Long Lee IPO "Second Palace" Eve Of The "Corrugated Leader" Capacity Digestion To Be Solved

The long LEED intelligent Polytron Technologies Inc, which was originally commissioned by the trial Commission in October 17th (hereinafter referred to as "dragon profit"), was cancelled on the eve of the previous meeting, and it needed to be further verified. "A shares" is regretted once again.

And when the sky will be in the Ke Hai news, Jiamei packaging, Rui Ming shares, Ke anda 4 enterprises, have successfully entered the IPO.

As the leading manufacturer of corrugated packaging industry in China and the "top 100 Chinese printing and packaging enterprises", dragon's experience in the capital market is a twists and turns.

Long Li De was a new three board company, in May 2017, it submitted the gem IPO application. However, when the first meeting was held in January 2018, it was rejected by the SFC.

Not long after that, long Li also planned a major asset restructuring of *ST 600701.SH, a listed company, but failed in two months. In November 2018, it changed its name from "Long Li De packaging printing Limited by Share Ltd" to "long LEED smart Polytron Technologies Inc" and again sprint IPO.

Cancel the application on the eve of two degree clearance

The prospectus shows that long Li has been engaged in R & D, design, production and sales of corrugated cartons and cardboard. Its production base is in Anhui and Shanghai, and its service customers are mainly concentrated in East China, covering food and beverage, daily chemicals, grain and oil, home office, electronic equipment, medical and medical industries.

It is worth mentioning that in August 2015, dragons launched the new three boards, and delisted in September 2017, and began to receive listing guidance in February 2016.

From the perspective of the process, in June 9, 2017, the long Lee prospectus was disclosed in advance, and the pre disclosure update was made in December 20, 2017 to apply for the listing of Shenzhen Stock Exchange's gem, and the sponsor was Soochow securities.

However, in January 2018, the first meeting was rejected.

At that time, the issuance examination committee focused on five major aspects of dragon's profits, including the large amount of interest free lending funds of the real controlling people and their related parties. The revenue from the carton and gross profit margin increased year by year, and carton sales and sales revenue grew faster. The concentration of the top five customers was higher, the suppliers' linkage and equity transfer, and whether the new capacity could be effectively digested.

Take the actual control of large amount of capital lending as an example, during the reporting period, there was a case of long interest loan to real controller Xu Longping and other interested parties. From 2014 to 2016, the amount of the above loans was about 151 million yuan, 165 million yuan and 205 million yuan. The Commission asked it to explain the use of funds and the rationality and necessity of short-term loans.

In addition, in 2014 -2017 1-6, the capacity utilization rate of corrugated paper box was 88.28%, 99.81%, 100.79% and 78.09% respectively, and the utilization rate of corrugated cardboard was 50.97%, 54.40%, 64.94% and 47.5% respectively. The issuance examination committee focuses on whether its new capacity can be effectively digested and so on.

Despite the fact that IPO has been denied, Mr long did not give up the idea of landing A shares on curves.

In March 14, 2018, *ST announced a new suspension and reorganization announcement that it intends to purchase the shares of Xu Longping and Zhang Yunxue by paying cash and issuing shares.

Unfortunately, just 2 months later, in May 15, 2018, *ST announced that it had not reached an agreement with the dragon and its shareholders on terms of transaction, so it decided not to include long profit in the scope of reorganization.

In July 2018, long Li again conducted a listing guidance and registration, and launched a second sprint to A shares. But this time, it changed its face and was renamed as "Long Li De intelligent Polytron Technologies Inc" by "Long Li De packaging printing Limited by Share Ltd".

In November 30, 2018, long LEED disclosed the second IPO prospectus, and updated the prospectus at the end of March 2019, still hoping to enter the gem, and the sponsor is still Soochow securities.

About the reasons for the cancellation of the previous meeting, in the afternoon of October 21st, the economic report reporters on twenty-first Century made a public phone call in the Dragon long prospectus, but the phone showed many times that it was on the phone.

"There are many reasons for the cancellation of the audit, some of which are actively applying to the SFC for withdrawal of application materials, while others still need further verification." An analysis of a sponsor in Shanghai pointed out that "canceling the examination is similar to postpone voting. It may also encounter major unexpected events before the meeting, such as peer reporting or media coverage."

Capacity digestion challenges

In terms of operating performance, dragon's performance is not inferior.

In March 2019, the latest prospectus showed that in 2016 -2018, dragon profit achieved 585 million yuan, 642 million yuan and 861 million yuan respectively, and the corresponding net profit was 50 million 310 thousand and 100 yuan, 57 million 255 thousand and 100 yuan and 88 million 755 thousand and 800 yuan respectively.

Even if the net profit is not deducted, it has reached 43 million 627 thousand and 800 yuan, 54 million 586 thousand and 700 yuan and 83 million 561 thousand and 200 yuan in the past three years.

From the list of customers, we can see that star customers are gathering: Li Bai, Huang Ju group, YIHAI KERRY, and Huang Bai Bai, Heng An, Yi Li, Lu Hua, COFCO, Zhongyan and so on.

In 2018, for example, the top five customers of the company are the Li Bai in the field of daily chemical home, the YIHAI KERRY in the field of grain and oil, the Shanghai strong international trade Co., Ltd. in the food and beverage field, the group of Chrysanthemum in the daily chemical home, and the Whalen in the food and beverage field (Warren).

However, the high degree of customer concentration is still a "barrier" that can not go around. In the previous declaration, the Commission was concerned about the high concentration of the top five customers of the company: in 2014 -2016, its top five customers accounted for 51.7%, 56.19% and 44.57% of their revenue contribution.

Two degrees IPO, the top five customers of the dragon are still more concentrated.

In 2016, -2018 accounted for 44.57%, 51.69% and 45.6% of the top five customers, compared with 68.81%, 65.15% and 62.85% of the top ten customers in the same period.

In addition, in the feedback of IPO for the first time and the feedback of the SFC in March 2019, the utilization rate of corrugated board and the problem of new capacity digestion have attracted much attention.

From the point of view of revenue structure, dragon's "cardboard business is the main business and cardboard business is subsidiary". In 2016-2018 years, the utilization rate of corrugated boxes is 99.68%, 94.86% and 85.42% respectively, and the utilization rate of corrugated cardboard is 69.08%, 65.1% and 84.35% respectively.

It is worth mentioning that the IPO, long Li De, intends to raise about 421 million yuan, of which more than 200 million yuan will be used to expand the new capacity of the intelligent and efficient printing and molding linkage line and intelligent Internet of things and warehouse management projects, and supporting green color printing bags, intelligent manufacturing and production projects.

In the previous IPO, the Commission asked the company to "combine existing capacity, capacity under construction, and plan for production and commissioning" to show whether the new capacity can be effectively digested.

"This industry is sensitive to paper prices, low entry threshold, fierce competition, and even the risk of overcapacity." In October 21st, a paper supplier pointed out to the twenty-first Century business reporter.

In the same industry, 002303.SZ, 002228.SZ, 603022.SH and 002803.SZ have all been listed.

Although it has 191 patents as a national high-tech enterprise, long Li also admitted in the prospectus, "the packaging industry is scattered, the top 10 enterprises have less than 10% market share, low market concentration and fierce competition, showing the characteristics of low R & D capability, insufficient regulatory economy and slow transformation speed."