China Net Technology, July 13 (Reporter Li Ting) Recently, information on the Shenzhen Stock Exchange website shows that Shanghai Chuangmi Digital Technology Development Co., Ltd. (hereinafter referred to as "Chuangmi Digital") has changed its application for an IPO review status on the Growth Enterprise Market to "" Accepted”, and the sponsor is CITIC Securities Co., Ltd.
With the help of the Xiaomi model, Chuangmi Digital has rapidly started to produce smart cameras. Since then, new products have been launched one after another, aiming to build a whole-house intelligent service system.However, the company's core product revenue contributed more than 80%, and the new explosive products were nowhere to be seen.Joining the Xiaomi ecological chain, Chuangmi Digilink not only benefits from the Xiaomi brand and sales channels, but also suffers from problems such as low gross profit margin and high accounts receivable.
Smart camera revenue exceeds 80%, and building a whole-house smart home is just a vision
Founded in April 2014, Chuangmi Shulian is mainly engaged in the research and development, design, production and sales of smart home products, providing smart cameras, smart doors, smart cat eyes, smart doorbells, smart sockets and other products.
From 2019 to 2021, the company's main business income is 870 million yuan, 1.12 billion yuan and 1.53 billion yuan respectively, with a compound annual growth rate of 32%.During the reporting period, the net profit was 60.42 million yuan, -88.13 million yuan and 26.63 million yuan respectively. The net profit attributable to the owner of the parent company after deducting non-recurring gains and losses was 23.38 million yuan, 53.03 million yuan and 110 million yuan respectively.
Although Chuangmi Digital Alliance claims to build whole-house smart home products, in fact, the smart camera of the fortune product has always been the mainstay of revenue.During the reporting period, the sales revenue of the company's smart cameras was 760 million yuan, 1 billion yuan, and 1.29 billion yuan, respectively, and the growth rate dropped from 34% in 2020 to 28% in 2021. were 87%, 89% and 84%.The company did not launch products such as smart watches, smart doorbells, and smart doors until 2020, and each category accounted for less than 5% of revenue.
Data from iResearch cited in the prospectus shows that China’s home camera shipments will be 40.4 million units and 46.5 million units in 2020 and 2021, respectively, while Chuangmi’s smart home camera shipments will be 8.04 million units and 10.28 million units in the same period. Taiwan, with a market share of 19.9% and 22.1%.
The company's sales model is divided into Xiaomi model and its own brand sales model.In each period of the reporting period, the related sales between the company and Xiaomi Group were 780 million yuan, 850 million yuan and 920 million yuan respectively, accounting for 89%, 76% and 60% of the company's operating income in each period.Under the Xiaomi mode, it mainly sells Xiaomi brand products, covering Xiaomi's own platforms such as Xiaomi Mall and Mijia APP, as well as Xiaomi offline channels and third-party platforms and other sales channels.
Chuangmi Digital Union mainly purchases raw materials through direct procurement and OEM procurement mode. The production of products mainly adopts the method of entrusted processing, and there is no self-built production base.
Trapped in the Xiaomi ecological chain, the gross profit margin is lower than that of comparable companies
With the help of Xiaomi's brand and channels, Chuangmi Digital is also subject to the Xiaomi model.In the prospectus, Chuangmi Digital Federation admitted that Xiaomi Group may have adverse effects on the company through equity relations, sales cooperation, benefit distribution, supply chain management and costs.
According to the prospectus, Deng Hua, chairman of Chuangmi Digital Federation, holds a total of 20.03% of the shares and is the company's largest shareholder.Xiaomi Group holds an 8.52% stake in the company through Tianjin Jinxing, which it controls.Tianjin Venus recommended Jiang Wen, a partner in the strategic investment department of Xiaomi Group, as the director of Chuangmi Digital.
The gross profit margin of Chuangmi digital products is low under the Xiaomi model.The gross profit margin of the Xiaomi model was 14%, 18% and 20%, respectively, while the gross profit margin of the company's online sales model was 27%, 21% and 28%, respectively.
Regarding the difference in gross profit margin of different channels, Chuangmi Digital Union explained that it is mainly related to factors such as product positioning, revenue sharing and sales channels.The overall scale of the company's sales to Xiaomi is large and the models are concentrated, and the final sales of Xiaomi brand products are realized through the sales channels of Xiaomi Group, and the relevant sales expenses are mainly borne by Xiaomi.
Compared with comparable companies EZVIZ Network, XGIMI Technology, and Stone Technology, Chuangmi Digital has a lower gross profit margin. From 2019 to 2021, the gross profit margin of its main business is 15.5%, 17.99% and 19.75%, respectively.According to Chuangmi Shulian's explanation, the main reason is that part of the company's profits are shared by Xiaomi Group, and the unit price and gross profit margin of products are not as good as those of the above-mentioned companies.
The average selling price of Chuangmi's smart cameras is about 120 yuan, and the gross profit margin in 2021 is 21%, compared with 16% and 18% in the previous two years.The average unit price of products such as smart watches, smart doorbells, and smart cat eyes does not exceed 1,000 yuan.
The profit is meager, and Chuangmi Digital Union strictly controls the cost.The company's expenses during the period were 110 million yuan, 280 million yuan and 230 million yuan respectively, and the expense ratios were 12%, 25% and 15% respectively.
Among them, the R&D expense rate only accounts for about 5%, which is lower than the average of comparable companies in the same industry.As of the end of 2021, Chuangmi Digital has a total of 180 R&D personnel, accounting for 54% of the company's total employees.
The book value of the accounts receivable of Chuangmi Digital Union is 140 million yuan, 200 million yuan and 240 million yuan respectively, accounting for 39%, 40% and 27% of current assets respectively.Among them, it is mainly concentrated in Xiaomi Group, with 140 million yuan, 170 million yuan and 180 million yuan respectively.Chuangmi Digital's 2021 accounts receivable turnover ratio is 6.94, much lower than the average of 31.16 for comparable companies in the same industry.
The company plans to issue no more than 40.01 million RMB ordinary shares this time, accounting for no less than 10% of the total share capital after the issuance. The total amount of funds planned to be raised is 644 million yuan, which is planned to be used for a new generation of smart home industrialization projects, creating rice. Cloud platform development projects and R&D center construction projects.
Driven by AIoT, 5G, and cloud computing technologies, the application of home scenarios has gradually matured, and well-known companies such as Apple, Huawei, Haier, and Midea are competing to enter the market.IDC predicts that by the end of this year, the penetration rate of smart solutions in the whole house will increase to about 2%, and the number of landing sets is expected to double from 2021.Chuangmi Digital Alliance relies on a single category and Xiaomi model, which is still far from the whole house intelligent platform.
China.com technology reporters sent a letter to Chuangmi Digital about issues such as low gross profit margin and the revenue structure distribution of smart home products in the whole house, but no response was received as of press time.
