How Frustrate Is The Road Of Clothing Enterprises Going Public?

With the re attack of the "mother-in-law dispute", the fashion of Sini Su finally came to the Shanghai Stock Exchange. The Ningbo fashion brand Shanshan also landed on the Hong Kong Stock Exchange in June 27th and is officially listed. However, it is still a suspense that Jordan queuing up for many years, "regular customers", Jordan sports and whether or not IPO can make his wish.

For apparel companies, listing helps cash flow and capital chain expansion, and helps brand diversification, new technology iteration and international layout, but listing is not smooth sailing.

It is reported that in 2017, there were 9 garment enterprises to become a member of the A share clothing section. Among them, Taiping bird IPO continued to sprint for 3 times before it was successful. The queuing time lasted 6 years. fashion Daily fashion has gone through two rounds of IPO sprint.

Textile and clothing brand management experts, Cheng Weixiong, founder of Shanghai Liang Qi Brand Management Co., Ltd., told the winning business network that not only the clothing enterprises, but also any enterprise sprinting IPO will face the high threshold of strict approval, which is a normal phenomenon. Whether the audit can be related to the industrial pattern, market function, enterprise innovation ability and so on.

External environment: approval and strict queuing time.

As of June 21, 2018, the China Securities Regulatory Commission (CSRC) has received 307 first and second depository receipts companies, of which 26 have been passed, and 281 have not yet been issued. 274 enterprises that normally fail to be heard in the enterprise have not been passed, and 7 enterprises have been discontinued.

In terms of garment enterprises, Hechi group (China) group, which is queuing up for IPO's domestic dress, has already issued the prospectus for the first time, plans to issue no more than 127 million shares on the Shanghai stock exchange, and raise 3 billion 200 million yuan for business expansion.

It is reported that from the past meeting to get approval, the issuer and the sponsor organization also need to do a lot of work such as post event review, important matter prompts, sealing up and so on. Even if they pass the trial meeting smoothly, they may be in the process of waiting for approval. In 2011, Jordan sports, which launched IPO for the first time in 2011, was postponed to the listing process for trademark disputes, and hit IPO two times in 2016. But until now, Jordan sports is still in the past but not approved.

In addition, interest disputes and competitors' reports may lead to endless changes in the way of listing. fashion Although it is a family dispute, it reflects the game between interest groups.

For the long process of examination and approval, Cheng Weixiong told the winning business network that this is a strict examination conducted by the state for consideration at the macro level, which is a normal phenomenon. As for the same year to submit a draft prospectus to the SFC, some have become listed companies, some have terminated IPO, and others are still in the IPO queue list, which is closely related to their own development.

Internal problems: high inventory, independence, innovation ability...

High inventory is clothing A big factor for enterprises to be questioned.

In 2011, 5 of the 10 shoe and clothing enterprises seeking A shares were listed in Nanjing, Shandong and Vigna S, because they were too high in stock.

IPO is the most representative of Mass Phil's "four entering Palace". Statistics show that Mass Phil submitted the IPO application for the first time in 2014, during which he had 3 discontinuation of the review. The reasons were "incomplete application documents, which led to the failure of the audit process." In January 18, 2017, Mass Phil submitted an updated draft prospectus to the SFC, which has been in the queue of "pre disclosure update".

From the prospectus, in 2013, 2014, 2015 and the first half of 2016, Mass Phil's book value of stock was 504 million yuan, 613 million yuan, 780 million yuan and 777 million yuan, respectively, accounting for 26.62%, 26.33%, 28.90% and 29.50% of total assets.

The CSRC's feedback on the application documents for initial public offerings of Mass Phil fashion Limited by Share Ltd released in February 22, 2017 also pointed out that at the end of the reporting period, inventory accounts accounted for more than 70% of the total inventory of Mass Phil within two years, and the inventory turnover rate of the company was lower than the average level of the industry. It was requested that in the management discussion and analysis of the prospectus, the company's inventory balance should be analyzed according to the number of stores opened, the average single store inventory and the average single store sales situation of the company in Shenzhen.

Hai Lan home, which published the prospectus in March 8, 2012, has also been questioned because of its high inventory. The prospectus shows that the profits of Hai Lan's home from 2009 to 2011 are good, but the asset liability ratio is very high, and the inventory turnover rate is very low.

However, ultimately, the IPO of Hai Lan's home is not high inventory and sustained profitability. It is a matter of poor independence and related spanactions. According to the securities and Futures Commission, Hai Lan group, the controlling shareholder of Hai Lan's home, once held Keno technology. In 2009 and 2010, 3 main suppliers of Keno technology had business or capital exchanges with Hai Lan's home and Hai Lan group. Therefore, the independence of Hai Lan's home has been questioned and there are many doubts about related spanactions.

Insiders have said that the threshold of the garment industry itself is relatively low, and many enterprises may not have the core competitiveness of listing. Low inventory turnover, large risk of unsalable sales, lack of sustained growth in performance, and the lack of certainty in market prospects and profitability are the reasons why the listing is not listed.

"The biggest problem in the clothing industry is inventory, and there are too many data flaws in the purchase and sale of inventory. Some enterprises even have basic credit problems. Therefore, the road to listing is rather difficult." An anonymous retailer of clothing retailing said in an interview with the winning business network.

Listing prospects: sprint IPO team expansion

Despite the ups and downs of listing, there are still a large number of enterprises rushing to the capital market.

According to the news that has been published, in addition to queuing IPO's herkie (China) group, the Internet Clothes & Accessories And women's clothing business enterprises also began to aim at this "cake".

According to media reports, the new three board women's clothing business enterprise Han Du Yi she and you Yi purchased at the end of 2017, began stepping on the sprint board sprint IPO Road, the Internet clothing brand clothing Tiancheng plans to report gem or motherboard IPO in early 2019.

Cheng Weixiong said that the listing of garment enterprises has great influence on their own development. Many enterprises in China need capital assistance to realize their spanformation, and the spanformation of brand economy and competition with international brands can effectively enhance the industrial value chain and comply with the "one belt and one way" policy. Under the influence of the Sino US trade war and the upgrading and expansion of consumption, the state level will give support to Chinese enterprises and will bring positive benefits to the listed companies.