Hosiery Concept Capital Market IPO Approved

Here world Clothing and shoes Xiaobian network to introduce the concept of subdivision socks industry has been recognized, IPO success.

　　 Socks industry It is one of the fine industries in the chain of China's textile and garment industry. Because its products are indispensable to people's daily consumer goods, the global market capacity is huge. As a leading enterprise in China's cotton socks export, Jian Sheng group has been able to succeed this time, which shows that the current capital market is more popular for the concept of subdivision industry characteristics.

The capital market is really bad. Earlier, La Natsu Bell and other brands of women's clothing enterprises and small children's brand enterprises rushed to A shares IPO failed, but this time, a foreign trade processing cotton socks production enterprises have been successful.

In November 5th, the China Securities Regulatory Commission announced that the Limited by Share Ltd of Zhejiang Jian Sheng group (first) was adopted.

The number of shares issued by Jian Sheng group is no less than 25% of the total shares issued after the issue, and the number of shares issued is not more than 20 million shares. According to the prospectus, the fund-raising investment can be divided into three aspects: first, 50 million 200 thousand yuan for 12 million new high-grade cotton socks production line technical transformation projects in the year; two is 262 million 300 thousand yuan for the annual 78 million double high-grade cotton socks production line technical transformation project; three is 120 million yuan for supplementary working capital.

　　 Decathlon, Okamoto and other core cotton socks suppliers

The Japanese market accounts for about 30% of the total sales.

Jian Sheng Group mainly produces all kinds of cotton socks for international manufacturers in ODM and OEM mode. Its products are mainly exported to Japan, Europe and Oceania market. Among them, sales to Japan account for about 30% of the company's total sales.

The company currently owns 5 production bases: Hangzhou Jian Sheng socks, Hangzhou Qiao Deng knitting, Jiangshan Yi Deng knitting, Jiangshan Sijin textile accessories, Jiangsheng knitting group of Zhejiang Jiangsheng group. Zhang Maoyi directly owns the 72% share of the company's first issue and is the actual controller of the company.

Its products include men's socks, women socks and children's socks, including short socks, medium tube socks, stockings, pantyhose and other cotton socks products. In addition, it also produces all kinds of sports socks, such as golf socks, Ski socks, tennis socks, running socks and so on. At the same time, we produce a variety of special function socks, such as double hose socks, tights, bamboo fiber socks, infrared thermal socks, antibacterial and odor resistant socks. The company has an annual capacity of about 140 million pairs.

The company is a long-term stable supplier of Okamoto, Itou Tada, Decathlon, Dao Bu, Pacific, Metro and other international manufacturers, for its production of Puma, FILA, new bun, LEE, Lotto, Adidas, Tommy Hifiger and other brands and TOPVALU, UNIQLO, Muji and other stores own brand of socks products. These customers account for more than 80% of the company's total annual sales.

Statistics show that Okamoto is the largest production and sales enterprise in Japan's socks industry. It has a history of more than 80 years, and has more than 10 world famous brands such as Nike and MIZUNO, which sell and sell socks in Japan. In 2011, it sold 150 million pairs of cotton socks and 9% of its annual sales. Metro is Germany's largest and third of the world's retail and wholesale supermarket group. In 2011, sales of cotton socks amounted to $8 million, and the group accounted for 45% of its sales. Tao is a subsidiary of Puma group. It is a professional cotton stocking buyer in Europe. It sold 110 million pairs of cotton socks in 2011, and Jen Sheng group accounted for 18% of its annual sales volume. Decathlon, the world's largest sporting goods retailer, sold 100 million pairs of cotton socks in 2011, and the group accounted for 21% of its annual sales.

These large customers are multinational enterprises. Once they establish long-term cooperative relationship with suppliers, they will not easily change suppliers to maintain quality stability. Moreover, they have a higher gross margin, and pay more attention to the quality and delivery cycle when choosing suppliers, which is less sensitive to the price increase of suppliers. Even if the price of raw materials rises sharply and the appreciation of the RMB is too fast, the company can communicate with them in time to raise the unit price and ensure a reasonable profit.

In 2011 ~2013, the business income of Jian Sheng group was 397 million yuan, 445 million yuan (12.1% year-on-year increase) and 558 million yuan (up 25.4% over the same period). The net profit was 51 million 671 thousand and 600 yuan, 65 million 305 thousand and 500 yuan (up 26.39%%), 75 million 436 thousand and 500 yuan (15.38% over the same period), and gross profit rates were 29.72%, 29.72% and 29.72% respectively. In 2014 1~6, its revenue was 289 million yuan, net profit was 39 million 472 thousand and 100 yuan, gross margin was 30.59%. Generally speaking, its income and net profit have maintained a relatively stable growth. Especially as socks and small businesses, its gross margin can remain at around 30%, which is not easy.

According to China Customs Statistics of cotton socks products in 2013, the export volume of JSG group's cotton socks ranks fourth in the world, and the export volume ranks fifth in the whole country. Sales to Europe, Oceania and Japan rank the first, second and fourth respectively.

　 Quick order response capability is the core advantage.

Raised funds are mainly used to expand production capacity.

As a foreign trade processing enterprise, whether the capacity can be followed up, whether the ability to respond to orders is quick, and whether it has a certain R & D capability to provide good design for customers to implement ODM mode determines whether the company can win long-term stable high-quality customers.

