Sales of 600 million in one year, Shenzhen’s big seller is about to go public!

Recently, there was news that Shenzhen Aoni Electronics Co., Ltd.'s GEM IPO registration application was approved.

On the evening of December 15, Aoni Electronics disclosed its issuance announcement, and will accept subscriptions on December 17. The stock code is "301189" and it will be listed on the Shenzhen Stock Exchange's ChiNext.

Selling 600 million in one year , big seller vs. supplier? Its true identity is...

As a veritable Amazon camera seller and a supplier of ZEBO , Oni Electronics has finally taken another step forward.

In 2005, desktop computers dominated the market, and it was during this period that Aoni Electronics was formally established. Initially, Aoni Electronics targeted PC/TV external cameras , while also acting as an agent and distributor for products such as mice and keyboards . Aoni Electronics boarded this express train and moved forward steadily.

Until 2010, the explosion of mobile Internet had a great impact on traditional PC Internet, including Aoni Electronics. Aoni Electronics began to expand its business scope and found products with the same core technology, such as Bluetooth headsets and smart speakers , and the migration cost was not high. In the following years, Aoni Electronics continued to innovate and cooperate with third parties to achieve a sharp increase in revenue.

However, what really brought spring back to Aoni Electronics was the arrival of the epidemic. During the epidemic, people worked and studied at home, which led to a surge in demand for PC/TV cameras, which was directly reflected in Aoni Electronics' main business revenue in 2020. Data shows that from 2018 to 2019, Aoni Electronics' PC/TV external camera revenue was around 50 million yuan, but in 2020 this figure soared to 609 million , a huge span.

The sales data of this company, which started out as a camera company, is indeed impressive, but "big seller" is not its only identity. Another identity is "supplier". In 2020, Aoni Electronics supplied 100 million yuan to Linyoutong, a subsidiary of Zebao, and tens of millions of yuan to Qihoo 360. It is worth mentioning that some of Linyoutong's products, including "Uspicy", "Anjou" and "TaoTronics" , are from Aoni Electronics.

At present, Aoni Electronics has two business models : " OEM factory " and " own brand ". ODM customization accounts for about three-quarters of revenue, and own brand revenue accounts for about one-quarter. Under the ODM customization model, it is subdivided into " customized ODM " and " menu-based ODM ". Among them, customized ODM customers have stronger stickiness, which is more beneficial for Aoni Electronics to improve its technology and manufacturing capabilities.

The epidemic "assists" PC/TV cameras to become the focus of business

Whether it is "customized ODM" or "menu-based ODM", it is ultimately the identity of a supplier. Under the supplier system, the company's bargaining power is low and the premium space is small.

According to the financial report, from 2018 to 2020, the annual revenue of Aoni Electronics increased from 295 million to 1.084 billion, with an average annual compound growth rate of 92.96%, almost doubling every year. Net profit increased from 2.59 million to 193 million, an increase of more than 70 times. In terms of profit margin, the net profit margin was less than 1% in 2018, 10% in 2019, and rose to 17.8% in 2020.

Judging from the specific composition of revenue, the PC/TV external camera business mentioned above still contributes the most to Aoni Electronics' revenue . Sales have soared from more than 40 million to about 600 million, an increase of nearly 13 times, and its share of overall revenue has also increased from 15.16% to 56.99% .

In addition to the PC/TV external camera business, the revenue of other businesses also increased, but the growth rate was far lower than that of the external camera business. Among them, the revenue of smart audio terminals grew slowly, and the revenue of the speaker business also fell sharply.

In Oni Electronics' online sales channels, changes in sales trends are close to the overall business trends. The growth in business share mainly depends on the growth in PC/TV camera sales, among which overseas PC/TV camera revenue accounts for more than 60% of the overall online revenue.

PC/TV external cameras have become the main business driving revenue growth from a business close to the "fringe". The epidemic has been a great help to Aoni Electronics. However, this business that has achieved explosive growth due to the epidemic is destined not to last too long. In the first half of 2021, the revenue share of PC/TV external cameras has declined to 48.63%.

Judging from the purpose of the funds raised by Oni Electronics this time, the funds raised will be mainly used for the construction of intelligent video and audio production lines, the construction of intelligent audio and video product R&D centers, brand building and marketing channel upgrade projects.

It can be seen that in the next step of planning, in addition to continuing to expand production lines, Aoni Electronics will continue to invest in R&D, brand building and marketing channels. However, as far as the current situation is concerned, Aoni Electronics' R&D expenses have been shrinking, from 8.01% in 2018 to 5% in the first half of this year. Aoni Electronics' next development plan remains to be verified.

Raw material costs account for more than 80%, and the risks of Aoni Electronics are increasing

Judging from its overseas sales data, in addition to offline sales, Aoni Electronics' overseas online business is mainly carried out on Amazon and AliExpress, and Amazon is its main source of income. Among them, in the first half of 2020, Aoni Electronics' sales on Amazon were 39.4167 million yuan, accounting for 69.46% ; sales on AliExpress were 2.0504 million yuan, accounting for 3.61% of sales.

In addition, affected by many factors, Aoni Electronics' business also faces several major risks. In terms of cost, the rise in bulk raw material prices has a great impact on the cost of enterprises, and Aoni Electronics is no exception. In the first half of 2020, the proportion of Aoni Electronics' raw material costs in its main business has reached 80.10%. If the market prices of major raw materials fluctuate significantly in the future, the company's profitability is likely to be affected.

In the first half of 2021, affected by various factors, the raw materials necessary for Oni Electronics, such as semiconductors and electronic components, also showed tight supply and demand, which affected its costs and reduced the gross profit margins of products such as cameras.

In terms of business, the company's overseas business has covered many regions including the United States and Europe. In the first half of 2020, the company's overseas sales accounted for as much as 52.76% of its main business during the period . If there are turbulence and repeated epidemics, it will affect the company's production and operations.

In terms of accounts receivable, the book value of the company's accounts receivable in the first half of 2020 was 52.134 million yuan, accounting for 12.13%. Under this circumstance, if the customer's financial situation changes significantly, it will easily cause bad debts and affect the company's performance.

In general, in this year's capitalist market, many companies have chosen to rush for IPOs to speed up their capitalization process after their performance has soared , but the results are often very different. Some sellers have successfully rushed for IPOs, with their stock prices soaring, while others have been forced to interrupt their IPOs. For sellers, it is particularly important to reasonably grasp the current situation and choose a suitable development path for the development of their companies and cross-border e-commerce businesses.

Aoni Electronics

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