Our reporter Li Qiaoyu trainee reporter Xu Linyan
Weilong, known as the "national snack", once again embarked on the road of seeking a Hong Kong stock market listing.
On the evening of June 27, according to the disclosure of the Hong Kong Stock Exchange, Weilong Delicious Global Holdings Co., Ltd. (hereinafter referred to as "Weilong") passed the Hong Kong Stock Exchange's listing hearing.
The joint sponsors of the company's listing are Morgan Stanley, CICC and UBS.
It is worth mentioning that on May 12, 2021, Weilong submitted a prospectus to the Hong Kong Stock Exchange for the first time.
On November 12 of the same year, the day before the listing materials were about to expire, the company once again submitted an application for listing in Hong Kong stocks.
This is the third time the company has been listed.
Will Wei Long finally get his wish?
Twice previously submitted listing applications
Weilong was established in Henan in 1999. After more than 20 years of development, it has become a well-known snack brand in China.
Under the reputation, Weilong's performance is also eye-catching.
From 2019 to 2021, the company's total revenue was 3.385 billion yuan, 4.120 billion yuan and 4.8 billion yuan respectively; the net profit in the same period was 658 million yuan, 819 million yuan and 827 million yuan respectively; the net cash generated from operating activities was 750 million yuan respectively. 100 million yuan, 706 million yuan and 889 million yuan.
Today, with the expansion of scale, the company also has new considerations for future development.
The content of the prospectus shows that Weilong’s purpose of raising funds this time includes upgrading production facilities and supply chain systems to improve the company’s production capacity, warehouse management and product quality; investing in or acquiring companies that have synergistic effects on the company’s business; further expansion Sales and distribution network; used for R&D activities and improving R&D capabilities; promoting digital and intelligent business construction, etc.
But compared with the success of brand promotion, Weilong's listing process can be described as bumpy.
In May 2021, Weilong completed the Pre-IPO round of financing.
At that time, it was favored by many star investment institutions.
It is reported that this round of financing was jointly led by CPE Yuanfeng and Hillhouse Capital, followed by Redshirt China and Tencent.
Since then, Wei Long has twice failed to hit the Hong Kong stock market listing, and the prospectus failed because it was not approved.
"It is not uncommon for the Hong Kong stock market to fail due to overdue." Jiang Han, a senior researcher at Pangu Think Tank, told the "Securities Daily" reporter, "Hong Kong stock listing is relatively easy and flexible, and it is relatively normal to fail without approval for more than 6 months. .Weilong is not the only company involved in the failure of the IPO in the recent period, and the failure of the listing does not mean the failure of the listing, and there is no direct relationship between the two."
Sixty percent of income comes from spicy sticks
According to public information, Weilong's main products are divided into three categories, namely seasoned noodle products, vegetable products, soy products and other products.
Among them, the most well-known category is the seasoned noodle products, namely the well-known Weilong spicy strips.
According to the data, Weilong’s revenue from seasoned noodle products increased from 2.475 billion yuan in 2019 to 2.690 billion yuan in 2020, and further increased to 2.918 billion yuan in 2021.
As of the end of 2021, the operating income from seasoned noodle products still accounted for 60.8% of the company's total operating income.
In addition, according to the prospectus, Weilong's customers are mainly online and offline dealers, and the company is highly dependent on offline dealers.
From 2019 to 2021, 92.6%, 90.7% and 88.5% of the company's revenue came from offline dealers. As of December 31, 2021, the company cooperated with more than 1,900 offline dealers, and the dealer sales network covers the whole country About 690,000 retail terminals.
"Singleness is the biggest problem of the company at present." Zhu Danpeng, an analyst of China's food industry, said in an interview with the "Securities Daily" reporter, "It can be summarized as a single category, a single channel, a single scene, a single customer and a single model. In this situation In the future, the attention and pursuit of Weilong in the capital market is difficult to meet expectations. In the future, the company can break through by adopting the 'five-duo strategy', that is, multi-brand, multi-category, multi-scenario, multi-channel and multi-consumer groups. Under the strategic layout, it is expected to increase the favor of capital to the company."
At present, Weilong has realized the risks contained in a single product. In recent years, the company's product diversification trend has been obvious, the proportion of revenue from seasoned noodle products has continued to decline, and the proportion of revenue from vegetable products has gradually increased.
The data shows that the proportion of Weilong's seasoned noodle products' revenue will drop from 73.1% in 2019 to 60.8% in 2021, and the proportion of vegetable products' revenue will increase from 19.6% in 2019 to 34.7% in 2021.
"It's not easy for Weilong to have such a strong single product, which is also a strong 'blood-making point'. The company is currently expanding its products gradually, with strong single products as support, plus more With strong channel tension, it is not too difficult to superimpose new categories at the back." Liu Chang, chief analyst of Food and Beverage of Founder Securities, told the "Securities Daily" reporter.
(Securities Daily)