Apply To Save The Shares Of Eurasia Group?

Recently, Changchun Eurasia Group Co., Ltd. (hereinafter referred to as "Eurasia Group") announced that in order to further expand business scope, enhance the competitiveness of the industry and promote regional economic growth, the company recently submitted a request to the relevant departments of Jilin Province and Changchun municipal government on supporting the company to apply for business qualification of duty-free commodities.

Eurasia Group said that at present, the relevant work is still in the initial stage of application, the company has not received any relevant documents from government departments, has not conducted business negotiations with any customers or partners on the operation of duty-free commodities, and has not signed any contracts or agreements. The business qualification of duty-free goods belongs to the franchise qualification, and there is great uncertainty whether the company can obtain the qualification ultimately. At present, the company's main business is still the retail business of taxable goods, and there will be no significant changes in the short term.

It should be noted that the day before, Dashang also announced that the company and its controlling shareholder, Dashang group, submitted a request to the relevant departments of Liaoning Province and Dalian municipal government on supporting the company to apply for the operation qualification of duty-free products.

On the evening of June 9, Wangfujing announced that it had won the eighth tax-free license in China, becoming the first department store enterprise to obtain the tax-free license in China, and then set off a "tax-free upsurge" in the industry. The controlling shareholders of Bailian shares, Bailian Group and Hubei Wushang a, etc. announced their application for tax-free commodity business qualification.

In addition, investors of many enterprises have asked the company whether it has plans to apply for the operation qualification of duty-free products on the platform. Hangzhou Jiebai issued an announcement in response to which it said, "the company has not obtained the operation qualification of duty-free products and there is no relevant planning in the near future". The Director Secretary of Chongqing department store said, "neither the company nor the major shareholder business groups have the qualification to apply for duty-free products" In response to investors, Nanning Department store said that "the company still needs to implement further policies to apply for tax-free shop license", and Hefei Department Store official said: "it has not held a tax-free license yet.".

It should be noted that most of the enterprises that have recently announced their involvement in duty-free business are traditional department stores. In this regard, some people in the industry say that there is a big convergence between the categories and levels of duty-free goods and those operated by department stores, and that department stores can quickly cut into the business of duty-free stores.

In fact, department stores rush for tax-free licenses, which is closely related to the downturn of the industry. In recent years, the performance of department stores has been under pressure, and less than 30% of enterprises can achieve double growth of revenue and profit. Under the impact of the epidemic situation, department store operation is even worse, and duty-free shops have the potential to increase revenue and profit. Therefore, many people think that duty-free stores may become the "lifesaving rice straw" of department stores.

However, it is not easy for general merchandise to carry out duty-free business. At present, there is uncertainty in the approval of the business qualification of duty-free products such as Bailian Group and Dashang Stock Co., Ltd., and even if it is finally approved, the relevant business will not start immediately.

Taking Wangfujing as an example, it announced the qualification of duty-free products on the evening of June 9, and set up a duty-free operating company one month later. As the tax-free operating company has not yet carried out specific business, Wangfujing is unable to predict the impact of the investment on the company's future financial situation and operating results.

In addition, the tax-free business will not have an "immediate effect" on the performance improvement of department stores. How long it will take for the revenue to be realized and how much growth it can bring is still uncertain.