Futu News reported on October 30, this Friday$Yadong Group (01795.HK) $It was announced that shares will be raised from October 30 to November 6. The company plans to issue 150 million shares, of which 15 million shares will be publicly sold and 135 million shares will be sold internationally, with an issue price of HK$0.84-108 per share and 3,000 shares per lot. It is expected to be listed on November 18.

According to reports, Yadong Group is mainly engaged in designing, processing and selling textile fabrics and providing processing services to the company's customers. Textile fabric products can be divided into two categories, namely plain fabrics and corduroy fabrics, which have various colors, patterns, textures and functions.

According to the Ipsos report, in terms of revenue, the company ranked third among textile dyeing and finishing service providers in Jiangsu Province in 2019, accounting for about 0.2% of China's market value in 2019 and 1.6% of the market value of Jiangsu Province in 2019.

In terms of financial data, the company's total revenue from fiscal year 2017 to fiscal year 2019 was 662 million yuan, 861 million yuan and 867 million yuan respectively, with a compound annual growth rate of 14.44%. Net profit was 305.63 million yuan, 49,085 million yuan and 52.664 million yuan respectively, with a compound annual growth rate of 31.27%. In the four months ending April 30, 2020, the company's revenue was 166 million yuan and net profit was 2,584 million yuan. Affected by the epidemic, there was a sharp decline.

In terms of industry, the market value of China's dyeing and finishing industry increased from about RMB 374.6 billion in 2014 to about RMB 435.6 billion in 2019, with a compound annual growth rate of about 3.1%.

In light of the COVID-19 pandemic, the market value of China's dyeing and finishing industry is expected to decline from 2019 to 2020. However, as the COVID-19 pandemic is expected to be gradually brought under control (especially in Asian countries such as China and Japan) and the retail market in China gradually recovers, this adverse effect will not continue.

In the forecast period from 2020 to 2024, the market capitalization is expected to increase from approximately RMB 345.5 billion in 2020 to approximately RMB 457.7 billion in 2024, with a compound annual growth rate of about 7.3%.

In terms of fund-raising purposes, the company plans to use the net proceeds from the sale of shares for the following purposes: about 63.1% will be used to upgrade and enhance existing production lines and technical capabilities, thereby expanding production capacity and product range. About 26.9% will be used to acquire a controlling interest (if not all) of a company with an existing production plant with an annual production capacity of about 10 million meters to 15 million meters in Jiangsu Province, China to expand production capacity, and about 10.0% will be used for general corporate purposes and working capital.