obtaining customer resources through market competition.