Analysis Of The Reasons Behind The Obstruction Of Red Dragonfly IPO

After a lot of hardships, the "single log bridge" will soon usher in the moment of "fish and Dragon Gate".

The total number of initial public offerings does not exceed 58 million 800 thousand shares, but suddenly announced the cancellation of the 5 day online roadshow and the 6 online purchase, and decided to postpone the subsequent issuance.

The news came a little abrupt, and the company announced that it had been verified by the report.

Like red dragonfly, it is not common for A shares to be released at a critical moment before listing.

The red dragonfly is a fashionable shoe and garment enterprise which is mainly based on the Red Dragonfly brand, and integrates the design, development, production and sale of leather shoes, leather goods and children's articles.

Red dragonfly has not disclosed why it was reported.

On the eve of the company's listing, there were frequent reports on the Internet that there was a trademark dispute between the company and another enterprise, Lucheng red dragonfly.

The group has an undisclosed "secret".

Who is sniping at the Red Dragonfly IPO?

Media focus analysis

1. The relationship between red dragonfly and AOKANG's actual controller.

The same as Wenzhou shoe enterprises, red dragonfly and Lucheng Red Dragonfly dispute has been a long time, but it has a little relationship with Wenzhou, another listed shoe company AOKANG international.

Reporters found that the actual controller Qian Jinbo of red dragonfly is actually the uncle of AOKANG international actual controller and chairman Wang Zhentao's wife, Lin Li Qin, and has also been one of the sponsors of AOKANG international predecessor, Yongjia Huang Tian Olin shoe factory.

As a competitor, the Red Dragonfly Prospectus has not disclosed the relationship between the two companies.

2. Dispute over the right to use the name.

Lucheng Red Dragonfly legal representative Chen Shi District told reporters that a few days ago, the company did report the real name of the red dragonfly to the SFC, and the company and the Red Dragonfly had a long dispute over the right to use the name.

Chen Shi District disclosed that the company was in Zhejiang province in April 23rd this year.

The Municipal Intermediate People's court filed a case and called for the cancellation of the name "Red Dragonfly" in the red dragonfly. The case will be held in court on May 29th.

"When the right to use red dragonfly is not listed, it will hurt investors' interests."

For the reasons for reporting, Chen Shi District explained.

And the Red Dragonfly side told reporters that after the conclusion of the case, the results will be released in time according to the relevant provisions of information disclosure.

3, the number of direct outlets declined.

Because of the general downturn in the footwear industry, red dragonfly franchisees and direct stores have experienced a downward trend in recent years.

The number of Direct stores decreased from 699 at the end of 2011 to 530 at the end of 6 in 2014, a total reduction of 169.

4, low R & D investment

According to the Red Dragonfly Footwear prospectus, in the company's staff composition, technical secondary school / high school and below 4562 people, accounting for up to 69.26%, undergraduate and above education staff accounted for 7.52%.

The age distribution of employees also fully shows the characteristics of labor-intensive enterprises. The proportion of employees below 30 years old accounts for 58.26% of the total staff of the company. Among them, the proportion of young people under 25 is the largest, 36.91%.

On the other hand, the proportion of young workers is too high. The desire of the company to expand its sales path and enhance its marketing capability is not difficult to understand.

The Red Dragonfly shoe industry will invest 866 million 912 thousand and 500 yuan into the construction of marketing channels in this capital raising project, which will account for 88.94% of the funds raised, and the sales expansion will be obvious.

The company's financial data show that the company's Red Dragonfly research and development company even appeared profit loss in 2013, and the net profit in 2013 was -127.91 million yuan.

With the expansion of the sales network, the R & D expenses will not rise or fall. In the long run, the competitiveness of the Red Dragonfly shoe industry in the labor-intensive industrial chain will be reduced.

It is worth mentioning that the Red Dragonfly shoe industry was recognized as a high-tech enterprise by Zhejiang Province in 2009. In the year of 2011, it enjoyed the preferential tax policy of high and new technology enterprises, and paid enterprise income tax at 15% tax rate.

Since 2012, the company's income tax rate is 25% of the general corporate income tax rate. It has no longer enjoyed the preferential treatment of high and new technology enterprise income tax rates.

5. Doubt about financial relationship.

According to the Red Dragonfly financial statements, there has been a large amount of money in its accounts. Most of them are bank deposits, which are up to hundreds of millions of yuan each year and are increasing. On the other hand, their short-term loans and long-term borrowing are still high. The Red Dragonfly pays a large amount of interest on loans every year, resulting in high financial costs. But the red dragonfly is unwilling to take out the money to repay its bank loans. This behavior is really hard to understand.

It is also incomprehensible that its balance sheet and cash flow statement can be seen in its financial relationship.

6, the main product sales situation vague, intended to inflate profits.

In the prospectus, the red dragonfly has not disclosed the production capacity, output and sales volume of its leather products, children's articles and garments. Of course, these products account for a relatively low proportion of their main leather shoes, which can not be disclosed. However, it is strange that the red dragonfly has not disclosed any important information about its main products, such as the sales volume, production and sale rate, and the selling price of the leather shoes, which is obviously not consistent with the relevant provisions of the letter.

According to the Red Dragonfly's main products, the total output of leather shoes and the sales of leather shoes and average cost price predicted by reporters, and the new stock and the new stock amount of Red Dragonfly leather shoes in recent years.

The estimated theoretical stock of leather shoes is much higher than that of the Red Dragonfly prospectus. Therefore, the reporter suspects that red dragonfly is suspected of inflated output, and increases the unit output ratio by raising the gross output rate, and ultimately achieves the purpose of increasing the profit margin.

Views from all sides

informant

Lucheng Red Dragonfly legal representative Chen Shi District: a few days ago, we reported to the China Securities Regulatory Commission the real name of Zhejiang red dragonfly.

Can the company not use the name "Red Dragonfly"? Is it really a listing? Is it not a shareholder? It is harmful to the interests of investors that the right to use the red dragonfly is not listed regularly.

Company response

It is normal for competitors to find trouble at this point in time. We will disclose the contents of the litigation in strict accordance with the requirements of the SFC later in the information disclosure. Thank you for your attention. We will prepare a notice in the near future according to the requirements of the SFC, giving investors and the media a detailed explanation.

The relationship between uncle and nephew is not related to the accounting standards for enterprises and the rules for the listing of shares in the Shanghai stock exchange. In reality, it does not have any real impact on the operation of both companies.

Qian Jinbo and Wang Zhentao do not have any control or significant influence on the other company's composition.

Therefore, the relationship between two parties does not constitute competition in the same industry, nor is it a mandatory disclosure relationship. Therefore, there is no need to disclose in the declaration materials.

Netizens view

@ Messi Messi100: many large scale businesses in Wenzhou are relatives, friends, neighbors and so on.

Look at several enterprises that sell billions of dollars in Liushi, and they are related to each other.

@ Guangdong stock company: so how can a company be listed on a company whose trademark is not clear? Is it enough to deceive consumers and come to the stock market to deceive investors? In the end, which red dragonfly is producing fake and inferior products?

Small invincible small invincible: the quality is not like, no wonder.

@ shares sea talk about stocks: these days have been let the group of people start to fight the red dragonfly, the result is how to suspend IPO, is also drunk.