Futu News, March 8, this Tuesday.$Chaoyun Group (06601.HK) $The winning result of IPO will be released soon, and the dark trading of Futu will begin at 16:15 that day, and it will officially land on the Hong Kong stock market on Wednesday.

According to Fortune statistics, the IPO margin margin of Chaoyun Group has reached 67.52 times, with a financing subscription of more than HK $20 billion, which is expected to exceed 120 times, setting a new high for the daily chemical industry in the Hong Kong stock market and the third highest in the history of the FMCG industry, after NONGFU SPRING CO., LTD. and Pop Mart International.

Multi-category and multi-brand development, online and offline dual-core drive

It is reported that Chaoyun Group is the leading one-stop multi-category home care, personal and pet care platform in China. According to the data of Burning knowledge Consulting, Zhaoyun Group has the first market share in mosquito and insecticidal products for five consecutive years. In 2019, the market share of insecticide and mosquito repellent in China reached 22.8%, while the market share of insecticide and mosquito repellent market for children reached 41.4%, and it is an absolute oligarch in the market.

In addition, Chaoyun Group ranks second in the home cleaning and air care market, while the toilet water market ranks in the top three in the personal care industry. Newly entered the pet care industry in 2019, according to retail sales, as of September 30, 2020, Chaoyun Group ranked among the top five in the category of pet deodorant, among which "stubborn tail" became the first brand of Tmall pet perfume within 4 months of listing, and was selected into the annual list of high-quality new products certified by Tmall small black box.

In terms of business, Chaoyun Group has a multi-brand and multi-category layout, with brands such as "Chaowei", "Beibeijian", "Weiwang", "Runzhisu", "New Zealand", "Home", "DUX de" and "stubborn tail". Nearly 40% of the brands / categories have been hatched in the past year, and continue to break into the category of high gross profit, among which the pet category has developed rapidly and achieved a several-fold increase in the first half of 2020 compared with the whole year of 2019. The company's unique dealer cooperation model, "payment before goods", has also brought more abundant cash flow.

In terms of channels, Chaoyun Group has strong control over the sinking market, with more than 1200 offline dealers, 620000 sales outlets and 11000 retail outlets. The market in third-tier cities has grown at a rate of 11%. At the same time, online channels have also achieved rapid growth, with a growth rate of more than 100% for several years in a row. in the past year, it has expanded 14 self-owned stores and 20 online channels, and 2 categories have won Tmall's first place.

In terms of financial data, the company's total income from fiscal year 2017 to fiscal year 2019 was 1.346 billion yuan, 1.35 billion yuan and 1.383 billion yuan respectively, and after three years of steady growth, the company entered a stage of rapid growth in the first three quarters of 2020. in the nine months ended September 30, 2020, the company's revenue was 1.461 billion yuan, up 16.9% from the same period last year, and the net profit was 215 million yuan, up 23.0% from the same period last year.

The growth rate of the three segments is considerable.

In terms of industry, China's daily chemical industry covers four important daily necessities market segments, namely, household care, fabric care, personal care and pet care. Pet care, home care and personal care covered by Chaoyun Group's multi-category strategy, it is one of the three fastest growing segments.

China has the second largest home care market in the world, after the United States. Retail sales in China's home care industry grew from 33.9 billion yuan in 2015 to 45.8 billion yuan in 2019, corresponding to a compound annual growth rate of 7.8 per cent, much faster than the global growth rate of 3.6 per cent. Retail sales in China are expected to grow further to 69.4 billion yuan in 2024, with a compound annual growth rate of 8.7 percent from 2019.

With increasing awareness of health, health and beauty, as well as the impact of continuous market education and popular culture on social media, China's personal care market is also developing rapidly. the market size increased from 305.8 billion yuan in 2015 to 458.7 billion yuan in 2019, with a compound annual growth rate of 10.7 percent, and is expected to further grow to 701.4 billion yuan in 2024, a compound annual growth rate of 8.9 percent.

At the same time, with the release of restrictions on dog ownership in cities, the improvement of people's quality of life, and the gradual emergence of the "empty nest phenomenon", the proportion of domestic families keeping pets is increasing day by day, and the potential of the market for pet care products is also increasing.

According to the data, the retail sales of pet care products increased from 3.1 billion yuan in 2015 to 6.9 billion yuan in 2019, and is expected to continue to grow to 15.6 billion yuan in 2024, with a compound annual growth rate of 17.8 percent from 2019 to 2024.

Favoured by the management team, investor superstar Yunji Inc

After being reorganized independently from Libai Group in 2018, Chaoyun Group became an independent operation platform. CEO Chen Danxia returned to take over Gaozi after starting a business, became the helm of Chaoyun Group, and led the company to achieve reverse growth.

After independent reorganization, Chaoyun Group has a management team with an average age of about 40 years, all professional managers from BABA, leading domestic pet enterprises and Libai who have been trained for more than ten years, and have rich business experience in various industries. Strong fast category management ability.

On the other hand, the investor behind the IPO of Chaoyun Group is also superstar Yunji Inc, including Yunfeng, Hillhouse, Sequoia and other well-known investment institutions at home and abroad, as well as several high-quality international long-term funds.

With this listing in Hong Kong, the company plans to use the global sales funds to support the rapid development of the business: about 20% will be used to enhance the company's R & D capability, and about 20% will be used to improve the company's sales and distribution network. About 15% will be used in marketing activities to strengthen brand building and product promotion.

In addition, about 10% will be used to improve the efficiency and flexibility of the company's global and domestic supply chains; about 10% will be used to implement the company's digital strategy and strengthen the information technology infrastructure to improve operational efficiency; about 15% will be used for strategic acquisitions of upstream and downstream businesses; and about 10% will be used for working capital and other general corporate purposes.