After several suspensions, the IPO of this cross-border blockbuster was "suspended" again...

"The issuer needs to combine the liabilities, external guarantees and specific solutions of Taotao Group and its actual controller to explain whether Taotao Group directly or indirectly transferred funds to Cao Matao and Cao Xiashu, and at the same time transferred part of its assets and businesses to the issuer with the intention of evading debts or guarantee responsibilities, and whether the issuer was caused by Taotao Group and its actual controller..."

On October 22, 2021, Taotao Automobile, a cross-border seller with a sales volume of 100 million yuan, was suspended from review by the GEM Listing Committee. At the review meeting of the Listing Committee, questions were raised about the rationality of the investment of Taotao Automobile's family-owned enterprises, the identification of the actual controller, and the proportion of export revenue.

The listing process was put on hold again, and Taotao Automobile's journey to the listing has been full of twists and turns.

Pause button pressed again? The "twists and turns" of Taotao Automobile's listing

On September 30, 2021, the issuance and listing review of two cross-border online retailers, Suntech Power and Zhiou, was suspended. According to the reasons disclosed by the Shenzhen Stock Exchange, the reason why the listing review of these two online retailers was suspended was that the financial information recorded in the IPO application documents had expired and needed to be supplemented and submitted.

It is noteworthy that Taotao Automobile, a low-key cross-border big seller whose listing is in a suspended review status, has also been suspended from listing more than once because of "expired financial information".

Yien.com learned that Taotao Vehicle is a high-tech enterprise that focuses on the research, development, production and sales of motor vehicles, electric vehicles and their accessories and supplies for outdoor leisure and entertainment and short-distance transportation. Taotao Vehicle sells its products to dozens of countries and regions such as the United States, Canada, Mexico, and Germany in the model of "mainly selling its own brand and combining it with ODM sales" . The sales amount in North America, especially the United States, is relatively high, and the sales revenue in the United States accounts for more than 60% of the company's main business revenue .

On July 24, 2020, Taotao Automobile's listing plan was officially accepted. On September 14, 2020, Taotao Automobile took the initiative to apply for suspension of the issuance and listing review procedures due to the need to update financial information. On November 26 of the same year, Taotao Automobile finally completed the update of financial information, and the Shenzhen Stock Exchange resumed its issuance and listing review.

What is unexpected is that Taotao Automobile has been stuck in the listing review stage.

On April 1, 2021, the Shenzhen Stock Exchange suspended the review of Zhejiang Taotao Automobile Co., Ltd.'s IPO application because the financial information recorded in the IPO application documents had expired and needed to be supplemented . On June 8, 2021, Taotao Automobile completed the update of financial information and regained the qualification for IPO review.

On September 27, 2021, Taotao Automobile Industry once again voluntarily applied to suspend the issuance and listing review procedures on the grounds of updating financial information. It was not until the financial information update was completed on October 8, 2021 that the Shenzhen Stock Exchange resumed the issuance and listing review.

Shortly after the listing review was resumed, on October 22, 2021, Taotao Automobile's review was suspended by the GEM Listing Committee, which means that Taotao Automobile's road to listing has been put on "pause" again.

Taotao Automobile is also the 11th company whose review has been suspended since 2021. According to the disclosure, the GEM Listing Committee raised several inquiries to Taotao Automobile, one of which is that Taotao Automobile's export revenue accounts for more than 99%, and it is required to explain the response measures to trade frictions and the impact of the epidemic in combination with industry characteristics, product characteristics and sales models.

It is reported that since Taotao Automobile's GEM IPO application was accepted, Taotao Automobile has responded to three inquiries from the Shenzhen Stock Exchange in November last year, July and September this year, involving "26 questions", "8 questions" and "12 questions"...

A new round of inquiries is coming again. Will Taotao Automobile, which has been suspended for review, miss the chance to go public?

According to relevant rules, the IPO suspension review period shall not exceed two months. It is reported that suspension of listing is a common situation. The Listing Committee believes that there are still some things that have not been explained or resolved, and cannot directly give an approval or rejection opinion. The issuer needs to explain and resolve them before making a decision.

Taotao Automotive: A big seller on both Amazon and independent websites

Public data shows that Taotao Automobile's revenue mainly comes from foreign sales. During the reporting period, the main business income was distributed by sales channel as follows:

Online sales are an important part of Taotao Auto's main business income, and online sales are divided into sales on its own websites and sales on third-party platforms. Third-party websites mainly include Amazon in the United States, Amazon in Canada, Amazon in Japan, and e-commerce platforms such as NEWEGG, EBAY, and Walmart Online Mall in the United States . During the reporting period, the sales and proportion of each platform are as follows:

In the first half of 2021, Taotao Auto's sales on its own website and Amazon and other websites exceeded 100 million yuan, reaching 146 million yuan. Among them, Taotao Auto's sales through Amazon's website reached 84.8896 million yuan, which far exceeded the 53.6751 million yuan for the whole of 2020. It is worth noting that from January to June 2021, Taotao Auto's sales on Amazon Canada, Amazon US and Amazon Japan were 60.3947 million yuan, 20.1255 million yuan and 3.3707 million yuan respectively.

It is reported that Taotao Automobile Industry established the Shenzhen Baike cross-border e-commerce team at the end of 2019, which is mainly responsible for the operation of Amazon's online sales platform overseas. With the continuous maturity of Amazon's online sales channels in the United States, Canada, Japan and other countries, and the continuous increase in customer traffic, the company's sales revenue increased by 74.7016 million yuan from January to June 2021 compared with the same period last year, accounting for 16.90% of the increase in operating income.

In addition to third-party platforms, Taotao Auto's own website sales performance is also remarkable. In the first half of this year, Taotao Auto's own website revenue reached 58.83 million yuan. The content, amount and proportion of Taotao Auto's own website sales products are as follows:

Taotao Automobile's own website promotion methods mainly include placing advertisements on mainstream US search engines and social networking sites such as Google, Microsoft and Facebook, and hiring third parties to design and promote the company's products and websites. The details of Taotao Automobile's advertising and marketing expenses are as follows:

It can be seen that the advertising and promotion expenses of Taotao Automobile's own website remained stable, about 10 million yuan each year from 2018 to 2020, and about 6 million yuan from January to June 2021. From 2018 to 2020, as the sales revenue of its own website increased, its proportion showed a downward trend.

The sales and net profit margin of Taotao Automobile's own website and third-party websites are as follows:

During the reporting period, the return amounts and return rates of Walmart and Amazon are as follows:

It can be seen that Taotao Automobile’s return amount on Amazon in the first half of this year reached 14.4 million yuan, and the return rate reached 8.82%.

Taotao Automobile Industry stated that the return and exchange policies of Walmart and Amazon will not affect the company's cooperation with them. The company has a good cooperation with Walmart and Amazon. Specifically, the scale of sales to Walmart has increased year by year, from 23.93 million yuan in 2018 to 187.7362 million yuan in 2020 ; the company's cooperation with Amazon has deepened, and it has transformed from "platform-style" sales to "buyout-style" sales, with sales increasing from 119.303 million yuan in 2018 to 127.3766 million yuan in 2020 (including buyout sales and platform-style sales).