Awesome! Another cross-border company in Shenzhen successfully listed

In recent years, the LED lighting market has ushered in huge development opportunities.

According to the latest research report on the global LED lighting market released by market research platform Reportlinker, the global LED lighting market is expected to reach US$132.96 billion by 2030. From 2022 to 2030, the compound annual growth rate of the global LED lighting market will reach 10.5%.

China is the world's largest producer of LED lighting products, with unparalleled advantages in production capacity. Therefore, more and more LED lighting companies are actively rushing to go public to gain more market opportunities.

1. Minbao Optoelectronics successfully IPOed, with a total market value of 5.3 billion!

On July 25, Minbao Optoelectronics was officially listed on the Shenzhen Stock Exchange's Growth Enterprise Market.

However, Minbao Optoelectronics' road to listing was full of twists and turns.

On July 22, 2020, Minbao Optoelectronics submitted an application to the Shenzhen Stock Exchange's ChiNext.

After five rounds of inquiries, Minbao Optoelectronics withdrew its listing application on September 28, 2021.

In May 2022, Minbao Optoelectronics once again applied for listing on the GEM.

In September 2022, Minbao Optoelectronics successfully passed the review.

On May 18, 2023, the IPO review status of Minbao Optoelectronics was updated to “Registration Effective”.

On July 25, 2023, Minbao Optoelectronics officially issued subscriptions on the Shenzhen Stock Exchange's ChiNext board, issuing 26.17 million shares at a price of 51.05 yuan per share. The upper limit of subscriptions was 6,500 shares, with a price-earnings ratio of 25.16 times. Guosen Securities is its exclusive sponsor.

In this IPO, Minbao Optoelectronics plans to raise 1.1 billion yuan, of which 590 million yuan will be used for the LED lighting automation expansion project, 310 million yuan for the headquarters building and R&D center construction project, and 200 million yuan for the working capital replenishment project.

Minbao Optoelectronics actually raised 1.335 billion yuan, with a total market value of approximately 5.3 billion yuan.

Shenzhen Minbao Optoelectronics Co., Ltd. (hereinafter referred to as "Minbao Optoelectronics") was established in 2010. It is a high-tech enterprise focusing on the green lighting business field, mainly engaged in the research and development, design, manufacturing, sales and services of LED lighting products.

Minbao Optoelectronics has always focused on serving overseas regional brands and engineering companies, and providing customers with ODM products in the fields of commercial lighting and industrial lighting . The proportion of ODM product revenue has exceeded 99% in each period.

The main businesses include: commercial lighting, industrial lighting, educational lighting, smart agricultural lighting, intelligent lighting, high-end lighting customization, etc.

Minbao Optoelectronics serves overseas countries and regions such as Europe, North America, Oceania, Japan, as well as the domestic market, and its products are sold well in more than 100 countries and regions around the world.

The company's brand customers include Endo Lighting, Iwasaki Electric, Cree, Rexel, Gavis and Opple Lighting, among other well-known domestic and foreign companies.

2. Revenue and net profit fluctuate , and Minbao Optoelectronics faces multiple risk factors

According to the prospectus of Minbao Optoelectronics , from 2020 to 2022, the operating income of Minbao Optoelectronics was approximately RMB 1.059 billion, RMB 1.497 billion, and RMB 1.465 billion, respectively, and the company's net profit was approximately RMB 174 million, RMB 168 million, and RMB 245 million, respectively. The non-net profit attributable to the parent was approximately RMB 149 million, RMB 157 million, and RMB 212 million, respectively.

From the above information, it can be seen that the revenue of Minbao Optoelectronics showed a slight decline in 2022 , and the company's net profit and non-GAAP net profit attributable to shareholders maintained an overall growth trend.

According to preliminary estimates by Minbao Optoelectronics , the company's operating income in January-June 2023 is expected to be RMB 700 million to RMB 750 million, a change of -6.06% to 0.65% compared with the same period in 2022. The net profit attributable to the parent company's shareholders is expected to be RMB 90 million to RMB 100 million, a change of -22.63% to -14.03% compared with the same period in 2022. The net profit attributable to the parent company's shareholders after deducting non-recurring gains and losses is expected to be RMB 82 million to RMB 92 million, a change of -21.48% to -11.90% compared with the same period in 2022.