The order of JSG includes two types: long list and short list. According to two different orders, different production modes are adopted.

As long batches of small batches, large batch, long delivery period (usually in 6 months or so), the company adopts the "production and inventory," the production of the organization. For short orders, many small quantities, lots of batches and short delivery times (usually around 3~4 weeks), the company has formulated a quick response production plan for such orders, and through the Jian Sheng production management system V3.0, accurately understood the completion progress of each process, so as to ensure the completion of orders on time and in accordance with quality. Generally speaking, once the new order is confirmed, the company can formulate the corresponding production plan on the same day and complete the adjustment of all corresponding production plans. This quick order response capability has become the core competitiveness of the company to win international customers.

In order to ensure the quality and delivery time of the products and improve the economic benefits of the unit products, the company has also established the auxiliary workshop of Spandex Covered Yarn, rubber cord and other auxiliary materials, equipped with auxiliary production processes such as embroidery, plastic molding, auxiliary decoration, etc., which extends the industrial chain rationally, and enables enterprises to get higher profits.

To implement ODM mode, independent research and development capability is very important. Jian Sheng group has an independent technical team, and its technology development has been involved in the new product design and development of downstream brand operators. At the same time, Zhejiang Sci-Tech University and Zhejiang Sci-Tech University jointly established the Zhejiang Sci-Tech University science and technology research and development center and practice base to carry out industry university research cooperation and improve R & D level. At present, both sides are committed to the research and development of kapok warm and fluffy rib socks, special outdoor sports socks with mosquito repellent function and highly efficient integrated socks process equipment.

In terms of capacity, due to rapid business growth and insufficient capacity, the company can not meet all the needs of customers, and sometimes has to squeeze some customers' orders. In order to enhance competitiveness, the main investment of this fund is production line technical transformation, increase production capacity, and the investment is estimated to be about 432 million 500 thousand yuan.

As of June 30, 2014, "12 million new high-end cotton socks production line technical transformation project" has been basically implemented. "78 million additional double high quality cotton socks production line technical transformation project" has been implemented, which will increase its production capacity by 90 million pairs.

According to the plan, the company also plans to invest $14 million to build an annual production of 36 million pairs of medium and high-grade cotton socks production line in Vietnam's Haiphong Singapore Industrial Park. The total investment of the project is estimated at 85 million 400 thousand yuan (US $14 million). We plan to complete construction investment within two years after the project is implemented. After the project is fully completed, it will produce an annual production capacity of 36 million pairs of high-grade cotton socks. The annual sales revenue will be 118 million 800 thousand yuan (about 19 million 500 thousand US dollars) and the total annual profit will be 24 million 70 thousand yuan (about 3 million 950 thousand US dollars). At present, the project is bidding for civil engineering.

In fact, there are many favorable conditions for Vietnam to build factories in Haiphong Industrial Park in Vietnam. For example, export from Vietnam can get Japan and Australia to impose zero tax on textiles imported from Vietnam, and the EU has a preferential tariff rate of 8% on average for goods imported from Vietnam. These rates are lower than those of the above countries for the import of textiles from China, which is conducive to enhancing the competitiveness of our products in Japan, Australia and the EU market.

Kin Sheng group said that the growth and future development of the company's profits will depend to a great extent on factors such as whether the technical transformation projects can be completed on schedule, and the market structure changes during the construction period. If the project is implemented smoothly, it will play a positive role in expanding production capacity, upgrading product quality and adjusting product mix.

　 Accelerate the expansion of independent brands and domestic market

Quasi push knitted multi category O2O platform "Jian Sheng house"

But it is undeniable that as a relatively high extrovert. machining Enterprises, Jen Sheng group are also facing a lot of uncontrollable risks. For example, the large fluctuation of the price of raw materials such as cotton yarn increases the difficulty of controlling the cost; the fluctuation of exchange rate and the appreciation of RMB continue to affect the income settled by US dollar and yen, which not only affects the international competitiveness of the company's profit and products, but also faces the risk that customers transfer their orders to other Southeast Asian countries.

It is precisely aware of these risks that the group is now expanding its domestic market and gradually realizing the strategic transformation from a single ODM and OEM manufacturer to a variety of profit models.

In 2012, the company began to try to sell its own brand cotton socks, and promote the sale of "Wansheng" and other independent brand cotton socks in China.

In the first half of 2012, sales revenue of its own brand cotton socks was 3 million 400 thousand and 200 yuan, 8 million 550 thousand yuan, and 3 million 737 thousand and 800 yuan respectively, although the amount was small, but its development was swift and violent.

A more daring transformation plan is the "healthy home" innovation park to be planned in the future. The park includes 5 blocks, namely, O2O platform area, knitting equipment area, raw and auxiliary material area, brand center area and supporting service area. The core of this park is "O2O" platform.

The platform is a multi brand, multi category cooperation online and offline knitted consumer goods joint sales platform. Through the service brand "Jian Sheng home", we will gather all kinds of clothing and multi brand products. Among them, the main brands are all joint venture brands, which are deep equity cooperation.

In addition, the group also plans to expand its domestic market by deepening its cooperation and cooperation with customers based on existing international cooperative clients.

These include: trying to enter the HOLEPROOF under the Pacific.