Invested 8.8 million! Shenzhen Dama invested in a blue ocean category

"How can a company with absolutely no technical content go public?" "A company without core technology goes public, are they preparing to reap profits?" These are the questions that Shenzhen cross-border e-commerce giant Gemtek, the "first mobile phone case stock", has been facing since its listing. Since its listing, Gemtek's stock price and net profit have been declining, and there are more such questions.

Gemet obviously knows its disadvantages and has been trying to get rid of this dilemma. However, perhaps in a hurry to get rid of the label of "no technical content", Gemet chose a field with full technical difficulty for its first breakthrough - intelligent robots.

Invested 8.8 million yuan to enter the field of intelligent robots

Recently, Gemtech announced in its foreign investment announcement that in order to meet the needs of strategic development and business expansion, it plans to use its own funds to increase the capital of Shenzhen Si Ao Tuo Technology Co., Ltd. (hereinafter referred to as "Si Ao Tuo") by RMB 8.8 million. After the completion of this capital increase, it will hold 1.5689% of the equity of Si Ao Tuo, ranking 12th among all shareholders.

It can be said that JMET's investment in Sioto is a bold attempt. First of all, Sioto, founded on October 9, 2021, is very "young" and has only just turned two years old. Secondly, Sioto is a company that focuses on underwater smart products such as underwater cleaning robots and outdoor products. Smart manufacturing is a completely unfamiliar field for JMET, which started out as a mobile phone case manufacturer.

However, since Sioto was able to obtain such a considerable amount of financing, its "resume" is naturally very impressive:

It made a mature demo just one month after its establishment. At the same time, it developed three industry-leading robots within half a year, and was recognized by Amazon and investment institutions, and received three rounds of investment from well-known institutions within half a year. It also received investment from artificial intelligence expert Hu Yu (co-founder of iFLYTEK). It was selected as a demonstration case of intelligent robot application in Shenzhen for two consecutive years in 2022 and 2023. Recently, the headquarters project of Siotuo underwater robots settled in Daya Bay. After the project is completed, it is expected to produce 1 million underwater cleaning robots annually, with an annual output value of about 1 billion yuan.

The performance growth is also rapid. Since the beginning of this year (as of August 31), its operating income has reached 106 million yuan, and its net profit has reached 9.0307 million yuan. Last year, its operating income was only 4.829 million yuan, and its net profit was a loss of 8.5558 million yuan. It turned losses into profits in less than a year.

Not only that, the person in charge of Siotuo is also very outstanding. It is reported that its executive director and general manager Deng Zhuoming has many years of experience in R&D, product design and management, and has served as a senior engineer in MTK, SMIC, ST-E, and iFlytek. He is also the original staff of rtthread and has written the real-time operating system kernel himself.

In fact, the reason why Gemtek chose to expand into the field of intelligent manufacturing is not only because it is eager to get rid of the label, but also because it considers the broad market prospects of intelligent robots. After all, its current performance is not optimistic. If the investment is right this time, there is a great probability that it can be pulled out of the quagmire that is constantly sinking.

After listing, the performance changed, and the cumulative net profit for three years was still negative

In 2020, news of the successful listing of Gemtek and Anker Innovations came one after another, but three years later, their current situations are very different. After listing, Anker Innovations' annual revenue has repeatedly set new highs, and it successfully entered the "10 billion club" in 2021. Last year, most cross-border e-commerce sellers increased revenue but not profit, but it won a net profit of 1.143 billion yuan, a year-on-year increase of 16.43%.

Gemtek is different. Its revenue and net profit have been declining, especially its net profit, which was only 26.42 million yuan in 2021, a year-on-year decrease of 75.16%. In 2022, it was even more exaggerated, directly turning from profit to a huge loss of about 116 million yuan. This decline continued to this year. In the first two quarters of 2023, Gemtek continued to lose 27.3406 million yuan. In other words, Gemtek's cumulative net profit since its listing is still negative.

As the performance changed, the stock price also continued to decline. Gemtek went public on August 2020 with an issue price of 41.26 yuan. On the second trading day, the stock price reached a high of 95.6 yuan per share. However, it continued to decline over the next three years. As of the close of October 17, 2023, the stock price was only 21.72 yuan, a drop of 77.3%. The market value also shrunk from tens of billions to more than two billion.

Gemtek has listed many reasons for the poor performance, such as the continued decline in sales of downstream mobile smart terminal products worldwide, rising prices of upstream raw materials, increased production and management labor costs, and the impact of the external economic environment.

But the editor believes that the core reason lies in its "dependence on big customers". As we all know, Gemtek has Huawei as its backer. By 2019, nearly half (45.47%) of Gemtek's performance was supported by Huawei. It's good to lean on a big tree to enjoy the shade, but there are also risks. Due to a ban from the United States in 2020, Huawei's smartphone and tablet shipments fell sharply, and Gemtek's performance also turned red. In 2022, although Huawei is still Gemtek's largest customer, its sales revenue to it is only 92.34 million yuan, accounting for 12.84% of total revenue.

The decline in purchasing volume from core customers weakened Gemtek's competitiveness and ultimately led to its inability to resist external shocks.

The crisis is imminent. Therefore, its chairman Chen Jianping said: "JMET will turn the situation around in 2023." The "2022 Social Responsibility and Environmental, Social and Governance (ESG) Report" released this year once again emphasized that JMET will achieve the goal of profitability in 2023, and profit growth is the first strategic goal for 2023.

Investing in SiATO may be the first step for it to achieve this strategic goal.

The demand for "water scavengers" is obvious, and some cross-border big sellers have already started production

When it comes to cleaning robots, many people usually think of home sweeping robots first, but in fact there are also robots for outdoor cleaning, such as swimming pool cleaning robots that work in water.

Swimming pools are an important part of European and American families. There are about 30 million private swimming pools in the world, 90% of which are in Europe and the United States. Although swimming pools are good, the cost of cleaning and maintenance is also a headache.

In Europe and the United States, labor costs are notoriously high. This has given rise to market demand for pool cleaning robots. According to statistics from globenewswire, the global pool cleaning robot market size was US$750.5 million in 2021 and is expected to grow to US$2.4835 billion by 2030, with a compound annual growth rate of 14.10%.

Although the market is small, the rigid demand is obvious. At present, the pool cleaning robot market is still in the blue ocean stage. Because it solves the high cost and inconvenience of manual pool cleaning, the market demand has grown rapidly in recent years. And compared with other products, people who own swimming pools are obviously "not short of money", so the products can usually be sold at a high price of 200 to 300 US dollars.

Now some cross-border sellers have set their sights on this market. In mid-July, smart home appliance manufacturer "Dreime Technology" registered a subsidiary "Dreime Pool Smart Technology" and officially started production of pool cleaning robot products, targeting the mid-to-high-end market. Two products will be launched this year.

Not only that, this market has also attracted the attention of the capital market. Even as investment institutions have become increasingly cautious, Yuanding Intelligent, the parent company of swimming pool robot brand Aiper, still received over 100 million yuan in Series A financing on April 11 last year.

And this track is about to make an IPO, namely Tianjin Wangyuan Intelligent Technology Co., Ltd. It is worth mentioning that Wangyuan Technology is also the partner of Zhuimi swimming pool robot.

It now seems that the timing for Gemet to enter this track is just right.

JAMET