Net profit in the first quarter increased by 148.69%, Zhejiang Dama successfully passed the review!

As an important tool in daily production and life, power tools are widely used in European and American households. With the expansion of power tool application areas and the increase in market penetration, sellers in this industry have also ushered in rapid development, and some sellers have begun the road to capitalization.

According to the results of the 45th review meeting of the Shenzhen Stock Exchange's ChiNext Listing Committee in 2022, Zhejiang Pulide Electric Appliance Co., Ltd. meets the issuance conditions, listing conditions and information disclosure requirements. Its current review status on the Shenzhen Stock Exchange's ChiNext has been changed to approved by the Listing Committee meeting.

Many products have reached BSR, and Zhejiang's best-selling products have successfully passed the review!

Zhejiang Pulide Electric Co., Ltd. is an enterprise engaged in the research and development, design, production and sales of power tools. Its products cover six major product series including electric heating, spraying, nail guns, blowing and suction, punching and grinding, and steam. They are mainly used in home decoration, garden maintenance and other scenarios.

Among them, spraying products account for half of Pride's main business. In 2021, Pride's spraying products achieved revenue of 282 million yuan, accounting for 42.25% of the main business revenue. In addition, electric heating, nail guns, blowing and suction and other products accounted for 36.81%, 11.37%, 7.03% and 0.86% respectively.

Pride's products are mainly exported, and its foreign markets are mainly concentrated in Europe, America and Asia-Pacific. In 2021, Pride's export sales accounted for 61.46% , of which the Americas accounted for 53.69% and Europe accounted for 33.20%.

In terms of sales model, Pride is committed to achieving dual-drive of "ODM+OBM" business. On the one hand, it continuously improves product advantages to meet the purchasing needs of world-renowned brands and retailers and continuously develops ODM business. On the other hand, it actively promotes its own brands and gradually develops OBM business to enhance brand value.

At present, Pride's ODM business is growing steadily, and its OBM business has also achieved a significant increase. In OBM e-commerce channel sales, Pride mainly cooperates with third-party platforms such as Amazon and Alibaba for sales. Among them, Amazon has the highest sales share in OBM e-commerce channels. In 2021, Amazon's sales on Pride's third-party platforms accounted for 89.12%.

Through these third-party e-commerce platforms, PRULDE's own brands such as "Hengdong", "NEUMASTER", "PRULDE" and "Bonta" have also developed rapidly. On the Amazon platform, NEUMASTER and PRULDE have multiple links with more than 1,000 reviews, and some of their products have even made it onto the Amazon Best Seller list.

Net profit doubled, Pulai's revenue data was impressive

With the rapid development of the company's business, Pride's revenue data in recent years is also very impressive. From 2019 to 2021, Pride's operating income was 295 million yuan, 392 million yuan and 673 million yuan, respectively, with an annual compound growth rate of 51.05%. Net profit also increased from 36.8388 million yuan in 2019 to 95.1583 million yuan in 2021.

In the first quarter of 2022, Pulai's net profit doubled. Data showed that in the first quarter, Pulai achieved operating income of 162 million yuan , an increase of 42.19% over the same period last year ; net profit attributable to the parent company's owners was 25.3972 million yuan, an increase of 148.69% over the same period last year.

Pride said that the main reason for the revenue growth in the first quarter was the continued growth in downstream market demand in the power tool industry and the deepening of cooperation with internationally renowned customers, while the exponential growth in net profit was due to many factors, including :

(1) Rapid growth in gross profit and operating income;

(2) With its competitive advantages, it effectively transmitted the pressure of rising raw material prices . As commodity prices gradually stabilized and fell, the gross profit margin level in January-March 2022 increased compared with the same period;

(3) Continue to develop high-quality customers and strengthen the management of accounts receivable collection . Good customer collection has reduced the bad debt loss of accounts receivable by RMB 1.1507 million from January to March 2022 compared with the same period, further improving the company's profitability and profit quality.

Pride also made an optimistic forecast for its revenue from January to June 2022 , expecting to achieve operating income of 348-380 million yuan in the first half of the year, a year-on-year increase of 18.82%-31.11%. At the same time, the net profit attributable to the parent company will be 54-60 million yuan , a year-on-year increase of 65.39%-83.88%.

The rapid growth of Pride's revenue is inseparable from the increase in market demand in the industry. It is revealed that as of the end of June 2022 , the amount of orders on hand for Pride's main products was 204 million yuan . The order volume on hand is sufficient , and Pride's future operating income is expected to continue to grow steadily.

Plans to invest 630 million yuan to expand the scale of power tool production

The power tool industry emerged in developed countries in Europe and America. Currently, North America and Europe are the main sales markets for power tools, accounting for 38.65% and 32.39% of the global market respectively. As the penetration rate of power tools continues to increase , the global power tool market size is expected to accelerate .

According to Markets and markets data, the global power tool market size in 2021 was US$34.3 billion. It is expected to continue to show a steady growth trend at an average annual compound growth rate of 5.7% in the future, and will reach a market size of approximately US$45.2 billion in 2026. The market prospects are broad.

With the continuous development of lithium battery technology, lithium-ion power tools, which are long -lasting , lightweight and comfortable to operate, are gradually replacing traditional AC products. At the same time, in order to accelerate industrial transformation and innovation-driven development, improving the degree of automation in production and manufacturing has become an inevitable choice for the development of the industry.

As the industry development trend changes, Pride is also expanding production to meet market demand. The prospectus revealed that Pride's expected financing amount for this IPO is 560 million yuan . After deducting the issuance costs, the actual raised funds will be invested in the construction of the "annual production of 8 million DC lithium-ion power tools project" . The total investment amount of the project is 630 million yuan, and Pride will solve the funding gap by raising funds on its own.

By investing in digital production lines and building an intelligent factory that can produce both alternating current ( AC) and lithium battery (DC) power tools, the project can enhance the production capacity and quality level of Pride's power tool products, further improve production efficiency, and adapt to the needs of future core business development.

Pride is continuously improving and enhancing product performance, designing and developing new products, and actively extending its power tool product line to meet the needs of well-known domestic and foreign brands . At the same time, it is actively developing its own brand to enhance its industry status and influence.

In future development, Pride said it will start from several aspects, such as " increasing technological innovation and business expansion ", "strengthening the intelligent transformation of production technology", "building new intelligent factories to meet production capacity needs", and "strengthening talent introduction and training" to enhance its own competitive advantages and ensure long-term development.

The successful listing of Pride means that it has taken one step closer to going public. If it can be successfully listed, Pride’s market influence and international reputation will be further enhanced!

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