UGREEN, a Shenzhen-based consumer electronics company, submitted a prospectus to the Shenzhen Stock Exchange on June 2 as it plans to carry out an IPO on the ChiNext. Huatai United Securities is acting as its sponsor and lead underwriter.
UGREEN focuses on technology and consumer electronics, and is mainly engaged in the R&D, production and sale of 3C products. It says it is committed to providing users with comprehensive digital solutions. The products mainly cover docking stations, headphones, charging cables, mobile power banks and portable storage devices.
Through this IPO, the company plans to raise 1.5 billion yuan ($225.5 million). 550 million yuan will be used for product R&D and industrial construction and 110 million yuan will be used for intelligent warehousing and logistics construction. 392 million yuan is planned to be used for a headquarters operation center and brand building, and the remaining 450 million yuan will be used to supplement working capital.
According to the prospectus, the operating income of UGREEN was 2.045 billion yuan in 2019, 2.738 billion yuan in 2020 and 3.446 billion yuan in 2021, corresponding to gross profit margins of 35.71%, 38.10% and 37.21% from 2019 to 2021. Domestic and overseas markets account for almost half of the revenue. The net profit after deduction of non-recurring is 220 million yuan in 2019, 287 million yuan in 2020 and 276 million yuan in 2021.
From 2019 to 2021, the R&D investment of Green Alliance was 64.8853 million yuan, 95.127 million yuan and 157 million yuan respectively, accounting for 3.17%, 3.47% and 4.54% of operating income.
The prospectus showed that the company has explored domestic and overseas markets, and is adopting online and offline sales channels in China, the United States, the United Kingdom, Germany, Japan and other countries and regions around the world.
The market development of the consumer electronics industry continues to improve. According to statistics by CCIA, the total sales of the industry in 2018 were about 300 billion yuan, and total shipments were about 3.8 billion pieces. In 2019, the total sales of the industry were about 382.8 billion yuan. In 2020, the industry market size reportedly exceeded 480 billion yuan, with a three-year CAGR of 16.96%.