License densely distributed electronic cigarette companies enthusiastic "embrace" national standards

Zhao Tong, co -founder of Shenzhen Two Fortune Technology Co., Ltd., said in an interview that with the implementation of the national standard, the electronic cigarette industry will enter the stage of legalization and standardization. At the same time, the concentration of the industry will be further improved, thereby promoting the industry further Upgrade; in addition, it will also bring demonstration and acceleration effects on the supervision of global e -cigarettes.

Author: Zou Yongqin

Figure: Tuwa Creative

Information about electronic cigarettes has recently been up.

In the first week of August, the official website of the National Tobacco Monopoly Administration added public announcements for more than 50 tobacco monopoly manufacturers. As of August 6, 2022, more than 200 companies have obtained electronic cigarette production licenses, and 55,000 merchants have obtained e -cigarette retail permits.

Among them, there are many prestigious listed companies, such as Simo International (06969.HK), the largest electronic tobacco equipment provider in China, BYD Electronics (00285.HK), which is considered a leader in the industry, and a core supporting supplier of tobacco core suppliers Jinjia (002191.SZ) and so on.

Regarding the permits of many companies at this moment, industry insiders pointed out that this is because the "Administrative Measures for Electronic Cigarettes" will be officially implemented on October 1. Among them, Zhao Tong, the co -founder of Shenzhen Two Supreme Technology Co., Ltd., said in an interview with a reporter from the Economic Observation Network that with the implementation of the national standard, the electronic cigarette industry will enter the stage of legalization and standardized development; at the same time Promote further upgrading of the industry; in addition, it will also bring demonstration and acceleration effects on the supervision of global electronic cigarettes.

License densely issued

On the evening of August 3, Simo International issued an announcement saying that after the wholly -owned subsidiary Shenzhen Weipupeli obtained a tobacco monopoly production enterprise permit on July 21, the all -funded subsidiary Shenzhen Mikel Technology, Shenzhen Mike Brothers Science and technology have also been approved by Tobacco Monopoly Manufacturers. At present, there are already three subsidiaries who have approved tobacco monopoly production enterprise permits. In this regard, Simo International said that the issuance of the above license has further enhanced its confidence in future development, and the overall production and operation of the group will be carried out according to the planned plan.

BYD Electronics was announced on August 4, and its wholly -owned subsidiary BYD Precision Manufacturing Co., Ltd. received the "Tobacco Monopoly Production Enterprise License (Electronic Tobacco Processing Enterprise)" issued by the State Tobacco Monopoly Agency. BYD Electronics said that thanks to their strong R & D and manufacturing strength, BYD Electronics has completed the declaration work in strict accordance with the prescribed process, and quickly passes the review and evaluation of the state authority. This is also the affirmation of BYD Electronics to adhere to quality and fine management.

Immediately after the evening of August 4, Jinjia also issued an announcement saying that the holding subsidiary Yunpoxing River received a license to the tobacco monopoly manufacturer issued by the National Tobacco Monopoly Agency. This is the second license obtained by Jinjia. In July, it was another subsidiary Yunshuo Technology.

The above three are just a microcosm of many license companies. Statistics show that on the first week of August (August 1st to August 6th), the website of the State Tobacco Monopoly Agency issued a public announcement of more than 50 tobacco monopoly manufacturers. As of August 6, 2022, more than 200 companies have obtained electronic cigarette production licenses, and 55,000 merchants have obtained e -cigarette retail permits.

In this regard, Zhao Tong, CEO, two co -founder of Shenzhen Supreme Technology Co., Ltd., told reporters that the value of the license is reflected in three aspects: "First, obtaining a license is the prerequisite for enterprises to legally engage in electronic cigarette operations in China. September 30, 2022 is the deadline for the transition period of the "Administrative Measures for Electronic Cigarettes". After that, if the relevant license is not obtained, the market body cannot continue to engage in electronic cigarette operations.

Secondly, obtaining a license is a manifestation of corporate strength. For the application of the license, the national tobacco monopoly competent institution has a strict process. The permit can be obtained through this process, which represents the requirements of the corporate qualifications.

Third, obtaining a license is the basis for the further development of the enterprise in the future. Getting the production license is the first step. In the future, some large enterprises may plan more long -term development such as IPOs, and these will also require corresponding approval. But production licenses are the prerequisite and foundation of these approval. "

Simo International also emphasized in the announcement that "the" Tobacco Monopoly Production Enterprise License "is the country's affirmation of Simo's past compliant operation and fine management. In the future, Simo will continue to implement regulatory requirements, standardized, orderly, orderly, orderly, or orderly. develop".

The phenomenon of more than 200 companies densely obtaining permits at this time period is that the market feels that social capital is vigorously and accelerate the pouring into the field of electronic cigarettes. However, is this really true? Will the dense obtaining permits of these companies have an impact on the original electronic cigarette competition?

