Perspective On The Survival State Of GEM Companies

GEM companies appear one after another.

In January 25, 2011, the first application of gem of Shenzhen Han Yu pharmaceutical Limited by Share Ltd (hereinafter referred to as "Han Yu pharmaceutical") was approved by the Securities Regulatory Commission of the SFC.

The company's operating income in 2009 was only 92 million 711 thousand and 400 yuan.

Beijing's first meeting in March 8, 2011, the first three quarters of 2010, the revenue was only 73 million yuan.

Revenue is only around 100 billion yuan, and whether GEM companies can maintain rapid growth after listing, and in the changing market, how these small sampan of A shares are going to break the wave is doubtful.

But the warning has already appeared.

In 2009, 300023.SZ, whose main business income was 117 million yuan, was mutated in just one year, and its main business income dropped sharply to 65 million 897 thousand and 300 yuan in 2010, while net profit dropped by more than 50%.

According to the statistics of the listed companies published in the 2010 annual report, the company reported that there were 59 companies operating below 150 million yuan in the year, and 35 companies were deducted from the ST company, 17 of which were GEM companies, and three of the GEM companies were earning less than 100 million yuan in 2010. They were classified as po de shares, 300052.SZ and 300085.SZ.

Bao de shares and Zhongqing Bao are experiencing more or less "growing pains".

After the hustle and bustle of the growth enterprise market, we can see the survival state of the micro company, or it can be a mirror for the latecomers.

1. Hanyu medicine -- the survival game of pocket company

In January 25, 2011, the first application of gem of Shenzhen Han Yu pharmaceutical Limited by Share Ltd (hereinafter referred to as "Han Yu pharmaceutical") was approved by the Securities Regulatory Commission of the SFC.

Hanyu Pharmaceutical Co., Ltd. is a truly small company. The prospectus shows that in 2007, 2008, 2009 and the first half of 2010, the operating income of Han Yu pharmaceutical company was 56 million 201 thousand and 600 yuan, 77 million 359 thousand and 200 yuan, 92 million 711 thousand and 400 yuan and 51 million 921 thousand and 500 yuan respectively, and the net profit attributable to shareholders of the parent company was 15 million 232 thousand and 200 yuan, 19 million 858 thousand and 800 yuan, 35 million 365 thousand and 900 yuan and 18 million 798 thousand and 900 yuan respectively.

Hanyu pharmaceutical's main business is the development, production and sale of chemical synthetic peptide drugs.

Its main products include three series: peptide pharmaceutical preparations, peptide drug API and client peptides (customized services).

But it can not be ignored that the growth rate of Thymopentin for Injection, one of the main pharmaceutical companies, has been decreasing.

Although Thymopentin for Injection's market size increased from 610 million yuan in 2007 to 973 million yuan in 2009, its annual growth rate was over 19%. However, the growth rate of the product was 53.38% in 2007, and 33.3% in 2008, and 19.70% in 2009.

The same situation appeared on Desmopressin Acetate Injection, another main product of Hanyu pharmaceutical.

Since 2007, the scale of sales of the product has increased rapidly. The market scale has increased from 94 million yuan in 2007 to 276 million yuan in 2009, and the annual growth rate is over 50%.

But in terms of growth rate, Desmopressin Acetate Injection's market size increased by 250.69% in 2007 and 92.92% in 2008. In 2009, the growth rate returned to normal, and dropped to 52.46%.

On the other hand, China's peptide drugs are dominated by foreign brands, and foreign products occupy most of the market share of peptide drugs.

Swiss Novartis pharmaceuticals Ltd., Switzerland Merck snow lano limited and USA Health Pharmaceutical Co., Ltd. have a large market share in the market of peptide medicine in China.

From the market share of thymic five peptides, the growth of the pharmaceutical industry is not obvious.

The company's competitors in this field include Beijing Shiqiao biopharmaceutical and Hainan Zhonghe pharmaceutical Limited by Share Ltd.

In 2007, the market share of Hanyu pharmaceutical in the thymus five peptide was 16.46%, ranking second, and its market share rose to 19.39% in 2008, also ranked second.

But in 2009, the market share of Han Yu pharmaceutical dropped to 16.26%, and the industry rank dropped to third.

Another main product of the company is somatostatin, which dominates the Chinese market for the products of Merck snow lanes limited, Switzerland.

Although the pharmaceutical market has been ranked second in the market share, the market share has been declining.

In this field, in 2007, the market share of Han Yu pharmaceutical was 15.33%, down to 14.19% in 2008 and 13.13% in 2009.

