Great! Super seller plans to list on A-shares

At present, Anker Innovations has been listed independently, and other major sellers such as Tongtuo, Youkeshu, Jiazhilian, Zebao, and Global Easybuy have been listed indirectly. Aosen, Saiwei, Zhiou, Qian'an, etc. are also preparing for IPO. People are very curious about when Aoji, which ranks among the top sellers in the industry, will be listed. In fact, the low-key Aoji is already in the listing guidance.

Aoji is receiving IPO guidance

Public information on listing guidance filing shows that Aokia Technology Co., Ltd. plans to issue shares for the first time and be listed on a domestic stock exchange. It has now accepted guidance from Huatai United Securities and filed for guidance with the Shenzhen Securities Regulatory Bureau on August 7, 2020.

Like Anker and other big sellers, Aoji's capitalization process is very representative in the industry. In 2015, Aoji landed on the New Third Board, becoming the first cross-border e-commerce company to be directly listed in China.

In April 2019, Aoji terminated its stock listing and submitted a prospectus in September of the same year to pass the IPO on the Science and Technology Innovation Board. In 2020, Aoji took the initiative to terminate the review and withdraw the application documents. Now, Aoji plans to IPO on the Growth Enterprise Market, and the super-hot listing is of course highly anticipated.

Sales of 6.6 billion in 9 months, 3C products are the pillar of Aogi

Founded in 2010, Aukey currently has 1,963 employees. Aukey has created well-known brands such as Aukey, Tacklife, Aicook, Homfa and Naipo in the fields of 3C digital products, power tools, smart home appliances, home furnishings and health products, and sells them to the world through third-party platforms such as Amazon and eBay and self-operated platforms.

According to public information, in the first three quarters of 2020, Aoji's revenue reached nearly 6.6 billion, with a profit of about 580 million and a net profit of over 500 million. The fourth quarter is the highlight of the year's sales, and the annual sales volume cannot be underestimated. In the previous few years, Aoji's performance has also maintained rapid growth .

Previously, Aojie introduced its main business and main products in its prospectus.

The company's products are divided into two categories: branded products (own brands) and comprehensive products (other brands), each of which can be divided into three sub-categories: technology consumer products, home products, and other categories. During the reporting period from 2016 to 2018 and Q1 2019, the revenue share of branded products was 49.9%, 60.4%, 73.3% and 76.5% respectively, gradually increasing; technology consumer products accounted for more than half of the revenue, followed by home products.

1. Main brands and products:

1. Power tool brand Tacklife

Household tools are a must-have consumer product category for families in the European and American markets. Tacklife has a good brand image in the fields of handheld power tools, outdoor garden tools, woodworking tools, hand tools, and measuring tools in the European and American retail markets. Among them, the representative products of power tools are multi-purpose grinders and sanders; the representative products of measurement and starting power supplies are laser rangefinders and emergency starting power supplies.

2. Aukey, a digital 3C product brand

As an early digital 3C product brand, Aukey has achieved many high-quality product results and technical accumulation in the fields of Bluetooth technology, audio noise reduction, high-definition recording, fast charging, smart wear, etc. Specifically, it includes wireless audio equipment, energy charging equipment, car equipment (representative products are smart car chargers and smart brackets), adapters and HUBs.

3. Home health appliance brand Naipo

Naipo is an important layout of Aoji in the consumption scene of health appliances. Its products cover all scenes of personal and family life. The corresponding representative products include leg beauty machine, massage shawl, etc.

4. Small home appliance brand Aicok

The corresponding representative products include juicers, electric kettles, etc.

AUKEY's branding effect is remarkable. AUKEY has been listed in the BrandZ™ Top 50 Chinese Global Brands for three consecutive years. In the 2020 list, AUKEY ranked 35th, along with other cross-border e-commerce brands such as Anker, SHEIN, and ZAFUL.

This month, the German Red Dot Design Award and iF Design Award were announced one after another. 18 products of Auge won a total of 19 awards, including the tabletop blender which won two awards at the same time.

To date, Aoji has won a total of 49 top domestic and international design awards, including the German Red Dot Award, the German iF Award, the Taiwan Golden Dot Award, the China Red Star Award, etc., including 21 iF Awards and 20 Red Dot Awards.

2. Sales Model and Channels

During the above reporting period, Auke's specific sales models and channels included online third-party B2C platforms mainly based on Amazon , online self-operated platform B2C sales and B2B sales models.

From 2016 to the first quarter of 2019, the proportion of Aoji's online sales revenue to the company's main business revenue was 97.33%, 97.60%, 98.19% and 98.02% respectively. Among them, the sales revenue through third-party export e-commerce platforms such as Amazon, eBay and AliExpress accounted for 82.54%, 87.58%, 92.22% and 92.64% respectively. It is worth noting that during the reporting period, Aoji's sales through Amazon accounted for 49.02%, 63.39%, 72.94% and 75.64% respectively.

In the first quarter of 2019, the top five sales platforms of Aokkey are as follows, among which Amazon accounted for 75.64% of the revenue and became its main source of income.

During this period, Europe contributed 54.7% of its revenue, North America contributed 35.5%, and Asia contributed 7.6%. Europe and the United States are clearly its core markets.

Like most cross-border sellers, Aoji's main business revenue shows certain seasonal characteristics, with a higher proportion of revenue in the second half of the year, and the fourth quarter accounting for the largest proportion. From 2016 to 2018, the company's main business revenue in the second half of the year accounted for 63.4%, 59.6% and 54.6% of the total revenue respectively.

Shortcomings: Low net profit, R&D accounts for less than 2%

While continuing to move forward, Aoki still has some shortcomings.

Judging from the net profit of Aoji's public revenue, the company has been questioned by the outside world for its low net profit. From 2016 to 2018, the company's revenue was 2.195 billion yuan, 3.712 billion yuan, and 5.108 billion yuan respectively; the net profit was 103 million yuan, 191 million yuan, and 198 million yuan respectively, with a net profit margin of 4.7%, 5.2%, and 3.9% respectively.

It is worth noting that part of Aojie’s profit structure comes from tax incentives, which were RMB 11.5242 million, RMB 22.0792 million and RMB 18.5116 million in 2016-2018 respectively.

Yingqu Technology, which has a similar technology consumer electronics product portfolio to Aok, also mainly sells its products overseas. Its revenues from 2016 to 2018 were RMB 1.648 billion, RMB 3.267 billion, and RMB 2.778 billion, respectively, while its net profits reached RMB 445 million, RMB 983 million, and RMB 813 million.

The revenue of Inqu Technology is much smaller than that of Aoji, but the overall net profit is much higher. The core difference between the two is that Inqu Technology is a factory, while Aoji Technology is an independent brand. As an independent brand manufacturer, its net profit margin is lower than that of manufacturers.

In addition, Aojie's prospectus shows that the company is mainly engaged in the research and development, design and sales of its own brand of technology consumer products.

Although it claims to be technological, the proportion of R&D expenses to revenue of Aokia Technology is relatively low. From 2016 to 2018, the company's R&D expenses were 29.3275 million yuan, 63.6565 million yuan, and 76.4485 million yuan, respectively, accounting for 1.34%, 1.71%, 1.5%, and 1.49% of revenue, respectively. In the same period, Anker Innovations' proportion was about 5%.

Every company will have some problems in its development. In the future, Aoji will increase its investment in product design and research and development to promote product innovation and service innovation. At the same time, it will continuously upgrade its operating model to help its supply chain partners transform and upgrade, so that everyone in the world can enjoy the beauty brought by technological products.