Regarding the risk of a decline in the company's operating performance in 2022, Minbao Optoelectronics mentioned in its prospectus that the company's product gross profit margin is facing pressure to gradually decline due to the impact of similar products from market competitors , fluctuations in the US dollar exchange rate, and changes in consumer demand .

It is understood that from 2020 to 2022, the gross profit margin of Minbao Optoelectronics' main business was 34.11%, 28.19% and 32.09% respectively , showing an overall fluctuating downward trend.

The sales price and cost of products directly affect the gross profit margin of products. Product prices are affected by multiple factors such as the external market environment, changes in demand, and fluctuations in the US dollar exchange rate . Product costs are affected by factors such as export taxes, price changes of product materials, labor costs, and fixed asset investment .

Therefore, Minbao Optoelectronics must take better measures to cope with the adverse effects of multiple factors such as changes in the external market environment and increased costs on gross profit margin and performance .

At the same time, the revenue of Minbao Optoelectronics is greatly affected by overseas markets, and its overseas sales revenue accounts for a relatively high proportion. In the past three years, the company's overseas market revenue accounted for more than 95%.

Due to its high dependence on overseas revenue, the company is also affected by multiple factors such as the international trade environment, logistics and transportation , and changes in supply and demand structure in the short term .

However, Minbao Optoelectronics has certain advantages in research and development.

The company has formed a complete R&D system and pays great attention to appearance design, lighting effect design and application functions in product innovation.

In terms of appearance design, LED lighting fixtures combine the advantages of traditional lighting sources and lighting fixtures, while also conducting in-depth research on consumers' personalized and differentiated needs to design and develop products.

In terms of lighting effect design, it not only meets the lighting needs, but also pays more attention to the lighting effects.

In terms of application function innovation, make the product's application scenarios more diversified.

In the past three years, Minbao Optoelectronics has developed more than 40,000 LED lighting products, taking a leading position among export lighting companies.

At the same time, the company is also increasing its investment in research and development.

From 2020 to 2022, the R&D expenses of Minbao Optoelectronics were RMB 60.3982 million, RMB 70.9493 million and RMB 79.3173 million, respectively.

In 2022 alone , the revenue from civil explosives optoelectronics core technology products reached 1.464 billion yuan , accounting for 99.92% of the total revenue .

Minbao Optoelectronics has developed a number of core technologies in the fields of lighting system heat management, optical design, heat dissipation design, dimming and color adjustment.

As of the end of 2022, Minbao Optoelectronics and its subsidiaries owned a total of 697 domestic patents, including 21 invention patents, 340 utility model patents, and 336 design patents.

In addition, many lighting products developed by Minbao Optoelectronics have won authoritative design awards such as the "German IF Design Award".

It is worth noting that Minbao Optoelectronics had quite abundant cash flow during the reporting period.

At the end of each period of the reporting period, the balance of Minbao Optoelectronics' trading financial assets was RMB 322 million, RMB 435 million and RMB 453 million, respectively, mainly bank wealth management products. Together with bank wealth management products and cash, Minbao Optoelectronics currently has RMB 563 million in "idle" funds.

In addition, Minbao Optoelectronics also distributed large cash dividends during the reporting period.

From 2020 to 2022 , the company's cash dividends were RMB 100 million, RMB 16 million and RMB 33.9905 million respectively.

From this, it can be seen that Minbao Optoelectronics does not seem to be short of money, but this IPO plans to raise 308 million yuan to supplement working capital.

In this regard, Minbao Optoelectronics stated in its prospectus: Supplementing operating working capital can reduce the risks faced by the company during its development, and the business characteristics of the industry to which the company belongs objectively require the company to have sufficient working capital. On the other hand, some of the company's financial indicators are at a disadvantage compared with listed companies in the same industry.

In recent years, the LED lighting product track in which Minbao Optoelectronics is located has also burst out with unprecedented market potential.

In the future, with the rapid release of demand for LED lighting products, the dividends and advantages of this field will become more obvious.

Civil Explosives Optoelectronics

Listing