Focusing on integrated circuits, Zhenlei Technology rushed to the IPO of the Science and Technology Innovation Board

The company focuses on the R&D, production, and sales of integrated circuit chips and microsystems, and provides technical services around related products. The company's main products include terminal RF front-end chips, RF transceiver chips, and high-speed and high-precision ADC/DAC, power management chips, microsystems, and modules, etc., to provide customers with chips and microsystem products and technical solutions from the antenna to signal to process. Program. The company's products and technologies have been widely used in military fields such as wireless communication terminals, communication radar systems, and electronic systems for power supply and distribution, and have gradually expanded to civilian fields such as mobile communication systems and satellite Internet.

Financial data shows that the company's 2018, 2019, and 2020 revenues were 3,993,500 yuan, 55,449,900 yuan, and 152 million yuan; the corresponding net profit during the same period was -48,977.4 million yuan and 41.8 million yuan respectively. RMB 530,000 and RMB 76,936,600.

The issuer’s 2020 net profit attributable to shareholders of the parent company after deducting non-recurring gains and losses is RMB 72,959,200, and operating income is RMB 152,124,100. At the same time, according to the valuation level of listed companies in the comparable industry and the issuer's current trading market value and other methods, the market value is expected to be no less than RMB 1 billion, the net profit in the most recent year is positive and the operating income is no less than RMB 100 million.

Therefore, according to the listing conditions stipulated in the "Shanghai Stock Exchange Science and Technology Innovation Board Stock Listing Rules", the company meets the "2.1.2 (1)" in the listing conditions. The estimated market value is not less than RMB 1 billion, and the net profit in the most recent year Is positive and the operating income is not less than RMB 100 million”.

The proposed fundraising will be used for RF microsystem R&D and industrialization projects, programmable RF signal processing chip R&D and industrialization projects, solid-state electronic switch R&D and industrialization projects, headquarters and cutting-edge technology R&D projects, and supplementary working capital.

As of the signing date of this prospectus, Yu Faxin directly holds 28.06% of the company's shares and is the company's controlling shareholder. At the same time, Yu Faxin is the executive partner of Zhenlei Investment, Chenxin Investment, and Ruilei Investment, and indirectly controls 15.43% of the company's shares through the aforementioned partnerships. Therefore, Yu Faxin controls 43.49% of the company's shares and is the actual controller of the company.

Zhen Lei Technology admits that the company has the following risks:

(1) Risks of rapid growth in company performance and relatively small business scale

During the reporting period, the company's operating income for each period was RMB 3,993,500, RMB 55,449,900, and RMB 152,214,100, with a compound growth rate of 517.20%, and the scale of revenue achieved rapid growth.

At the same time, the company’s net profit for each period was -48,974 million, 4,185,300, and 76,936,600. Compared with comparable companies in the same industry, the company's operating scale is relatively small, and its ability to withstand operating risks is relatively small. Weak. The company's current business operation capabilities are still relatively limited. Faced with increasing customer demand, it may not be able to accept orders from all customers. As a result, some business opportunities are missed, resulting in a slowdown in the company's operating income growth rate.

(2) The risk of performance fluctuations caused by discontinuous order acquisition

During the reporting period, the company's products were mainly used in the military industry. Customers' demand for chips has the characteristics of multiple varieties and small batches, and customer orders have certain randomness. To a certain extent, the orders of company customers will be affected by factors such as the annual defense budget and terminal demand release time, and there may be a sudden increase or delay in orders. The fluctuation of customer orders will cause uncertainty in the company's delivery time of products or services, which will affect the company's business performance.

(3) Seasonal risk of performance

The company's customers have mainly affiliated units of the National Defense Science and Industry Group, and usually carry out the inspection and acceptance of products and services in the fourth quarter of the second half of the year. Therefore, the company recognizes more operating income in the fourth quarter of each year.

During the reporting period, the company’s confirmed sales revenue in the fourth quarter of each year accounted for 86.36%, 50.01%, and 51.35% of the year’s operating revenue, respectively, exceeding 50% of the annual operating revenue. At the same time, the company's employee salaries, fixed asset depreciation, and other expenses occurred relatively evenly in the corresponding year. Therefore, the seasonal fluctuation of the company's performance may lead to a lower level of profit in the first half of the year, and even seasonal losses, which put the company's operating status in a disadvantageous position.

