This report is read as follows:

It is estimated that the IPO offering price of Shenglan shares is 10.01yuan.

Summary:

According to the letter of intent of Shenglan shares, the company's IPO expects to raise 321.5966 million yuan, offering underwriting and other expenses totaling 51.0757 million yuan, totaling 372.6723 million yuan. In the audited 2019 annual report, the net profit attributable to the owner of the parent company is 75.5005 million yuan after deducting non-recurring profits and losses, and the diluted EPS is 0.51 yuan. It plans to issue 37.23 million shares, which is calculated at a price of 10.01yuan per share based on the total amount of capital raised, and the corresponding PE is 19.74 times.

Corresponding to China Securities Industry (C39) nearly a month static PE is 43.19 times, Shenglan shares raising price corresponding to PE lower than industry PE, do not consider postponing the issue, it is estimated that Shenglan shares IPO offering price of 10.01yuan.

Shenglan Co., Ltd. is a leading manufacturer of electronic linkers and precision components in China. The company's main products are used in consumer electronics, new energy vehicles and so on. The company's consumer electronics products include consumer electronic connectors and components and optical lenses, of which consumer electronic connectors and components account for 75.90% of revenue and optical lenses account for 12.40% of revenue. The company has the ability to produce connector assembly terminals and plastic shells in large quantities. Connector products are mainly supplied to primary and secondary suppliers of downstream mobile phones, computers and other terminal application brands, including Lixun Precision, Foxconn and Sanno Group. The company's biggest customer is Lixun Precision, whose sales accounted for 11.64% of the total revenue in 2019, and the cooperative relationship is stable. In 2017, the company began mass production of USB Type-C-related connector products, and directly supply XIAOMI and other terminal brand customers. The company's optical lens revenue has increased rapidly in the past three years, with an average annual compound growth rate of 70.31% from 2017 to 2019. At present, the main customers are Jufei Optoelectronics, Zhaochi shares, TCL and so on. From the perspective of global and domestic industry development, the connector market as a whole shows a trend of sustained growth, and is expected to maintain steady development in the future.

Taking into account the disclosure of the prospectus and the above analysis, we choose 002475.SZ, 002897.SZ, 603633.SH and 002179.SZ as comparable companies with an average price-to-earnings ratio of 35.00. According to the reverse calculation of the amount of capital raised as announced in the letter of intent, the issue price of Shenglan shares is 10.01yuan, corresponding to the 2019 annual report of the return of the net profit PE is 19.74. the valuation of Shenglan shares is lower than the industry PE and the average PE of comparable companies, and the offering is not expected to be delayed. It is estimated that the total share capital after the issue will not exceed 149 million shares, and the market value after the issue is estimated to be 1.49 billion yuan.

Risk hints: (1) the release rhythm of IPO is delayed by force majeure; (2) Sino-US trade friction and the risk of decline in the prosperity of the consumer electronics industry.