On November 1, the Listing Committee of the Science and Technology Innovation Board deliberated and approved the initial offering application of Suzhou Nanocore Microelectronics Co., Ltd. (hereinafter referred to as "Nanocore Micro").
Nanochip's core business is the design and development of chips, the main products include signal sensing chips, isolation and interface chips, driving and sampling chips, the main products are used in information and communications, industrial control, automotive electronics and consumer electronics and other fields. Due to the development of the first high-performance three-axis MEMS accelerometer ASIC in China, Nanocore Micro is known as the first "sensor signal conditioning chip company" in China.
Standing on the cusp of the chip industry, nano-core micro looks hot, but in the eyes of many professional investors, there are multiple risks hidden inside.
Equity dispersion is the biggest hidden danger with the three types of shareholders
Equity stability has always been the focus of IPO reviews. It is not difficult to find from the prospectus of Naxin Micro that the company's equity structure is highly dispersed, and the actual controller is composed of Wang Shengyang (holding 14.60%), Sheng Yun (holding 13.60%), and Wang Yifeng (holding 5.10%).
Nanocore micro-shareholding structure, screenshot from the prospectus
With such a high degree of diversification of equity, how to ensure the stability of the company's control and standardized operation after listing?
"In the event of disagreement, Sheng Yun, Wang Yifeng and the enterprises they control (if any) shall act in concert in accordance with Wang Shengyang's opinions and shall not give up their voting rights (except where Wang Shengyang explicitly requests to give up). Wang Shengyang, Sheng Yun and Wang Yifeng jointly control the company and do not affect the standardized operation of the company. Nano-core micro is so emphasized.
But this does not dispel external doubts. Some investment bank legal counsel said: "The shareholding ratio of a single major shareholder is too low (less than 20%), while the shareholding ratio of two shareholders is also more than 10%, and it is obvious that the major shareholder does not have absolute control, which is an unstable factor for listed companies." When the major shareholders and the two shareholders agree and cooperate happily, this is not a problem; but when they have differences of opinion, the problem arises, especially if the two shareholders unite with the three or four shareholders and even some smaller shareholders, and their combined shareholding ratio exceeds that of the major shareholders, then the position of the major shareholders will be shaken, perhaps they will lose control of the board of directors, or the company will be plunged into a protracted tug-of-war for control. ”
Cases of companies being dragged down by a tug-of-war over control in the capital markets abound. The current shareholding structure of Nachi micro is also regarded by the capital market as the biggest hidden danger of its listing.
It is also worth noting that on the issue of equity, Naxin Micro also has a problem that touches the red line of the CSRC's IPO review - "three types of shareholders" holding shares.
With the gradual development of the relevant system of the registration system, the CSRC strictly investigates and explicitly requires IPO companies to liquidate the "three types of shareholders" (i.e. the direct or indirect investors of the enterprise include contractual private funds, asset management plans and trust plans). There are asset management plans among the indirect shareholders after the penetration of Nanochip Micro.
The shareholding of the three types of shareholders of Naxin Micro is screenshotted from the prospectus
The above-mentioned legal counsel of investment banks pointed out that whether it is a company system or a partnership system, due to third-party evidence such as industrial and commercial registration, organization code certificate, tax registration certificate, etc., it is easy for the regulatory authorities to verify the information of shareholders or partners and whether there are related party transactions and inter-industry competition. For example, the trustee may have multiple products and tens of thousands of customers, and whether there are potential related party transactions and benefit transmission, in fact, the regulatory authorities cannot verify it at all. According to past IPO cases, such nominee holding relationships need to be restored in addition to disclosure, but the three types of shareholders of Naxin Micro's asset management plan are obviously difficult to restore.
"This kind of holding behavior of Naxin Micro is very easy to convey benefits in the regulatory vacuum, if the three types of shareholders are not cleared enough, it may be a big stock after listing, which will have a significant impact on the stock market in the soaring and plummeting stock price operation." The investment bank's legal counsel reminded.
Or the transaction model with Huawei is questionable
It is worth noting that in the list of the company's top five customers during the reporting period disclosed by Naxin Micro, there is a rather mysterious company - customer A.
The top five customers of Naxin Micro are screenshots from the prospectus
According to the data disclosed by Nanochip Micro, information and communication products have developed rapidly in the past two years and have surpassed consumer electronics to become the company's largest product sales field; in terms of specific products, 54.3% of the revenue of signal sensing chips comes from the field of consumer electronics, 75.6% of the revenue of isolation and interface chips comes from the field of information and communication, and 49.4% of the revenue of driver and sampling chips comes from the industrial field.
However, since the fourth quarter of 2020, the original company's largest customer A has suspended placing new orders to Nanochip, or put pressure on the company's future revenue. According to people familiar with the matter, "Customer A" is a first-line manufacturer in the domestic information and communication industry - Huawei.
Regarding the cooperation model of Nachip micro and customer A, some external investors also questioned it. According to the disclosure, Nachip began to supply directly to customer A in 2018. At the same time, as the designated distributor of customer A, Aramco purchases chip products from the company in the form of a buyout and then sells them independently to customer A. The data shows that in the past three years, the direct or indirect sales revenue of Nanochip to customer A accounted for 0.36%, 29.5% and 22.98% of the total revenue, and the gross profit accounted for 0.46%, 35.92% and 25.75% respectively.
