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Yuanchen Technology's Initial Public Offering of Shares on the Science and Technology Board Listing

Date of Issue:2021-03-30  Number of visits:52

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This report is from Juling Information Network: Stock short name:Yuanchen Technology Stock code:688659
    
    Anhui Yuanchen Environmental Protection Technology Co., Ltd.
    
    ANHUI YUANCHEN ENVIRONMENTAL PROTECTION
    
    SCIENCE&TECHNOLOGY CO., LTD.(West side of Hepai Road, Zhanbei Community, Xinzhan District, Hefei City, Anhui Province)
    
    Initial Public Offering of Shares on the Science and Technology Board
    
    Listing Announcement
    
    Sponsor (Lead Underwriter)
    
    (No. 18, Meishan Road, Hefei, Anhui Province)
    
    March 30, 2021
    
    Special Note
    
    (hereinafter referred to as "Yuanchen Technology", "the Company", "the Company", "the Issuer") will be listed on the Shanghai Stock Exchange on March 31, 2021. ("Yuanchen Technology", "the Company", "the Company", "the Issuer") will be listed on the Shanghai Stock Exchange on March 31, 2021. The Company reminds investors that they should fully understand the risks of the stock market and the risk factors disclosed by the Company, and should not blindly follow the trend of "speculation in new shares" at the early stage of listing, and should make prudent decisions and rational investments.
    
    The values in this listing announcement are usually retained to two decimal places, and any discrepancies between the total and the sum of the sub-values are due to rounding.
    
    Section I. Important statements and reminders
    
    I. Important Notices
    
    The Company and all directors, supervisors and senior management guarantee the truthfulness, accuracy and completeness of the information disclosed in the Listing Announcement, and undertake that the Listing Announcement does not contain false statements, misleading statements or material omissions, and that they shall bear individual and joint legal responsibility.
    
    The opinions of the Shanghai Stock Exchange and relevant government authorities on the listing of the Company's shares and related matters do not indicate any guarantee for the Company.
    
    The Company reminds investors to read carefully the contents of the "Risk Factors" section of the prospectus of the Company published on the website of the Shanghai Stock Exchange (http://www.sse.com.cn), pay attention to the risks, make prudent decisions and invest rationally.
    
    The Company reminds investors that they are advised to refer to the full text of the Company's prospectus for any information not covered in this listing announcement.
    
    Unless otherwise specified, the definitions of abbreviations or terms in this listing announcement are the same as those in the Company's IPO prospectus.
    
    Special Notice on Investment Risks during the Initial Listing of IPO Shares
    
    The Company reminds investors of the investment risks in the initial public offering (hereinafter referred to as "IPO") and that they should fully understand the risks and participate in IPO transactions rationally. Specifically, the initial listing risks include, but are not limited to, the following:
    
    (a) Relaxation of the limit of up and down
    
    The stock bidding trading of science and technology innovation board set a wider limit of up and down, the initial public offering of listed stocks, the first five trading days after listing without the limit of up and down, after the limit of up and down 20%. Shanghai Stock Exchange main board, Shenzhen Stock Exchange main board of the new shares listed on the first day up limit 44%, listed on the first day down limit 36%, the next trading day began to rise and fall limit of 10%. The board further relaxes the limit on the increase and decrease of stocks at the initial stage of listing, which improves the trading risk.
    
    (2) Smaller number of shares in circulation
    
    At the initial stage of listing, the lock-up period for the original shareholders is 36 months, 24 months or 12 months, the lock-up period for the shares followed by the sponsor is 24 months, and the lock-up period for the off-net restricted shares is 6 months. After the issue, the total share capital of the company is 16,000.00 million shares, of which 36,396.148 million shares are in circulation under unlimited conditions, accounting for 22.75% of the total share capital after the issue, the number of shares in circulation at the early stage of listing is relatively small, and there is a risk of insufficient liquidity.
    
    (C) The P/E ratio is lower than the average level of the same industry
    
    The company is located in the industry of "manufacturing" of "special equipment manufacturing" (industry code: C35). As of March 17, 2021 (T-3 day), the average one-month static P/E ratio of the industry released by China Securities Index Co. The P/E ratio of the issue is 19.82 times (EPS is calculated based on the lower of the issuer's 2019 audited net profit before and after deduction of non-recurring gains and losses, divided by the total share capital after the issue). The Company's post-issuance diluted P/E ratio is lower than the industry average static P/E ratio for the most recent month issued by China Securities Index Co. However, there is still a risk that the issuer's share price will fall in the future, causing losses to investors.
    
    (IV) Risk of financing and financing securities
    
    Since the stocks of Science and Technology Innovation Board can be used as the underlying of financing and financing securities from the first day of listing, there may be certain price fluctuation risk, market risk, margin call risk and liquidity risk. Price fluctuation risk means that the financing and financing will aggravate the price fluctuation of the underlying stocks; market risk means that when investors use stocks as collateral for financing, they not only need to bear the risk caused by the change of the price of the original stocks, but also the risk caused by the change of the price of the newly invested stocks and pay the corresponding interest; margin call risk means that investors need to monitor the guarantee ratio throughout the trading process to ensure that it is not lower than the level of the underlying stocks. Liquidity risk refers to the fact that when the price of the underlying stock fluctuates drastically, the purchase or sale of securities for repayment and the sale or purchase of securities for repayment of securities for financing may be blocked, resulting in greater liquidity risk.
    
    3. Special Risk Warning
    
    Investors should fully understand the investment risks of the KCI market and the risk factors disclosed by the Company, and carefully read all the contents of the section "Section IV Risk Factors" in the prospectus. In particular, the Company reminds investors of the following risk factors:
    
    (A) protective equipment business-related risks
    
    1, medical protective equipment business for the temporary business and medical qualification expiration of the risk of non-renewal
    
    Protective supplies are mainly civilian masks, medical masks, medical protective clothing, meltblown fabric and nano-level PTFE coating materials, of which, meltblown fabric and nano-level PTFE coating materials are mainly raw materials for the company's production of masks, the raw materials and civilian masks do not need to obtain medical qualifications, medical masks, medical protective clothing need to obtain the "medical device registration certificate" and "medical device production license".
    
    The issuer during the epidemic through the emergency approval process to obtain a shorter period of validity of medical device registration and licensing qualifications, such qualifications will expire in April 2021, the company will not apply for renewal of medical device registration and licensing qualifications within the statutory period, medical device registration and licensing qualifications will not be renewed. The company combined with the market situation of medical protective equipment and the actual operating conditions of the company, after the expiration of the medical qualification, the issuer is no longer engaged in medical protective equipment business, that is, no longer produce medical masks, medical protective clothing products; the issuer is mainly engaged in civilian protective equipment business, that is, the production of civilian masks, meltblown cloth and nano-level PTFE coating materials. In the future, the protective equipment business will maintain a small scale.
    
    2, protective equipment-related assets have been provided for impairment, the risk of continued impairment in the future
    
    With the gradual stabilization of the domestic epidemic, the company's new protective equipment business in the industry outlook has changed significantly, the current domestic production capacity of such protective equipment, such as the phenomenon of small market demand, resulting in the company's masks, meltblown cloth production line shutdown idle, the company's protective equipment assets are subject to impairment.
    
    As of the end of June 2020, the total net book value of inventory and fixed assets related to protective gears, prepayments was RMB87,416,200, and the impairment loss was RMB45,997,000. After the impairment, the carrying value of the Company's protective equipment-related assets was RMB41,419,200. If the price of protective gears and related assets falls further or the company fails to obtain sufficient orders in the future, there is a risk that the assets related to protective gears will continue to be impaired.