Key dates:
Public sale deadline: March 5, 2018 12:00 noon
Public Notice Application Results: 2018/3/12
Listing date: March 13, 2018
Exclusive Sponsor:
China Merchants Securities (Hong Kong) Limited
Statistical data summary:
Number of shares offered: 194,183,990 shares
Percentage of shares offered in Hong Kong: 10.0%
Offer Price: HK$2.28 to HK$3.28
Estimated amount raised: HK$4.43 billion to HK$637 million
Admission fee per hand: HK$3,313.05
Group Overview
The Group's main business is online integrated online jewelry retail. The main sales channels are self-operated online platforms, including www.csmall.com, m.csmall.com, and cSmall (this is a mobile application); in addition, the Group also uses third-party online sales and the Group's offline retail and experience networks as sales channels. According to Frost & Sullivan, based on sales revenue in 2016, the group is the largest online jewelry retailer in China, with a market share of 5.3%.
In terms of product mix, the sale of gold products is the group's main source of revenue. In the 10 months ending October 31 last year, this type of product accounted for more than 80% of total revenue. Among them, the main gold products sold were gold bars, which accounted for nearly 67% of total revenue during the period.
Industry Overview
According to Frost & Sullivan's report, the domestic jewelry retail market has continued to grow in recent years. In 2016, this market revenue was 708 million yuan, and the compound annual growth rate from 2012 to 2016 was about 8.3%. The report predicts that this market will continue to grow similarly from 2016 to 2021, and the expected compound annual growth rate during the period is about 7.9%.
In contrast, the domestic online jewelry retail market is clearly growing faster, with a compound annual growth rate of 34.1% from 2012 to 2016; the report expects to maintain a double-digit annual growth rate from 2016 to 2021, with a compound annual growth rate of about 24.0%.
Risks
The Group's online sales channels are regulated by domestic law and government. Due to the rapid development of domestic online retail, new laws and regulations may be adopted from time to time, and groups are required to obtain licenses and permits not currently held. If the group fails to follow up and respond in a timely manner, the operation of the group may be disrupted.
valuations
According to the prospectus, as of December 31, 2017, based on the calculation of 1,023 million shares to be issued as expected after the stock offering was completed, the Group's estimated profit per share without review was not less than RMB 0.09, and the price-earnings ratio range from corresponding unaudited notes was 20.5 times to 29.6 times. (Calculated at the exchange rate of 1 HKD to $0.8109)