In an interview with the Economic Observation Network reporter, Ke Hua, who was an executive of an electronic cigarette company in Shenzhen, pointed out that although there are indeed many social capital this year, many social capitals have poured into the electronic cigarette field, but this has nothing to do with the issuance of the current license. "Whether it is BYD Electronics or Jinjia's shares, they have laid out electronic cigarettes for several years, but they are just small and not familiar with the public. It is because the national standard of electronic cigarettes will be officially implemented on October 1. "

The national standard in Kehua's mouth refers to the "Administrative Measures for Electronic Cigarettes" released by the National Tobacco Monopoly on March 11, 2022. The measures stipulate that the relevant tobacco monopoly license must be obtained in the production, wholesale, and retail of electronic cigarettes in China, and stipulates that it will be transitional from May 1, 2022 to September 30, 2022. Ke Hua said that in accordance with the "Administrative Measures for Electronic Cigarettes", only the application and acceptance of the existing operating entities before the transition period only accepted the application and acceptance of the existing operating entity of the operating entity. The capital cigarette field is influential in the field of electronic cigarettes.

In this regard, Zhao Tong also expressed the same opinion. He emphasized that the current license application is aimed at "stock enterprises", that is, companies engaged in electronic cigarette operations before November 10, 2021, "whether BYD Electronics or Jinjia Holdings, etc. Smoke operation, but recently completed the corresponding license application based on the "Administrative Measures for Electronic Cigarettes", and there is no evidence that 'capital is accelerating the pouring into the field of electronic cigarettes'. "

Enterprise enthusiastically embrace the national standard

The formal implementation of the "national standard" of electronic cigarettes is undoubtedly a major milestone in the development of the electronic cigarette industry.

Public information shows that the "Administrative Measures for Electronic Cigarettes" was released on March 11, 2022, and was approved by the State Administration of Market Supervision and Management and the National Standardization Commission on April 12th to become a mandatory country for electronic cigarettes. Standards will be implemented from October 1, 2022, and all electronic cigarette products must be carried out in accordance with the national standard.

In this regard, Chen Bairu of Galaxy Securities stated in the research report that the policy will increase the threshold for electronic cigarettes, and the industry will focus on the head. "On the one hand, the policy directly stipulates the relevant parameter standards of electronic cigarette products, increase product research and development and production difficulties, eliminate elimination, eliminate elimination, elimination Back -behind enterprises; on the other hand, the policy and the content of nicotine content, the amount of release, and other channels are limited to a certain extent to a certain extent. Enough R & D technical strength ".

The national standard will bring a boosting role in the industry, which is basically the consensus of the market. But during the transition period before the official implementation of October 1, how should industry companies actively embrace the national standard? In other words, what measures should enterprises take to ensure that the company can adapt to the national standard and get further development?

In this regard, lawyer Chen Litong, a former Asia -Pacific regional compliance director and senior partner of the Dacheng Shanghai office in Ford Motor Company, told reporters that compliance is divided into two types, one is mandatory, one is to choose to apply, and "electronic cigarettes Administrative Measures are compulsory compliance obligations. The implementation of the "Administrative Measures for Electronic Cigarettes" will bring a unified standard for the electronic cigarette industry. Electronic cigarette companies must take the initiative to adapt and learn to achieve compliance.

"In terms of the four dimensions of the compliance itself, enterprises should first achieve compliance from laws and regulations; at the same time, establish their own compliance management around the" Administrative Measures for Electronic Cigarettes "; and according to the national standard standards, such as ISO37301: 2021" Combined The requirements of the regulatory management system and the use of guidelines to establish a corresponding management system; at the same time, we must build a compliance culture and build a full cognition from 'to me to compliance' to 'I want to be compliant'. " Chen Litong emphasized that although there are more rules, the compliance actually brings more opportunities. Electronic cigarette companies can make bigger and stronger at the requirements of the "Administrative Measures for Electronic Cigarettes".

Zhao Tong also pointed out to reporters that during the transition, enterprises should incorporate compliance management into the strategic construction of the enterprise, so as to understand policies, implement policies, and explore policies. Products for market demand. In addition, it is necessary to increase its efforts to go out of sea and further increase exports and global development. "

So, how does industry companies deal with? As the most active layout of the electronic cigarette field in the A -share market, its actions should be the most representative. On August 10, the reporter called the company as an investor for understanding.

Relevant staff of the Ministry of Securities and Securities of Jinjia said that after the national standard rules were introduced, they began to do adaptive supporting work in this area. "Take the criteria for additives as an example. The R & D team immediately made the national target product based on this new standard, and has made certain progress. "

When related companies obtained the license, they also issued a business strategy for supporting policies and embracing the national target. For example, Simo International stated in the announcement that "will resolutely support relevant national policies and operate in accordance with laws. At the same time, it will take science and technology as the driving force for the development of the enterprise, actively promote the long -term healthy development of the industry, serve global customers and users, and effectively fulfill the enterprise Responsibility and actively contribute to society. " BYD Electronics emphasizes that "under the new policy, as one of the leading manufacturers in the field of electronic atomization, BYD Electronics resolutely supports the country's relevant policies for electronic cigarettes, launched production and operation in accordance with laws and regulations, and has made positive contributions to the healthy and orderly development of the industry." Essence

Industry concentration will increase

Although the sudden volume of the current license issuance does not indicate that "capital is accelerating the pouring into the field of electronic cigarettes", the capital market's favor for the electronic cigarette industry is traceable.

