Starting from 100,000 and making 1.3 billion! The IPO passed the review, but still faces many risks

Life has its ups and downs, and so does the journey across borders.

Pinduoduo Temu's fierce attack on the low-price market has caused a great impact on the sellers. Against this background, the cross-border seller Yibai Network still performed well and achieved a comeback in 2022!

In the past year, many new IPOs have emerged in the cross-border industry. The good news has been a great boost to the morale of small and medium-sized sellers in our cross-border industry.

Big sales hit bottom and rebounded in 2022!

This company's profits soared by 13164.32%!

As a well-known distributor in the industry, Yibai Network has been continuously iterating its business model, transforming from the initial "human sea model" to a technology-driven troika - "general products + high-quality products + comprehensive services". Facts have proved that such drastic reforms are correct and effective.

Recently, Yibai Network's parent company Huakai Yibai released an announcement of its 2022 performance forecast. The announcement mentioned that in 2022, Huakai Yibai's net profit attributable to shareholders of listed companies will be around 210 million yuan to 240 million yuan , and the loss in the same period last year was 87.4038 million yuan; the net profit after deducting non-recurring gains and losses in 2022 will be around 190 million yuan to 220 million yuan , and the loss in the same period last year was 99.3910 million yuan.

Source: Huakai Yibai 2022 Performance Forecast

It can be seen that Yibai Network has made progress in three dimensions: pan-category, branding, and technology middle platform, and has continuously strengthened and refined its main business of cross-border e-commerce, and has now achieved a phased victory. Furthermore, according to the announcement, Huakai Yibai will be able to achieve a substantial increase in overall operating performance in 2022, benefiting from the forward-looking strategic layout of the core management team of the company and its holding subsidiary Yibai Network, and continuously improving its own operating level.

The most important point is that its subsidiary Yibai Network bottomed out and rebounded in 2022 due to the very favorable overall environment of cross-border e-commerce, including a sharp drop in freight rates, a rebound in the US dollar exchange rate, gradual inventory clearance, and a significant improvement in the industry's competitive landscape .

I believe that many sellers have also deeply experienced the improvement of the overall environment. Another listed big seller , Chuangyuan Culture , also stated in its recently released 2022 performance forecast that the net profit attributable to shareholders of the listed company in 2022 will reach 63 million to 94 million yuan, and the net profit after deducting non-recurring gains and losses will reach 55 million to 82 million yuan, an increase of 8796.80% - 13164.32% over the same period last year!

Source: Chuangyuan Culture 2022 Performance Forecast

This data is also quite gratifying. According to its announcement, Chuangyuan Culture was able to achieve a leap in performance. In addition to strictly implementing quotations according to the quotation model, strengthening cost management, strengthening product line thinking, and increasing product added value , it also benefited from the appreciation of the US dollar against the RMB. It can be seen that when doing cross-border e-commerce, the impact of exchange rates cannot be underestimated.

So, what are the aspects of the annual reports of the listed companies that are worth learning from? The "veil" will be unveiled soon, and then we will discuss it in detail.

There is continuous good news about cross-border IPOs.

The risks behind this cannot be ignored!

At the beginning of the new year, there have been many exciting news in the cross-border circle. Many sellers have also been "advanced" on the road to IPO and become new cross-border stars.

On January 6, Shenzhen Greenlink Technology Co., Ltd. (hereinafter referred to as "Greenlink Technology") met the issuance conditions, listing conditions and information disclosure requirements, and its IPO was successfully approved! According to the prospectus, Greenlink Technology is mainly engaged in the research and development, design, production and sales of 3C consumer electronic products, and its products mainly cover five major series: transmission, audio and video, charging, mobile peripherals, and storage.

In its prospectus, it is mentioned that the operating income in 2022 is expected to be 3.799 billion yuan to 3.93 billion yuan , a year-on-year increase of 10.23% to 14.01%. The net profit attributable to the parent company's shareholders is expected to be 323 million yuan to 346 million yuan, a year-on-year increase of 8.87% to 16.76%. The revenue scale and profitability level continue to maintain a growth trend.

