This treadmill manufacturer will go public! 84%of the employees are high school and below. It is difficult to break through the foundry situation?

During the reporting period, the independent brand of Li Xuan Movement has developed slowly, and the gross profit margin has declined year after year.

"Investment Times" researcher Li Muyang

From the wind of the Winter Olympics Valley Ai Ling's championship, to the new top Liu Genghong during the epidemic, Liu Genghong led the tide of fitness. In the first half of 2022, the hotspots of the sports and fitness industry frequently came out. With this Dongfeng, Zhejiang Lixuan Sports Technology Co., Ltd. (hereinafter referred to as Li Xuan Sports), which mainly operates fitness equipment, began to sprint the capital market.

Recently, Lixuan Sports submitted a prospectus to the Shanghai Stock Exchange. This IPO intends to disclose the issuance of RMB ordinary shares (A shares) of no more than 30.3 million shares. Equipment, 600,000 dumbbell production base projects "," annual output of 450,000 fitness equipment technology renovation projects "," R & D and office centers construction projects "," marketing network construction projects "," information upgrade construction projects "and supplementary operating funds.

Researchers for the prospectus "Investment Times" noticed that in 2019, 2020, and 2021 (hereinafter referred to as the reporting period), Li Xuan's gross profit margin was lower than the comparable company in the same industry, and it showed a decline year by year. In addition, the company's overseas sales revenue accounted for year -on -year increase, with a proportion of over 90 %. It is worth noting that more than 84%of Li Xuan Movement is high school and below.

Gross profit margin has declined year after year

The main business of Lixuan Movement is the design, research and development, production and sales of fitness equipment and related accessories. The products cover the two major categories of aerobic exercise and strength training, including treadmills, fitness cars, elliptical machines, rowing machines and dumbbells. Products. At present, the company has established stable and in -depth cooperative relationships with well -known domestic and foreign sports fitness brand companies such as Decathlon, Nautilus, and Ifit.

According to the prospectus data, during the reporting period, the main business revenue of Lixuan Movement was 1.538 billion yuan, 2.439 billion yuan, and 3.474 billion yuan, respectively, and increased by 58.58%and 42.46%year -on -year in 2020 and 2021, respectively. Among them, the company's overseas sales were large. During the reporting period, the overseas sales volume reached 1.24 billion yuan, 2.233 billion yuan, and 3.248 billion yuan, respectively, accounting for 80.64%, 91.54%, and 93.5%of the current main business revenue, and the proportion continued to rise.

However, the relevant policies of restricting imports and promoting the return of manufacturing in some overseas markets will have a certain impact on the company's business. For example, since 2019, the United States has adjusted the tariffs on fitness sports products imported from China, and has been adjusted from 4.6%in 2019 to 15%, and has stabilized at 7.5%since February 2020. In the future, changes in relevant policies or further affect the company's performance.

At the same time, the main business gross profit margin of Lixuan Movement has been declining, and it is much lower than the average value of the company. During the reporting period, the company's main business gross profit margin was 27.42%, 23.61%, and 21.45%, respectively. During the same period, the average gross profit margin of the main business of companies such as Jinling Sports, Yingpos and Shuhua Sports was 33.22%, 32.20%, and 29.06%, respectively, which was about 8 percentage points higher than Li Xuan Sports's main business.

In this regard, Li Xuan Movement explained in the prospectus that the company's gross profit margin is different from the company in the same industry, mainly due to the market positioning, sales model, and product structure of each company.

Li Xuan's excessive dependence on big customers or also leads to the low bargaining ability of the company. During the reporting period, the proportion of the total sales revenue of the top five customers in Li Xuan Movement was 84.77%, 86.99%, and 84.78%of the total operating income, respectively. , 79.51%, 76.82%.

The competition in the fitness equipment industry is becoming increasingly fierce. If the company cannot continue to maintain research and development capabilities and improve its technical level in the future, compared with other companies in the industry in the industry, it cannot maintain its advantages in technology and technology. It may cause the company's main customers to lose. On the other hand, if the demand of these major customers will change in the future, or due to poor operation, the demand will decline, and it will also directly affect the operating income of the Xuan Movement.

The main business income of Lixuan Movement is divided by the sales area (10,000 yuan)

Data source: company prospectus instructions

The number of high school education accounts for over 84%

"Investment Times" researchers checked the prospectus noticed that there were 2689 employees in Li Xuan Movement, of which 2274 were high school and below, accounting for 84.57%; 352 colleges and secondary school qualifications, accounting for 13.09%; undergraduate and above or above The number of academic qualifications is 63, accounting for 2.34%. The company's sports R & D technicians are 298 people, which may indicate that most of the company's R & D personnel are less than a bachelor's degree.

At the same time, the R & D expense rate of Lixuan Movement continued to decrease. During the reporting period, the company's R & D expenses were 53 million yuan, 85 million yuan, and 113 million yuan, respectively, accounting for 3.43%, 3.48%, and 3.21%of operating income, respectively. From the perspective of patent data, the company has a total of 138 patents, of which 22 invention patents are.

It can be seen from the company's research and development personnel academic qualifications and patents that Li Xuan's research and development capabilities are not outstanding, and the company may need to further enhance the core competitiveness. On the other hand, insufficient research and development capabilities also hinder the development of the company's independent brand. In 2020, Li Xuan Sports decided to acquire the "Yibu" fitness equipment brand -related business and operating assets controlled by Li Hongshi and Jiang Mingzhu to develop independent brand construction. However, at present, the company's production and sales business is still based on the OEM/ODM model. The company's independent brand business income accounts for less than 2%of the company's main business income.

Some peers can develop faster than the company's independent brands. For example, Jinling Sports is positioned in the mid -to -high -end market, and there is no OEM/ODM business. There are large differences from the business model and income structure of Li Xuan Movement. The gross profit margin during the reporting period is nearly 10 percentage points; Its independent brands are the lowest proportion of fitness equipment through the OEM/ODM mode, the brand premium rate is relatively high, and the profitability is strong.

In addition to the company that is mainly independent brands, other companies are also actively actively developing their own brand business. For example, after the acquisition of Sikwalk in 2020, Sanbai Shuo owns its own brand business, and related income has continued to increase, which has also pushed the company's gross profit margin. Kangliyuan has sold independent brand fitness equipment through Amazon, and its own brand income continues to grow. Due to its own pricing power, the sales gross profit margin realized in this channel has gradually increased.

The road to transforming from foundry to independent brands must go through a lot of bumps. If you want to occupy a place in the ranks of independent brands, there is still a long way to go.

Li Xuan athlete employees are divided into specific composition according to their education

Data source: company prospectus instructions

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