IPO Observation: Issues with Yawei New Materials' IPO
In the context of the "dual carbon" target, the wind power industry has experienced rapid development in recent years. However, as the industry grows, competition becomes more intense and internal conflicts become increasingly severe, affecting companies that operate in this sector.
Recently, Zhejiang Yawei New Materials Co., Ltd. (hereinafter referred to as "Yawei New Materials") updated its IPO application review dynamics on the Shanghai Stock Exchange and released a response to the first round of inquiries. The questions mainly focused on business, industry-related information disclosure, market position, and actual control person-related issues.
**Uncertainty surrounding derivative business
Yawei New Materials plans to go public on the main board of the Shanghai Stock Exchange, with a total issuance of no more than 166.8 million shares, not less than 25% of the company's issued share capital after the issuance. The underwriter is Anxin Securities.
The funds raised will be used for the construction of a composite material production base, research and development center upgrades, and replenishment of working capital.
According to the prospectus, Yawei New Materials was established on December 18, 2014. The company's main business is the research and development, production, and sales of composite materials and structural core materials for wind turbine blades.
The company's products are widely used in the production and manufacturing of wind turbine blades.
The first round of inquiries by the Shanghai Stock Exchange required Yawei New Materials to explain the specific business model and background of its derivative business, as well as the difference in product sales prices between suppliers and customers.
Yawei New Materials stated that its main products are used for wind turbine blade production, while derivative products are sold to customers at higher prices than those purchased from suppliers.
The company's revenue and net profit have both declined in recent years, mainly due to the decline in product sales prices.
Yawei New Materials' accounts receivable have also been a concern. The company's accounts receivable have consistently high levels of outstanding balances, which could have a negative impact on the company's financial situation and operating performance.