Child King went public for the second time, but failed to raise 2.449 billion yuan as desired, in the face of the strong influx of giants such as JD.com into the mother and baby track, child king pressure is great.
Wen 丨BT Finance Dream Xiao
On October 14, Child King Children's Products Co., Ltd. (301078. SZ) (hereinafter referred to as "Kid King") is listed on the Growth Enterprise Market of the Shenzhen Stock Exchange. The total amount of funds raised in the offering was 627 million yuan, the issue price was 5.77 yuan per share, and the number of shares issued was 108.906667 million shares.
The stock price reached a maximum of 25.20 yuan on the opening day, and the closing price on the first day of listing was 23.30 yuan. It soared 303.8% from the issue price, with a market value of 25.35 billion yuan, becoming the highest market value of mother and baby products company in China. But then the stock price began to fluctuate, on the 17th, the child king stock price fell by 14.03%, the total market value of 21.79 billion, 2 days market value shrank 3.6 billion yuan.
<h1 class="pgc-h-arrow-right" data-track="5" > profit margin decreased Fundraising was not as desired</h1>
This is not the first time that the child king has been listed, as early as December 2016, the child king has been successfully listed on the new third board, but perhaps the fundraising is not ideal, the child king chose to delist less than two years after the listing, it is understood that the market value of the child king before the delisting was 16.7 billion yuan.
After three years of brewing and preparation, Kid King successfully landed on the A-share market and achieved the miracle of a 303.8% surge in stock prices on the first day. It is just that the stock price has soared, and the increase in market value has not achieved the first priority of the child king's listing. After the listing, the total amount of funds raised by Child King was only 627 million yuan, which was far from the goal of Child King's original plan, and only 1/4 of it was achieved. According to the prospectus of Child King, Child King intends to raise funds of 2.449 billion yuan, which will be used for four convenient business developments such as omni-channel retail terminal construction projects and omni-channel digital platform construction projects.
According to industry analysts, a major reason why the child King's fundraising failed to achieve his wishes was affected by the performance of 2021. Relevant data show that the net profit of Ziwang in the first nine months of 2021 is expected to decline year-on-year, and the net profit is expected to be 220 million yuan to 270 million yuan, down 15.03% from the same period last year.
For the decline in net profit, Wang Wang explained in the announcement that this is because of the implementation of the new lease standard from January 1, 2021. This self-standard would increase depreciation and related finance costs. The new recognition of right-of-use assets and lease liabilities on this standard is different from the previous one, and the net profit for the first nine months of 2021 is expected to increase by only 0.42%.
The slowdown in the pace of this net profit has long been signed. From 2017 to 2019, Child King achieved rapid growth, according to the prospectus information disclosure, from 2017 to 2020, child King's operating income was 5.235 billion yuan, 6.671 billion yuan and 8.243 billion yuan, and net profit was 93.79 million yuan, 276 million yuan and 377 million yuan, respectively. However, since the beginning of 2020, the growth rate of Revenue and Net Profit of Child King has slowed down significantly compared with the previous three years. In 2020, the revenue was 8.355 billion yuan, the growth rate was only 1.4%, the net profit was 391 million yuan, the growth rate was 3.7%, and the two-way growth rate was a new low in recent years.
<h1 class="pgc-h-arrow-right" data-track="11" > both store revenue and ping efficiency fell</h1>
As the chairman of the child Wang, in the 90s of the last century, he dared to give up the iron rice bowl, which can be seen that Wang Jianguo is not an ordinary person.
In 2009, Wang Jianguo opened the first store of Child King in Nanjing Hexi Wanda Plaza, which became the largest store in the world at that time. In the past 12 years, Child King has owned 500 directly operated stores, making a net income of nearly 400 million yuan.
Since its inception, Kid King has been favored by capital, and many top institutions such as Hillhouse Capital, Tencent, Dapu Capital, Warburg Pincus Investment, and Jinglin Investment have become investors in Kid King. A large part of the reason why these capitals are optimistic about the child king is because of the "big store model" of the child king.
