Can Hubei Yinfeng Cotton IPO Succeed?

Cotton is a dicotyledonous plant. It is the only crop that produces fiber from seeds. As an important textile raw material, cotton is one of the most important economic crops in the world. It is made up of four cultivated cotton species, namely Asian cotton, African cotton, upland cotton and island cotton. The most widely cultivated land cotton is about 90% of the total cotton output in the world.

In China, cotton is the second largest agricultural product after grain. In China, about 46 million households and 120 million farmers are engaged in cotton cultivation. Land cotton has become the main species in China. The island cotton has a certain scale output in Xinjiang.

Affected by the characteristics of cotton production and production, the cotton processing and circulation industry presents significant regional and seasonal characteristics.

Hubei Yinfeng cotton Limited by Share Ltd (hereinafter referred to as Hubei Yinfeng cotton) is suitable for the regional distribution of cotton planting. Processing and circulation enterprises have established processing plants in the main cotton producing areas, and have made regional acquisitions. After processing, lint is sold nationwide. Cotton processing enterprises in China are mainly distributed in the main cotton producing areas such as Xinjiang, Shandong, Hubei, Hebei and Henan. Hubei Yinfeng cotton, in order to adapt to the seasonal growth of cotton, the processing and circulation enterprises adopt the mode of "seasonal acquisition, centralized processing and annual sales" to organize their own business activities.

The main product of Yinfeng cotton in Hubei is lint. Sales revenue has increased steadily during the reporting period. The market share of Hubei Yinfeng cotton is basically stable at 1-2%.

According to the China Cotton Association statistics, in 2009-2011, in the supply and marketing cooperative system cotton professional company, Hubei Yinfeng cotton purchase and sale volume ranked third, sales revenue ranked fourth, total profit ranked second, asset size ranked fourth.

Among them, in 2011, Hubei Yinfeng cotton purchase and sale volume ranked third, sales revenue ranked third, total profit ranked second, asset size ranked fourth.

As one of the most important agricultural products, cotton has certain periodicity under the influence of planting area and weather. The output of cotton has a cyclical fluctuation in the year. But because of the smaller demand elasticity of cotton, the price of cotton also fluctuates periodically with the change of output and stock.

In the next few decades, textile consumption will grow steadily, while the increase of cotton planting area will be limited. The demand for cotton will be realized through the increase of unit production.

Therefore, in the long run, cotton prices will remain at a high level, and the cotton processing and circulation industry will show steady development trend.