On June 26th, 2024, Shenzhen Yuejiang Technology Co., Ltd., a company from Guangdong, submitted its prospectus to the Hong Kong Stock Exchange to seek a listing on the main board of the Hong Kong Stock Exchange under Chapter 18C of the Listing Rules. This is the third special technology company to submit its filing for listing on the Hong Kong Stock Exchange. In terms of product structure, the operating income of 10-30 billion yuan products is 401/1288/60 million yuan, respectively, and the company's overall sales reached 18,000 kiloliters, a year-on-year increase of 28.10%.

Yuejiang Technology, which had planned to list on the A-share market of the Science and Technology Innovation Board in Shanghai in January 2023, signed a guidance agreement with China International Capital Corporation (CICC) and applied for listing guidance with the Shenzhen Securities Regulatory Bureau of the China Securities Regulatory Commission. However, the company never submitted a formal application for an A-share IPO, and decided to seek a listing in Hong Kong in the first half of 2024.

Link to Yuejiang Technology's prospectus:

https://www1.hkexnews.hk/app/sehk/2024/106570/documents/sehk24062601173_c.pdf

Main Business

Established in 2015, Yuejiang Technology specializes in the development, manufacturing and commercialization of collaborative robots (commonly known as 'cobots') and holds a leading position in terms of technology.

According to the Zhoushi Consulting Report, based on the shipment volume in 2023, Yuejiang Technology ranks second in the global collaborative robot industry and first among all collaborative robot companies in China, with a global market share of 13.0%.

According to the Zhoushi Consulting Report, Yuejiang Technology is one of the few global industry participants with proprietary full-stack technology covering the entire process of collaborative robot development, including collaborative robot design and manufacturing, key component development, control system development, key algorithm development and iteration, deployment of multi-functional collaborative robots for different tasks, and AI function development.

As of June 17th, 2024, Yuejiang Technology offers a total of 27 collaborative robot models across four series, with a payload range of 0.25 kg to 20 kg, including 22 six-axis models and 5 four-axis models. Yuejiang Technology has the most comprehensive product portfolio in the global collaborative robot industry, catering to a wide range of usage scenarios in manufacturing, retail, healthcare, STEAM education, scientific research, and more. The absolute addressing accuracy of Yuejiang Technology's collaborative robot is 0.229 millimeters, with a repeat positioning accuracy of ±0.02 millimeters. All of its parameters meet the leading standards in the global collaborative robot industry. In addition, the company's proprietary SafeSkin technology for flexible electronic skin enables its collaborative robots to detect objects approaching from up to 15 centimeters away at a safe speed of 1 meter per second, which is four times the industry standard speed of 0.25 meters per second.

Yuejiang Technology's collaborative robots are mainly divided into four-axis collaborative robots (Magician series and M series) and six-axis collaborative robots (CR series and Nova series). In addition, to meet the demands of customers for different automation solutions, the company has designed and launched composite collaborative robots to address specific usage scenarios in various industries, such as palletizing, welding, mobile operations, and vocational training. During the reporting period, Yuejiang Technology sold more than 47,000 collaborative robots worldwide.

As of June 17th, 2024, Yuejiang Technology has assembled a research and development team consisting of 124 industry experts and senior engineers in the robotics industry, which accounts for more than 20% of its workforce. R&D spending increased from RMB 46.9 million in 2021 to RMB 70.5 million in 2023, representing a compound annual growth rate of 22.6%. Yuejiang Technology has obtained 186 invention patents, 302 utility model patents, and 125 design patents, some of which have been awarded authoritative industry awards:

• 'Patent collision detection method' won the 24th China Patent Excellence Award;

• 'Dynamic motion control method' patent won the 2023 Guangdong Patent Silver Award;

• The 'High Precision Tabletop Robot Structure Design Technology' patent won the 2021 Shenzhen Science and Technology Patent Award.

• The human-machine interaction technology based on electronic skin conductivity control was rated as the leading international technology by the expert group of the China Machinery Industry Federation.

Shareholder Structure

According to Yuejiang Technology's prospectus, the company's shareholders include:

Mr. Liu Peichao, with a 26.62% stake;

Yuejiang Limited Partnership (stock incentive platform), with a 3.5% stake;

The shareholders of Yuejiang Limited Partnership include Mr. Liu Peichao (53.07%, GP), LP including Mr. Liu Zhufu (0.28%), and four existing and former employees (46.65%);

Shareholders of Qinmo Limited Partnership: Mr. Liu Peichao (0.67%, GP). LP includes Mr. Lin Yongyi (15.99%), Mr. Cao Jiajun (5.84%), Mr. Zhang Tao (33.59%), Ms. Chen Qiyun (16.80%), Ms. Fan Lin (16.80%), and Zhejiang Mituo Investment Co., Ltd. (10.31%).

Mr. Liu Peichao can control 31.08% of the above total voting rights.

Lumo Limited Partnership (Equity Incentive Platform) holds 4.14% of the shares.

Shareholders of Lumo Limited Partnership: Mr. Liu Yang (9.00%, GP). LP includes Mr. Liu Peichao (1.75%), Mr. Wang Yong (24.17%), Ms. Wan Ying (0.06%), Mr. Li Liuwei (0.23%), Mr. Jiang Yu (10.62%), and 32 current and former employees (54.17%).