The big store model is the business strategy of Child King, their stores are opened in super shopping malls of 100,000 square meters and above, with an average store area of 3,000 square meters, and the largest store area is more than 7,000 square meters. The child king chooses to open a big store at the expense of more rent, in order to solve all the needs of the parent-child family from pregnancy to the baby's growth process of clothing, food, housing, travel, play, teaching, learning, help, rent and so on.
But the pros and cons of this big store model are very obvious. The advantage is that the child king's store is bundled with a large commercial complex, and the child king can complete the sinking and national expansion with wanda and other super malls, and this national large-scale supermarket has become the first choice for most of the post-80s shopping and leisure, and the post-80s crowd is the consumer group of the child king, and it is also its unique channel dividend.
The disadvantage is that the rental cost of large stores is expensive. The average area of the child king's store is 2500 square meters, and the large store is often thousands of square meters, and the huge rent has brought huge cost pressure to the child king. In 2018, the rent of the Child King store was 482 million yuan, in 2019 it was 546 million yuan, and in 2020, the rent of the store was 592 million yuan, and the store rent became the largest expenditure cost of the Child King in addition to salary.
Many stores have nearly 50 million members of the child king, and the cumulative scale of the black and gold members directly reflected in the private domain traffic of the child king is also nearly 2 million people, with the largest private domain traffic in the mother and baby industry. These members and black gold members contribute more than 98% of the total sales revenue of mother and baby products.
Even if the development of e-commerce is in full swing, consumers are still more willing to choose to buy food products that are related to their children's own safety. In 3-5 tier cities, the sales of mother and baby stores account for 41% of total sales, and relevant data show that in third- and fourth-tier cities, consumers' preference for stores is more serious, and 70% of milk powder is sold by stores.
Compared with online, The Child King's stores contribute most of the revenue. However, in the past three years, the store revenue of Child King has been affected by other online maternal and infant products, and from 2018 to 2020, the store revenue has begun to decline. The average store revenue was 24.1492 million yuan, 21.5203 million yuan and 17.3281 million yuan respectively, and the average store revenue fell by 28.2% in three years. In the ping effect that best reflects the revenue of the store, the child king also has the same decline, the store ping effect in 2018 was 7855.05 yuan / square meter, in 2019 there was a slight decline, 7838.82 yuan / square meter, and in 2020, the decline was obvious, only 6878.73 yuan / square meter, down 12.2%.
For the decline in the efficiency of the store, the child Wang explained that it was affected by the epidemic. At the beginning of 2020, the store-to-store business was suspended in the first quarter. At the same time, the number of new stores opened by The Child King in the fourth quarter is relatively large, and the newly opened stores, whether it is popularity or turnover, have reduced the revenue and efficiency of the overall stores. The development of The Child King's own e-commerce platform has also reduced the revenue and efficiency of the store. According to the child king prospectus, the proportion of sales revenue of the child king e-commerce platform continued to increase, from 30.61% in 2018 to 59.15% in 2020, and now it has surpassed the store as the main source of revenue.
From the perspective of revenue structure, maternal and infant commodities have always been the first major source of revenue for Child King, and the revenue of the business rose from 6.152 billion yuan in 2018 to 7.411 billion yuan in 2019, and fell slightly in 2020, falling to 7.386 billion yuan. The proportion of revenue has gradually declined in the past three years, from 92.23% in 2018 to 88.4% in 2020. As a child king who started with maternal and infant products, there are potential concerns about the decline in the proportion of maternal and infant products.
<h1 class="pgc-h-arrow-right" data-track="23" > have money on their books but borrow heavily</h1>
In the past three years, the revenue of the child king has been increasing, but the debt has also been increasing. Liabilities surged from RMB2.025 billion in 2018 to RMB2.932 billion in 2020, an increase of 45%. For the increasing debt, the child king responded that it was caused by the continuous expansion of the child king, and the expansion was too fast so that the procurement scale remained at a relatively high level, resulting in an increase in the balance of accounts payable and bills payable.