In its three main businesses, the market share of the market is ranked first.

The market share in 2009 was as high as 46.07%.

But thymus five peptide and somatostatin are the main sources of profit for Han Yu pharmaceutical.

In the first half of 2010, Thymopentin for Injection realized gross profit of 15 million 753 thousand and 400 yuan, accounting for 41.71% of gross profit, and Somatostatin for Injection realized gross profit of 11 million 4 thousand and 400 yuan, accounting for 29.13% of gross profit.

The gross profit of desmopressin acetate injection was only 4 million 25 thousand and 200 yuan, and the total gross profit was 10.66%.

The gross margin of 53.03% of the product is also ranked among the three products.

While the growth rate is declining, the pharmaceutical industry of Han Yu also faces competition from foreign giants.

Hanyu pharmaceutical also said in its prospectus that the peptide drug industry is a typical "high input, high risk, high output, long cycle" industry. Product development, registration and certification require huge and continuous capital investment.

If a manufacturing enterprise with competitive advantages fails to get funds for new product development, registration and certification in a timely manner, and it will become bigger and bigger quickly, it will probably become the target of overseas pharmaceutical giant mergers and acquisitions because of capital bottleneck or too small scale.

For a pharmaceutical company with a revenue of around 100 million yuan, it is still doubtful how to kill the siege in the strong enemy.

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2. Beijing crown - small workshop A share Road

In March 8, 2011, the first application of the Beijing gem new technology Limited by Share Ltd (hereinafter referred to as "Beijing Hui Guan") was approved by the SFA.

Beijing's financial data show that the company's main business income in the first three quarters of 2010 was only 73 million yuan.

In 2007, the company's data was only 32 million yuan.

Its main business income increased to 51 million yuan in 2008 and increased to 77 million yuan in 2009.

Although the growth momentum is good, the product structure of Beijing Hui Guan is obviously worrying about its growth.

The company is mainly engaged in R & D, design, production and sales of touch-screen. Its main products are infrared touch screen, and has developed an optical image touch screen and an interactive whiteboard for downstream products.

In its prospectus, Beijing Hui Guan said that the company is one of the world's leading suppliers of infrared touch screens and has a high market share in the large scale touch screen market.

"The company is one of the few enterprises in China that has a complete touch screen independent intellectual property rights.

According to the export data analysis of the Customs General Information Center, the company is one of the largest export enterprises in China.

In terms of its market share, in 2009, the global market for large and medium size touch screens was US $1 billion 110 million, of which the sales of large size touchscreens amounted to US $250 million.

In 2009, the sales of large and medium touch screens in Beijing reached about 10 million 280 thousand US dollars, with a market share of 0.9%. Among them, the sales of large-size touchscreens were US $7 million 512 thousand and the market share was about 3%.

Relatively speaking, the company is relatively strong in the infrared screen market. In 2009, the global infrared screen market size was about $110 million. The sales of Beijing Hui Guan infrared screen was about $10 million 119 thousand, and the market share of the infrared screen was about 9%.

On the other hand, the sales revenue of Beijing's first largest customer Samsung Electronics (Hongkong) Co., Ltd. has shown a downward trend.

In 2009, Beijing's sales revenue to Samsung Electronics (Hongkong) Limited was 18 million 510 thousand yuan, accounting for 25.02% of its sales revenue. In the first three quarters of 2010, the company's sales revenue to Samsung Electronics (Hongkong) Limited was only 8 million 274 thousand and 200 yuan, which accounted for 11.35% of the main business.

In addition, the product model of Beijing Hui Guan is quite complicated.

According to the prospectus of the company, in 2007, 2008, 2009 and 2010 1-9, the products sold by the company were 393, 595, 683 and 802 respectively.

In the first three quarters of 2010, the sales revenue of only 73 million yuan, however, had to produce 802 kinds of products. The average sales revenue of Beijing's single product was below 100 thousand yuan.

Taking the sales revenue of the first three quarters of 2010 as an example, the average sales income of the company's 9.9 inch infrared screen is only 52 thousand and 700 yuan; the average sales income of the 10-19.9 inch infrared screen is 97 thousand yuan; the average sales income of the 20 inch infrared screen is 68 thousand and 200 yuan.

Besides, the non recurring gains and losses also play an important role in the income statement of Beijing Hui Guan.

