Recently, Tangtangga Group AGIIPlus Inc. (hereinafter referred to as “Dangdangga”) updated its prospectus with the US Securities Regulatory Commission (SEC) to be listed on the US NASDAQ IPO. Its stock code is AGII. The company expects to issue about 14 million Class A common shares, each with an initial offering price of between 6 and 7 US dollars.

According to data, Tangtangga is a company focused on providing comprehensive, one-stop agile office solutions for enterprise customers and building owners. Using its own proprietary technology, it can also provide customers with innovative integrated work solutions while also providing high-quality and flexible workspace services according to customer needs. The company's vision for the future is to build future work and connect the enterprise with technology, data, services, etc.

As of May 5, 2024, Dangdang's subsidiary had more than 16,000 enterprise customers and about 125,800 digital registered members. In the same period, Dangdongga had 3 workspaces through its subsidiaries, with a total management area of about 23,700 square meters, and about 3,767 workstations for members to use.

According to Frost & Sullivan estimates, the market size of China's work solutions industry grew steadily from 567.3 billion yuan in 2017 to 716 billion yuan in 2022, with a compound annual growth rate of 4.8%. The market size of China's office solutions industry is expected to reach 1004.9 billion yuan in 2027, with a compound annual growth rate of 7.0% from 2022 to 2027.

According to the prospectus, in 2022 and 2023, Dangdang's revenue was 506 million yuan and 319 million yuan respectively; for the same period, the corresponding net losses were 244 million yuan and 48.47 million yuan, respectively.

It can be seen from this that the company's revenue declined significantly year on year last year, and the margin of loss narrowed, but it still hasn't escaped losses.

Dangdang's revenue mainly comes from three components, namely office space rental and operating income, decoration and intelligent building technology revenue, and brokerage and corporate services revenue.

Among them, revenue from office space leasing and operation business is the company's main source of revenue. In 2022 and 2023, the revenue from this business was 431 million yuan and 290 million yuan respectively, accounting for about 85.18% and 90.91% of the company's total revenue for the year, respectively; the other two businesses accounted for a lower share of revenue.

In the prospectus, Tang Tang said that the flexible workspace industry is still in the early stages of development, and there are many opportunities, but the company is also facing competition from other office space vendors and traditional offices. For example, if some rivals have more resources, a wider business area, stronger capital, better leasing conditions, and cheaper prices, it will put intense competitive pressure on the company.

Furthermore, it was clearly mentioned in the prospectus that many of the company's customers are in major Chinese cities. If the economy deteriorates in these regions, there may be fewer customers, which will affect the company's profit situation.

In terms of the shareholding structure, the prospectus shows that before this issuance, Hu Jing held a total share ratio of 38.33% of the company's shares.

With this listing application, Dangdang plans to use about 25% to 30% of the net proceeds from this offering to strengthen the company's technical capabilities; about 25% to 30% for business expansion, including natural growth in the company's geographical coverage and merger and acquisition opportunities; and about 40% to 50% for other business purposes.