Another Shenzhen cross-border company's listing was terminated! It once sold nearly 2 billion yuan of goods a year

Recently, news came from the cross-border e-commerce capital market that another company’s listing was terminated.

Shenzhen Feisu Innovation's IPO terminated

Shenzhen Feisu Innovation, which is preparing for listing on the Shenzhen Stock Exchange's main board, is shown as " terminated " in the Shenzhen Stock Exchange's project status .

It is understood that the reason for the termination of the listing is that Shenzhen Feisu Innovation and its sponsor withdrew their application for issuance and listing, and the Shenzhen Stock Exchange decided to terminate the review of its initial public offering and listing on the main board.

Shenzhen's fast-paced and innovative road to listing has been full of twists and turns.

On July 5 , 2022 , Feisu Innovation submitted its prospectus for the first time, and its sponsor was China Merchants Securities .

On February 10, 2023 , Feisu Innovation completed the pre-disclosure update .

On March 1, 2023 , Feisu Innovation’s application for listing was accepted.

According to the application materials, Feisu Innovation expects to issue no more than 41 million shares after its successful listing , with a planned financing amount of RMB 1.354 billion. The funds raised will be mainly used for park construction, platform upgrades and replenishment of working capital.

On March 21, 2023, Feisu Innovation’s listing review status on the Shenzhen Stock Exchange was updated to “inquiry has been made”.

On March 31 , 2024 , Feisu Innovation was terminated due to expired financial information.

Not long afterward, the Shenzhen Stock Exchange terminated its listing review because Feisu Innovation and its sponsor withdrew their listing applications .

Shenzhen Feisu Innovation Technology Co., Ltd. was established in April 2009. It focuses on the field of high-speed optical communications and is mainly engaged in the research and development, design and sales of core equipment and general accessories in the field of network communications. The company is headquartered in Shenzhen, China, and has subsidiaries and established warehousing and service centers in Wuhan, China, the United States, Germany, the United Kingdom, Australia, Singapore, and Russia.

(Picture from: Feisu Innovation official website )

Currently, the company's product SKUs have exceeded 80,000, covering eight major categories: network equipment, switches, optical modules and high-speed cables, fiber optic patch cords and pigtails, fiber optic wiring management, optical transmission equipment, copper cable integrated wiring, and testing instruments and tools.

The business of Feisu Innovation has expanded to more than 200 countries and regions around the world , covering industries such as communications, government, education, finance, medical care, transportation, and the Internet. Major customers include Qualcomm, SEA Group, Microsoft, Cisco, Intel, Ubisoft, Telia, Cloudflare and other world-renowned companies.

From 2009 to 2013, in the early stages of the company's development , Feisu Innovation mainly carried out export trade business of network communication products through the Alibaba platform.

In 2013 , Feisu Innovation officially built the Fiberstore digital trading platform and began the development of its own platform .

In 2015, the FS.com top -level domain name was officially launched, put into production in multilingual markets, and fully enabled the automated business system .

In 2016, the rapidly innovative Wuhan laboratory and the US storage center were officially established, and the company's performance soared rapidly .

In 2017 , Feisu Innovation began to expand into the European market and established a quality control management and R&D design system.

In 2018, the company has established five large-scale warehousing centers and three localized service centers in Europe, North America, Asia Pacific, and Australia.

In 2019 , Feisu Innovation continued to strengthen its R&D and quality control capabilities and expanded its Wuhan R&D center.

In 2020 , Feisu Innovation was officially changed into a joint-stock company. This year, it accelerated the expansion of 5G network business and product categories to meet the growing demand for 5G applications .

In recent years, Feisu Innovation has ushered in rapid development, and its performance has maintained a steady growth trend.

From 2020 to 2022 and from January to June 2023, Feisu Innovation's operating income was RMB 1.18 billion, RMB 1.582 billion, RMB 1.988 billion and RMB 1.039 billion, respectively, and the company's net profit was RMB 130 million, RMB 280 million, RMB 365 million and RMB 226 million, respectively .

The strong momentum of rapid innovation in performance development is inseparable from the company's overseas sales.

From 2020 to 2022 and from January to June 2023 , Feisu Innovation 's overseas sales revenue was RMB 1.166 billion, RMB 1.568 billion, RMB 1.974 billion and RMB 1.031 billion, respectively, accounting for 98.89%, 99.15%, 99.29% and 99.27% ​​of the main business revenue, respectively. The proportion of overseas revenue is quite high .

Feisu Innovation's self-operated independent site fs.com has more than 340,000 registered customers worldwide. From 2020 to 2022 and from January to June 2023 , the proportion of repurchase orders from Feisu Innovation's existing customers was 84.50%, 85.69%, 88.43% and 92.24% respectively. The company has established a customer cooperation system with wide coverage, high stickiness and all-round cooperation , which has been widely recognized by the market.

Rapid innovation still faces multiple risk factors

Although the market performance of Rapid Innovation is good, it still faces many risk factors in its development process.

First, the company's overseas sales revenue accounts for too high a proportion. From 2020 to the first half of 2023, the company's overseas sales accounted for more than 98.89% of the main business revenue in the current period, while the contribution of domestic sales was less than 2 %.

Feisu Innovation said that overseas sales are the main source of the company's operating income and profits. The company may face risks brought by changes in the overseas operating environment in the future, and its operating performance may fluctuate or even decline by 50 % or more. If there is political turmoil, war, unrest or changes in laws and policies in the overseas market , it will have a direct impact on the company's performance. At the same time, the company also needs to deal with the access standards of network communication products in different countries. If these standards change or undergo major adjustments, it will also directly affect the company's performance.

On the other hand, rapid innovation does not have an advantage in R&D.

From 2020 to 2022 and from January to June 2023, Feisu Innovation 's R&D expenses were RMB 81.0448 million, RMB 91.5190 million, RMB 99.8238 million and RMB 52.0008 million, respectively, accounting for 6.87%, 5.78%, 5.02% and 5.01% of the operating income , respectively , showing a downward trend year by year.

In addition, Feisu Innovation mainly relies on outsourcing for product production, and its independent production capacity is weak . Feisu Innovation generally has two production modes: one is that the company conducts research and development and designs itself and then hands it over to suppliers to complete production ; the other is that the company and suppliers jointly develop and then the suppliers complete production . The cooperative outsourcing manufacturers will produce according to the technical standards, structural performance, parameter indicators, and appearance styles set by the company .

From 2020 to 2022 and the first half of 2023 , the cost of Feisu Innovation's outsourced products was RMB 591 million, RMB 706 million, RMB 894 million and RMB 452 million, respectively, accounting for 85.53%, 83.76%, 82.58% and 84.51% of the company's main business costs, respectively.

Feisu Innovation said that the production capacity, quality and delivery time of the network communication products sold by the company are to some extent limited by factors such as the production capacity, product technology and management level of the outsourced manufacturers . If the outsourced manufacturers encounter unexpected situations or the cooperation agreement signed with the company is terminated early , there may be a delay in product supply, which will have an adverse impact on the company's operating performance.

To sum up, for fast innovation, if it wants to achieve long-term development in overseas markets and successfully go public in the future, it must avoid the above risk factors and pay attention to building its own competitiveness in the market.

Listing

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