Qimo Limited Partnership (Equity Incentive Platform) holds 3.6% of the shares.

Shareholders of Qimo Limited Partnership: Mr. Liu Yang (1.20%, GP). LP includes Mr. Liu Peichao (69.70%), Ms. Wan Ying (1.37%), Mr. Li Liuwei (1.96%), and 33 current and former employees and their inheritors (25.77%).

Chumo Limited Partnership (Equity Incentive Platform) holds 3.23% of the shares.

Shareholders of Chumo Limited Partnership: Mr. Liu Yang (0.91%, GP). LP includes Mr. Liu Peichao (7.64%), Mr. Liu Zhufu (29.51%), and 42 current and former employees (61.94%).

Leading independent investors:

Shenzhen Capital Group investors, namely Shenzhen Capital Group, Nanshan Red Soil, and Red Soil Maker, hold 2.88%, 2.29%, and 0.88%, respectively.

Songhe Growth holds 6.03% of the shares.

Qianhai Fuzhou Asset controlled by Mr. Jin Haitao owns Qianhai Equity, which holds 5.44% of the shares.

China International Capital Corporation (601995.SH, 03908.HK) owns 4.49% of the shares through its subsidiary Zhongjin Qizhi.

Other senior independent investors:

China Internet Investment Fund's subsidiary, China Netcom, holds 3.68% of the shares.

China Merchants Capital's subsidiary, Wuxi Chanfa, holds 1.68% of the shares.

Other investors:

Mr. Xiang Guanglong, Mr. Li Zhirong, and Mr. Wang Chengshu hold 3.85% of the shares through Ningbo Companion.

Wens Foodstuff Group (300498.SZ) subsidiaries, Wenrun Zhenxin and Hengqin Qichuang, hold 2.75% and 0.05% of the shares, respectively.

CRRC Corporation (601766.SH, 01766.HK) subsidiary, CRRC Investment, holds 2.71% of the shares.

Mr. Lang Xulin holds 2.21% of the shares.

Mr. Wu Zhiwen holds 2.21% of the shares.

Hangzhou Daosheng and Zhuhai Tongdao controlled by Mr. Wu Bin hold 1.32% and 0.64% of the shares respectively.

Ms. Cai Wenjuan controls Shenzhen Qunda and holds 1.87% of the shares.

Wuxi Yunhui ultimately controlled by Mr. Duan Aimin holds 1.68% of the shares.

Shenzhen Toukong investors, Shenzhen Qianfan and Haikou Guoying hold 1.42% and 0.02% of the shares respectively.

Hangzhou Junyi controlled by Mr. Zhang Wei holds 1.4% of the shares.

Ningbo Zhuoyuan and Hangzhou Shiwei controlled by Mr. Zhang Jun hold 0.9% and 0.17% of the shares respectively.

Mr. Liu Dan holds 0.99% of the shares.

Central Plains Qianhai holds 0.96% of the shares.

Tibet Xinxingrong holds 0.96% of the shares.

Zhuhai Jiufei holds 0.71% of the shares.

Mituo Zhivuei holds 0.62% of the shares.

Ningbo Leili and Shenzhen Ouying hold 0.39% and 0.19% of the shares respectively.

Shenzhen Weijia holds 0.51% of the shares.

Hailian Zhongzheng holds 0.45% of the shares.

Shandong Huarong holds 0.45% of the shares.

Shenzhen Yanqi holds 0.45% of the shares.

Shanghai Shizhineng holds 0.28% of the shares.

Mr. Liu Simeng holds 0.2% of the shares.

Ms. Yin Guofeng holds 0.12% of the shares;

Rongyuan Tianjin holds 0.10% of the shares;

Board of directors and executives

Yuejiang Technology's board of directors consists of 7 directors, including:

• 3 executive directors: Mr. Liu Peichao (Chairman, General Manager), Mr. Wang Yong (CFO, Board Secretary and joint company secretary), and Mr. Lang Xulin (Chief Scientist);

• 1 non-executive director: Mr. Jing Liang;

• 3 independent non-executive directors: Mr. Li Yibin, Mr. Wu Haoyun, and Dr. Hou Lingling.

The supervisory board has 3 members: Ms. Wan Ying (formerly known as Wan Suping), Mr. Li Liuwei, and Ms. Ma Jingxian.

In addition to the executive directors, the senior management includes Mr. Liu Zhufu, Vice General Manager, and Mr. Jiang Yu (formerly known as Jiang Erlei), Vice General Manager.

Corporate Performance

According to the prospectus, in the past three years of 2021, 2022, and 2023, Yuejiang Technology's revenue was RMB 174 million, RMB 241 million, and RMB 287 million respectively. The corresponding net losses were RMB 41.756 million, RMB 52.477 million, and RMB 103.281 million, and the corresponding adjusted net losses were RMB 43.041 million, RMB 39.898 million, and RMB 81.817 million.

Intermediary Team

The main intermediary team for Yuejiang Technology's IPO includes Guotai Junan International and Agricultural Bank International as its joint sponsors; Ernst & Young as its auditor; Jincheng Tongda & Neal and Wilson Sonsini as its China and Hong Kong & U.S. lawyers for the Company; JunZeJun Law Firm and King & Wood Mallesons (Hong Kong) as its brokerage lawyers of China and Hong Kong; and Zuo Shi Consulting as its industry consultant.