(4) Risks of changes in taxation policies and government subsidies

In terms of corporate income tax, the company has obtained a high-tech enterprise certificate, and the company currently applies a 15% corporate income tax rate. According to relevant regulations, the qualifications of high-tech enterprises need to be reviewed every three years.

If the company cannot meet the conditions for continuing to enjoy the 15% income tax preference for high-tech enterprises in the future, it will face the risk of rising income tax expenses and falling net profit.

According to Announcement No. 68 (2019) of the Ministry of Finance and the State Administration of Taxation on the Corporate Income Tax Policy for Integrated Circuit Design and Software Industry, the company is a qualified integrated circuit design enterprise. The preferential period is calculated from the profitable year, and the first year to The second year is exempt from corporate income tax, and from the third year to the fifth year, the corporate income tax is levied at a halving rate of 25% at the statutory tax rate, and enjoys until the expiry of the term.

According to the Ministry of Finance and the State Administration of Taxation, the “Notice on Comprehensively Launching the Pilot Program for the Reform of Business Tax to Value-Added Tax” (Caishui (2016) No. 36), the company is engaged in technology transfer, technology development, and related technical consulting and technical services. Business income is exempt from VAT. According to Caishui [2014] No. XX and Kegong Caishen No. [2014] XXXX, the company's income from military research and development and production is exempt from VAT.

In 2018, 2019, and 2020, the company received government subsidies of 6,712,400 yuan, 590,100 yuan, and 3,390,300 yuan, accounting for -13.71% and 14.10% of the company's total profits in the same period. And 4.40%.

The above-mentioned preferential tax policies and government subsidies promote the company's development and business performance. The state has always attached importance to the policy support of military-industrial enterprises, and the various tax policy preferences enjoyed by the company are expected to remain continuity and stable, but in the future, if relevant national tax preferential policies change or the issuer’s tax preferential qualifications are not approved, it will bring about the company’s business performance. To adversely affect.

(5) The company's business may be subject to the risk of international trade frictions

The integrated circuit industry has experienced decades of development and has formed a specialized production model of division of labor, which mainly includes R&D and production links such as chip design, wafer manufacturing, packaging and processing, and chip testing. The company is mainly engaged in chip design and chip testing and completes the packaging and processing of some terminal RF front-end chips by itself.

For wafer manufacturing and packaging processing, the company also needs to purchase wafer and packaging processing services from suppliers.

In recent years, as international trade frictions continue to heat up, the integrated circuit industry has gradually become a key area of ​​trade frictions. The company is engaged in the development of integrated circuit chips and microsystems, and there is a risk of being affected by trade frictions. If some upstream suppliers are affected by trade frictions, restricted application areas, and other factors, and thus cannot continue to provide the company with wafer or packaging processing services, it will have an adverse impact on the company's operations and production.

Because the company's current order requirements from customers have the characteristics of multiple varieties, small batches, and a certain degree of randomness, the order requirements from suppliers also have small amounts and discontinuous purchases.

Since 2020, affected by factors such as the new crown epidemic, the production capacity of the wafer manufacturing and packaging industries has continued to tighten, and the company's upstream suppliers are at risk of not being able to provide stable supplies. If the company cannot purchase the required wafers and packaging services in time, it will adversely affect the company's operations.

(6) The company has the risk of accumulated uncovered losses

As of December 31, 2020, the undistributed profit of the company's consolidated statements was -25.01199 million, and there was a cumulative unrecovered loss, which was mainly due to the company's relatively high investment in research and development in the early stage and share-based payments.

During the reporting period, the issuer’s net profits attributable to owners of the parent company were RMB -48,977.4 million, RMB 4,185,300, and RMB 76,936,600, respectively. Net profit attributable to shareholders of the parent company after deducting non-recurring gains and losses They were -12.88 million yuan, 4.057 million yuan, and 72,959,200 yuan respectively.

The company has achieved profits during the reporting period but has not fully made up for the accumulated losses of the previous year. It may not be able to make cash dividends for a certain period in the future, and it may cause the company's business expansion, talent introduction, team stability, R&D investment, market expansion, etc. Negative Effects.