Image source: GreenLink Technology IPO prospectus

This successful review means that UGREEN Technology is only one step away from ringing the bell for its IPO. Originated from Huaqiangbei, UGREEN Technology, which started as a humble charging cable, has finally arrived at the IPO gate after 13 years of establishment. Looking back over the past 13 years, UGREEN Technology started from OEM production of data cables for foreign customers, to branding, and gradually expanded its business platform and product categories. Now, UGREEN Technology has annual sales of nearly 4 billion and is continuously favored by capital. Every step is quite magical. Of course, there are always risks in business operations. Its prospectus shows that UGREEN Technology faces the following risks:

• Online platform operating risks

• Risk of intensified market competition

• Risk of changes in overseas business environment

• Risks of developing new technologies and new products

• Inventory management risks

• Risk of defects in the leased property

During the reporting period, the revenue of GreenLink's main business realized through online e-commerce platforms accounted for 82.41%, 82.35%, 78.14% and 77.04% respectively. Among them, GreenLink Technology faces the risks of sluggish sales, inventory backlogs and inventory depreciation in its operations on Amazon, an overseas sales platform, and these factors will seriously affect the company's ability to realize cash and financial status. This is also a cause for concern for us small and medium-sized sellers. As cross-border e-commerce sellers, it is also very important for us to grasp market demand and have the ability to prepare inventory reasonably.

Greenlink Technology was in the lead, followed by Shenzhen Reolink Technology Co., Ltd. ("Reolink"), which also successfully passed the IPO on January 8 and is about to be listed on the Shenzhen Stock Exchange Main Board! The prospectus mentioned that the company is mainly engaged in the research and development, production and sales of home video surveillance product hardware and software under its own brand "Reolink", with online platforms as the main sales channel, focusing on the overseas consumer market.

According to its prospectus, from 2019 to the first half of 2022, Ruilian Technology's operating income was 524 million yuan, 960 million yuan, 1.367 billion yuan, and 707 million yuan, respectively, and the main business revenue grew very rapidly.

You should know that the founders of Ruilian Technology, Liu Xiaoyu and Wang Aijun, previously worked at Huawei HiSilicon Semiconductor. After leaving, they founded the company with an initial registered capital of only 100,000 yuan , but now the revenue is far more than 100,000! According to its prospectus, in the first half of 2022, the main business revenue exceeded 700 million yuan, and the main business revenue in 2021 exceeded 1.367 billion yuan !

Image source: Ruilian Technology IPO prospectus

Of course, Ruilian Technology also faces many risks, including internal control risks, financial risks, legal risks, operational risks , etc. A very important point in the operational risks is that Ruilian Technology has a high sales concentration on the Amazon platform. It is mainly sold through online channels such as Amazon, eBay, AliExpress, and official websites. Among them, the sales through the Amazon platform accounted for 65.00%, 67.90%, 63.80% and 67.06% of the total product sales revenue from 2019 to the first half of 2022, which is relatively high.

In summary, both UGREEN and Ruilian face the same risk, which is their high reliance on online platform operations .

Faced with a series of operational risks, it is very necessary for Ruilian Technology to expand sales channels, broaden sales markets, maintain product updates and technological innovation, and avoid operational and cargo management risks. This is also the way for Ruilian Technology to develop in the field of cross-border e-commerce in the long run.

The miracle of the stupid kid actually happened to Zhang Qingsen of UGREEN Technology, and Liu Xiaoyu and Wang Aijun, founders of Ruilian Technology. This is because the city of Shenzhen is not short of miracles, and the same is true for the cross-border e-commerce industry.

The sellers who have created miracles in the field of cross-border e-commerce have worked hard and braved the wind and rain. Let's wait and see how the future will develop!