The financial statements of Beijing Hui Guan show that the impact of non recurring gains and losses on net profit of the company in 2007, 2008, 2009 and 2010 is 463 thousand and 300 yuan, -7.87 million yuan, 4 million 232 thousand and 900 yuan and 2 million 532 thousand yuan respectively, and the contribution rate to net profit is 5.85%, -0.59%, 18.82% and 14.13% respectively.

Of the non recurring gains and losses in 2010, 2 million 896 thousand yuan came from government subsidies.

Smaller revenues also pose challenges for Beijing's research and development.

From 2007 to 2009, the share of R & D expenditure in Beijing accounted for 11.35%, 8.59% and 9.58% respectively.

Beijing Hui Guan said in its prospectus that the absolute amount of R & D investment is still smaller compared with the main competitors in the world because of the smaller scale of the company's revenue. "If Future Ltd can not continuously increase R & D investment and maintain independent innovation and continuous innovation capability, it will be difficult to maintain the leading edge of technology, and the existing advantageous market may be encroached on by other technologies, and the company has the risk of losing technological advantage."

3. Bao de shares - "mini" company's performance mutiny

In March 30, 2011, 300023.SH released its annual report in 2010. During the reporting period, the company achieved operating income of 65 million 897 thousand and 300 yuan, down 43.63% compared to the same period last year, operating profit of 8 million 709 thousand and 800 yuan, a decrease of 70.13% compared with the same period last year, and the net profit of its parent company owners was 13 million 7 thousand yuan, down 51.53% from the same period last year.

And the earnings per share of 0.14 yuan are far below the market's expectations.

The reason for the decline in the performance of the shares is attributed to the continued negative impact of the global financial crisis on the oil industry.

In its 2010 annual report, the company said, "the economic recovery has shown a lagging effect on the recovery of our industry's real economy.

Oil field companies and oil service companies have reduced investment, and the export orders for technical equipment have been significantly reduced. Some of them are performing and the projects are being shelved, the market situation is more severe and market competition is intensified.

But obviously this is untenable.

The main business income of 000278.SZ, which also produces oil and natural gas drilling and production equipment, is not much different from that of 2009 in 2010.

According to the Research Report of "Tian Ying Gu", in 2010, the average revenue growth of oil drilling and special equipment industry was about 16.82%. "The industry as a whole has a revival rebound, and it is expected to maintain a steady growth of about 15% in the future."

By contrast, the performance of Bao de shares is amazing.

According to the annual report of Bao de shares, the company's various business has declined, of which DC, frequency conversion electric drive products fell 24.19%, the top drive, compound drilling machine electronic control system fell 80.56%, service and spare parts fell 81.43%.

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From the sales area, although the East China market grew by 38.13% over the three key markets, the market in North China and Northwest China dropped by more than 50%.

The gross margin of the company's products also dropped by 11.84 percentage points to 27.58%.

And from the efficiency of raising funds, Bao de shares are not ideal.

According to Bao de 2010 annual report, the company's other liquid assets amounted to 221 million yuan, accounting for 60.59% of its total assets.

In October 2009 IPO, the first net raised amount of Baoshi stock was 265 million yuan, but up to now, only 15% of the total raised funds have been used, and the rest still earn interest income in the form of time deposits.

The net proceeds of the first time were 265 million yuan and 105 million yuan.

But as of 2010, the company only used 20 million yuan of the over raised funds to supplement the company's working capital, invested 10 million 200 thousand yuan to set up Xi'an Bao de Electric Co., Ltd. and invested 5 million 211 thousand and 500 yuan for ERP information management project. The remaining 69 million 590 thousand and 900 yuan was over raised funds, and there was no specific use plan.

And the company's capital raising funds for the construction of the oil drilling and production integrated electrical control equipment production base project, its investment progress has also been adjusted.

In the current reporting period, the company adjusted the investment progress of the project, and expected to complete all civil works in December 2011, and put it into operation in December 2012.

However, there may still be an impact of force majeure on project progress.

In spite of the sharp decrease in operating revenue, the company's sales and administrative expenses are basically unchanged from 2009, Tian Yuan said in his report.

Among them, "management travel expenses and business promotion fees increased by 11% and 46% respectively, reflecting the management's efforts to win customers, and the cost of wages and social security decreased by 43%, indicating that many employees may have left the company inside."

It is in its report that the change of core personnel in the company is the root cause of the current situation.

"Unless the company solves this problem quickly and effectively, there will be no obvious improvement in the future business situation."

In January 11, 2011, Aman Chang, the managing director and deputy general manager of Bao de stock, resigned. As early as October 2010, Aman Chang had resigned his position as chief financial officer.