In early 2020, Customer A converted the company into a direct supplier. In the early stage of direct supply, the company completed the supply of customer A by purchasing transit services from Amerstone. According to this, some external investors questioned that under this cooperation model, it is very easy to form a secret channel for the transmission of interests between Nanochip micro and Amerstone and customer A.
In addition, in the list of the company's top five customers, in addition to customer A and its sales related parties, Nanjing Kilno and Suzhou Mingyao accounted for a relatively large proportion of sales revenue.
According to the prospectus, the gross profit margin of sales of Nanochip to Nanjing Kirno and its related parties has changed greatly in the past three years, of which the gross profit margin of isolation and interface chips increased from 29.51% to 62.83% in 2020, and the gross profit margin of signal sensing chips rose from 59.21% to 72.19%.
What is more noteworthy is that suzhou minghao, one of the large customers who has cooperated with Naxin micro for 8 years, of which the sales revenue of Suzhou minghao in 2014 and 2015 reached 83.31% and 61.83% respectively.
Combing the equity relationship can be found that the private equity fund Guorun Ruiqi holds 11.38% of the shares of Naxin Micro, Suzhou Gutechnik holds 10% of the partnership share of Guorun Ruiqi, and Suzhou Gutechnium also holds 23.99% of the equity of Suzhou Minghao.
That is to say, through the equity level, Naxin Micro and the large customer Suzhou Minghao have a common shareholder - Suzhou Gutech.
Many capital market people believe that this relationship is like that Nano-tech and Suzhou Minghao are the left and right hands of Suzhou Gutechnium, and the transaction between Nanoxin Micro and Suzhou Minghao has constituted a game of interest transmission between suzhou Gutechnium's left and right hands.
Debt soars, concealing the risk of a related guarantee detonation
Observing the financial report of Naxin Micro, some financial people in investment banks have raised concerns about its ability to continue to operate.
The prospectus discloses that although the operating income of Nanochip during the reporting period continued to grow, but its realized profit performance failed to synchronize, from 2018 to the first half of 2021, Nanochip's operating income was 40.22 million yuan, 92.1 million yuan, 242 million yuan and 341 million yuan, and the net profit was 2.31 million yuan, -9.11 million yuan, 50.91 million yuan and 89.99 million yuan, respectively.
From 2018 to the first half of 2021, the net cash flow generated by nanochip micro's operating activities was 2.92 million yuan, 8.41 million yuan, -40.56 million yuan and 23.31 million yuan, respectively. This shows that most of the net profit of Nanocore has not brought about the growth of the company's funds, on the contrary, there has been a net outflow in individual years, resulting in a shortage of funds in the company.
In addition, the sharp increase in receivables has also squeezed a lot of the company's funds. At the end of 2018 and the end of 2019, the accounts receivable of Nanochip were also 990,000 yuan and 7.56 million yuan, respectively, and by 2020 and the first half of 2021, nanochip's accounts receivable had risen to 41.97 million yuan and 93.46 million yuan.
In the context of the company's operating scale increasing year by year, its own business activities cannot provide more liquidity, so it can only be obtained through external financing. As a result, it can be found that the total number of interest-bearing liabilities of Naxin Micro, including short-term borrowings, non-current liabilities due within one year, and long-term borrowings, has soared from 2.5 million yuan at the end of 2018 to 83.67 million yuan in the first half of 2021.
From another point of view, being able to obtain a high amount of short-term loans is not unrelated to the related guarantees of The actual controller of Naxin Micro, Wang Shengyang and Hu Shuhua, and their spouses, since 2017, Wang Shengyang and Hu Shuhua have jointly provided 11 guarantees for Naxin Micro, with a maximum guarantee amount of 300 million yuan. It is the role of these related guarantees that has made a large number of short-term borrowings for Nachip.
In this regard, the above-mentioned investment bank financial sources pointed out that it is understandable that there are a large number of related guarantees before the enterprise is not listed, but after the company is listed, if there are still a large number of related guarantees between the actual controller and the listed company, it is not excluded that there may be indirect mutual insurance, serial guarantees, and the existence of secret guarantees behind them, which are the most explosive links in the guarantee of listed companies in recent years. Therefore, the related guarantee of Naxin Micro requires investors to remain vigilant, and once the guarantee risk is detonated, it will not only cause the risk exposure of commercial bank loans, but also cause huge losses to investors in the secondary market.
It is also worth noting that the trading financial assets that soared in the financial report of Naxin Micro. Trading financial assets refer to financial assets held by an enterprise for the purpose of selling in the near future, and the purpose of the enterprise holding them is short-term, and the asset impairment loss is not calculated during the holding period. For example, stocks, bonds and funds purchased from the secondary market for the purpose of earning spreads.
According to the financial report, at the end of 2020, the trading financial assets of Nachip were 1 million yuan, and by the first half of 2021, its trading financial assets had reached 20 million yuan. In this regard, the above-mentioned investment bank financial sources pointed out that enterprises hold trading financial assets in order to improve the return on funds and ensure the liquidity of funds, but this kind of investment will have certain risks, and generally speaking, enterprises will not put a special amount of funds into it. Nanochip's trading financial assets have soared 20 times in half a year, and we need to be vigilant about the risks behind them.