Following the listing of Coase shares and Huaye Spice, another spice company hit the IPO.
Founded in 1999, Green Biologics is one of the well-known enterprises in the international fragrance and flavor industry. The company, which was listed on the New Third Board in November 2015 and terminated in June 2020, plans to register on the Growth Enterprise Market of the Shenzhen Stock Exchange in the near future. On December 18, the IPO application of Green Bio-CHINext was accepted, and the expected amount of financing was 330 million yuan.
Green Biology is mainly engaged in the research and development, production and sales of bio-derived fragrances and synthetic fragrances, the company's products are mainly used as raw materials for the preparation of daily chemical flavors, which are widely used in the field of daily chemicals, the main products include methyl cypress ketone, methyl cypress ether, sandalwood 208, sandalwood 210, butyl turkone, etc., has formed a pattern of common development of cypress oil, turpentine and total synthesis of three series of products.
After more than 20 years of development, Green Bio has developed a series of spices with ambergris, rose, sandalwood and other aromas. At present, Procter & Gamble, Givaudan, Firmenich, Dezhixin and other industry leaders are its cooperative customers.
Revenue in the first half of the year was nearly 300 million
The prospectus shows that from 2017 to the first half of 2020, with the continuous growth of downstream market demand, the market development efforts continue to increase, the production and sales of various series of spice products are booming, the overall sales revenue of Green Biology shows an upward trend, the total order volume continues to increase, and the operating income and profitability continue to increase.
During the period, Green Bio's revenue was 421 million yuan, 515 million yuan, 567 million yuan and 295 million yuan, showing a stable growth trend. In terms of net profit, in the first half of 2020, its scale exceeded that of 2017 and 2018.
Cut from prospectus
At present, the three series of products of asphalt oil, turpentine and full synthesis are the main sources of green biological main business income, accounting for more than 95% of the total revenue.
Compared to comparable companies in the same industry disclosed in the prospectus, Green Bio's fragrance business has the highest revenue, nearly twice the average. From 2017 to June 2022, the revenue of Green Biologics' fragrance business was 421 million yuan, 515 million yuan, 567 million yuan and 295 million yuan respectively, which was always higher than that of Aipu shares, Coase shares, Huaye spices and Yaxiang shares that had landed in the A-share market.
But among the A-share spice listed companies, Green's biomass is not the largest. It is understood that the revenue scale of new synthesis and Qingsong shares is greater than that of Green Biology, taking new synthesis as an example, its revenue in 2019 is 7.621 billion yuan, of which the income of spices and flavors reaches 1.793 billion yuan.
According to the "2017 China Light Industry And Spice Industry Top Ten Enterprises" list issued by the China Light Industry Federation, Green Biology ranked fourth.
More than 10 years of cooperation with Procter & Gamble/ Givaudan / Firmenich, etc
According to the prospectus, at present, Green Bio is the global leading registered enterprise of REACH of 5 products such as methyl cypress ketone, cypress brain, dihydrocoumarin, etc., is one of the world's largest suppliers of methyl ketone, and is one of the main producers and suppliers of synthetic sandalwood in the world.
In mature markets such as North America and Europe, Green Bio has established stable sales channels and opened up emerging Asian markets such as India and Indonesia. According to the prospectus, the company's main business income mainly comes from overseas, accounting for about 84.00% of the main business income, accounting for a relatively high proportion.
It is reported that the downstream customers of Green Biology are mainly the top ten international fragrance and flavor companies, international consumer goods companies and large international traders in the chemical field, and have cooperated with internationally renowned enterprises such as Procter & Gamble, Givaudan, Firmenich, and Dezhixin for more than 10 years.
In the first half of 2020, Givaudan, IFF and Dezhixin were the top three customers of Green Biologics. Among them, The revenue contributed by Givaudan accounted for 19.85% of the company's total revenue, and from 2017 to the first half of 2020, Givaudan has been the largest customer of Green Biologics. However, the prospectus said that Green Bio did not rely heavily on a small number of customers, and there was no situation during the period when the proportion of sales to a single customer exceeded 50% of the total sales of the current period.
Anchor the 60 billion flavor and fragrance market, and 60% of the funds raised are used to expand production
The prospectus shows that the spices produced by Green Bio are mainly used in cosmetics, detergents and other daily chemicals industry, with the rapid development of the downstream industry and the continuous expansion of the application field, in the future for a long time, the consumption of daily chemical spices will continue to grow steadily.
QYResearch data shows that between 2016 and 2019, the compound growth rate of the national spice and flavor market size was 4.38%, showing a good development trend. In the future, in the context of China's sustained economic growth, rapid development of downstream industries, and continuous expansion of internal demand, the fragrance and flavor industry will usher in a new round of growth, and it is expected that by 2024, the sales scale of China's flavor and flavor industry will reach 9.725 billion US dollars (about 63.6015 billion yuan).
Such industry capacity may be the main driving force to stimulate cosmetic raw material manufacturers, especially flavor and fragrance companies, to continuously impact IPOs. Since the beginning of this year, Coase shares and Huaye Spice have been listed, and Tianmei Bio is also seeking to land on the NASDAQ in the United States.
In order to make the market more competitive, in recent years, Green Bio has continuously increased investment in research and development. From 2017 to the first half of 2020, its R&D expenses were 0.159 billion yuan, 0.171 billion yuan, 0.225 billion yuan and 0.082 billion yuan, respectively. In 2019, the direct investment in research and development increased by 68.33% compared with 2018, higher than comparable companies in the same industry such as Coase Shares, Yaxiang Shares, and Huaye Spices.
According to the plan, Green Biology intends to raise 330 million yuan this time, and more than 200 million yuan of the raised funds will be used for the transformation and upgrading project of 5182 tons of high-grade spices with an annual output and a new project with an annual output of 3500 tons of high-grade spices.
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