What is puzzling is that the substantial increase in liabilities of the child king is in the case of the continuous increase of its own monetary funds, and the prospectus data shows that the child king's monetary funds have increased from 894 million yuan in 2018 to 2.031 billion yuan in 2020. Three years increased by 127.2%. This has created a strange phenomenon, the child king has a lot of cash on the account, but constantly borrowed, the prospectus shows that the child king's most important debt in 2018 is 975 million yuan of accounts payable, soared to 1.226 billion yuan in 2019, and slightly declined in 2020, still as high as 1.081 billion, accounting for 48%, 46% and 37% of the total debt of the current period, respectively. Industry insiders analyzed that from the perspective of high debt, the profit of the child king is obtained on the basis of squeezing the account period of the supplier.
He has a lot of cash, but constantly borrows, which also allows the child king to have a lot of idle funds to buy financial products. According to the prospectus, in 2019 and 2020, the trading financial assets held by The Child King were 894 million and 880 million, respectively. The move has also raised questions from many investors.
<h1 class="pgc-h-arrow-right" data-track="27" > was fined 50 cases in three years, and there were many copycat children</h1>
According to the relevant data of the seventh census, aging and low birthrate have become the biggest characteristics of Chinese institutions, even if the country liberalizes the second child, but under the high cost of education and maintenance, the fertility rate continues to decline. As a result, the birth rate of newborns in China has continued to decline, falling to 10.48 ‰ in 2019. Related professional predictions predict that as China's economy becomes more and more developed, China will be close to the low fertility rate of Western developed countries. Data show that China's population born in 2020 has dropped by nearly 30% compared with 2014, while China's current maternal and infant market size has increased by more than 136.9%. For the child king who is rooted in the maternal and infant retail industry, it will also be affected to a certain extent. This has also become a potential business risk for the long-term development of the child king. The three-child policy is still relatively vague, and many parents have an exclusionary attitude towards the three-child, which also casts a shadow on the future development of the child king.
Mother and baby products have special industry characteristics, and consumers pay special attention to the quality and safety of such products. In this regard, Wang Jianguo has formulated a number of norms, standards and methods, which make the child Wang look like he has a relatively complete quality management system. But in fact, in the past three years, the child king has received as many as 50 administrative penalties. They are 22 in 2018, 12 in 2019 and 16 in 2020.
Tianyancha data shows that dozens of penalties are due to the sale of substandard goods. On the black cat complaints of another major consumer complaint platform, there were 219 complaints about the child king, which involved product quality, counterfeiting, false publicity and other aspects, and consumers were most concerned about the "selling fake" complaints.
This also caused the potential risk of the child king, the child king also admitted in the prospectus, if you can not continue to control the quality and safety of the product, it will cause the loss of customers and orders to the child king, and then affect the performance of the child king itself.
Through the data of Tianyan, it can be found that the child king is deeply involved in the whirlpool of litigation, with many legal proceedings and court announcements. Among them, trademark infringement and disputes are the mainstay. Although the child king is mostly the plaintiff, but many trademark disputes, still show that the child king is gradually encroached on by many "copycat child king", under the overall market is in a downward trend, a large number of emerging "Li ghost" further compress the profit margin of the child king, becoming another hidden worry on the child king.
In addition to the encroachment market of many "copycat child kings", the child king also faces direct competition from competitors such as the baby-friendly room and the baby-friendly island of the small shop model. The optimism of Internet giants such as JD.com on the maternal and infant market is destined to face greater challenges and competition. In April this year, the first store of Jingdong Mother and Baby Shop Jingxi Baby opened in Chengdu, which marked Jingdong's real entry into the mother and baby market. JD.com's strong traffic allowed Jingxi Baby to receive nearly 500 members within 1 hour of opening, while this Jingxi Baby store was only 150 square meters.
In the face of such a deep supply chain advantage and strong traffic of the opponent, the future competition of the mother and baby track will be more intense, and although the child king is in the leading position, once Jingdong makes force on the mother and baby track, the child king may not be its opponent.
#孩子王 #
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