For example, the main business is the R & D, production, and sales of micro -electro -sound components and electro -acoustic components (002655.SZ) when answering investor questions on the interaction platform recently that the company is related to electronic cigarettes. The business is currently being promoted. On August 3, Jinjia's interaction of the Shenzhen Stock Exchange easily stated that they were layout of the upstream, middle reaches, and downstream of the new tobacco industry chain. The upstream consumable side company has deployed atomized electronic oil, HNB flavors and new materials; midstream production and manufacturing, the company provides ODM services for well -known electronic cigarette brands at home and abroad; in the lower reaches of the industrial chain, its own new tobacco brand FOOGO is launched by FOOGO. Electronic cigarette products have continued to make good progress in terms of product reputation and market development; the Yunpuxing River in Shenzhen and Indonesia provides new tobacco supply chain business for customers at home and abroad; Hong Kong Hengtian Commercial is mainly responsible for the import and export trade of tobacco and new tobacco -related products And marketing.

Jinjia also emphasized that "the company's 2021 new tobacco business achieved revenue of 169 million yuan, an increase of 381.16%year -on -year. In the context of market development and industry compliance, the company's new tobacco business has tight opportunities to expand its business. Strive to create a new profit growth point. "

Why does Jinjia Co., Ltd. make the entire industrial chain layout on electronic cigarettes? The company's above -mentioned staff told reporters that it was because of the promising development of electronic cigarettes. "In fact, from the perspective of the development of new types of tobacco in the world, taking the United States as an example, its market is relatively large. Many research reports show that the future prospect of the domestic electronic cigarette market is also very worth looking forward to."

In recent years, the electronic cigarette industry is showing a high -speed development trend. The "2022 Electronic Tobacco Industry Export Blue Book" produced by the China Electronic Chamber of Commerce Electronic Cigarette Professional Committee shows that China's electronic cigarette industry is one of the representative industries that increased against the trend during the epidemic. Especially in 2021, the export scale of electronic cigarettes reached 1383 100 million yuan, an increase of 180%year -on -year compared with 2020, the growth rate is far exceeding the total exports of goods in the same period. At the same time, on the basis of 138.3 billion yuan in 2021, it is expected that the total export of e -cigarette exports in 2022 is expected to reach 186.7 billion yuan, and the growth rate is still as high as 35%.

What is the reason for the rapid development of electronic cigarettes in the past few years? In this regard, Zhao Tong told reporters that the three major factors of market demand, industrial chain advantages, and technological innovation play play.

He pointed out that in terms of market demand, the development of the electronic cigarette industry is based on the huge demand for electronic cigarette consumption worldwide. After 20 years of development in the atomization industry, the penetration rate of electronic cigarettes is generally only about 10%(the United States and the United Kingdom have reached about 30%), so electronic cigarettes still have huge potential development space.

In terms of industrial chain advantages, Zhao Tong believes that under the epidemic, the Chinese industrial chain, including electronic cigarettes, reflects its stable and reliable advantages, and further enhances the global influence in China.

"As for scientific and technological innovation, in the past five years, it has also been the stage of rapid development of electronic cigarette technology innovation. Technology has brought great changes in electronic cigarette products, further stimulating the improvement of global consumption demand." Zhao Tong said.

Looking forward to the future market prospects of electronic cigarettes, Chen Bairu believes that from the perspective of the international market, according to the statistics and predictions of Fhstan Sandri, the market size (ex -factory price) of the global atomized electronic cigarette industry is expected to be 25.3%of the CAGR in the next 5 years. Continue to grow, and reached US $ 28.204 billion in 2026. From the perspective of the domestic market, my country has the world's largest smoke base, and electronic cigarettes have a broad space for traditional cigarettes. With the electronic cigarette industry entering the standard development stage, the domestic market is expected to expand steadily. In the context of industry concentration, head companies will benefit full.

Liu Yang of Caitong Securities also pointed out in the research report that domestic electronic cigarette production, wholesale, and retail licenses have been steadily promoted, and the transitional market will operate steadily. It is expected that after the national standard is officially effective in October this year, the market will usher in continuous improvement. The steady development, the superior enterprise shares of various industrial links have improved, and the share of industrial technological innovation and digital development are encouraged. In the future, leading enterprises in domestic and overseas markets have broad development space. With the increase in R & D investment and product iteration upgrades, it will further consolidate enterprises Competitive barriers and improvement of profitability.

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