On the evening of January 4, Jin Dawei (002626. SZ) disclosed that the company received a review inquiry letter issued by the Shenzhen Stock Exchange due to the issuance of convertible bonds. It is reported that Jindawei plans to issue convertible bonds of no more than 1.824 billion yuan to non-specific investors for the construction of four projects and replenishment of liquidity.
Titanium Media APP noticed that among the above 1.824 billion yuan, the use of 1.7 billion yuan of fundraising was questioned.
In the secondary market, as of the close of trading on January 5, Jindawei's share price closed at 16 yuan, down 1.84%, with a total market value of 9.759 billion yuan.
A number of fundraising projects have been questioned
According to public information, Jindawei is mainly engaged in the research and development, production and sales of nutritional and health food (including nutritional and health food raw materials and nutritional and health food terminal products) and feed additives, and its main products include vitamin A series, coenzyme Q10 series, etc. Overseas market revenue is the company's main source of income, accounting for more than 8%.
In recent years, Jindawei has fallen into the dilemma of sluggish revenue growth and declining net profit. In this context, Jindawei began to expand new products, and half of the company's investment funds raised this time were used to develop new products.
As of September 30, 2023, the company's total assets and net assets are 5.365 billion yuan and 3.884 billion yuan, respectively. If the upper limit is 1.824 billion yuan, the proportion of raised funds to total assets and net assets is 34% and 47% respectively, which shows that the company's private placement is large.
Jindawei is involved in the construction of a total of 4 projects, except for the "information system construction project", the remaining three projects have been concerned.
Specifically, the "Coenzyme Q10 Reconstruction and Expansion Project" (hereinafter referred to as Project 1) plans to expand the production of the company's existing product Coenzyme Q10, while the "annual output of 10,000 tons of calcium pantothenate construction project" (hereinafter referred to as "project 2") and "annual output of 30,000 tons of allulose and 5,000 tons of inositol construction project" (hereinafter referred to as "project 3") The main products of calcium pantothenate, allulose and inositol belong to the company's new products.
It is worth noting that Jindawei has not directly sold related products to the outside world before, and at present, allulose has completed the pilot test, and calcium pantothenate and inositol have completed the small test. Project 2 and Project 3 invested a total of 913 million yuan to raise funds, accounting for half of the total amount of fundraising, whether the above two fund-raising projects belong to the main business, the company needs to combine the project 2, project 3 to produce product application fields, technical reserves and market digestion and other conditions for further explanation.
Although the coenzyme Q10 produced by project 1 is an existing product of the company, its revenue proportion is not high, and the sales revenue accounts for about 20%, and the revenue of this product shows a fluctuating trend. From 2020 to 2022, the company's coenzyme Q10 revenue was 740 million yuan, 891 million yuan, and 705 million yuan respectively, and the revenue of this product declined in 2022, with a decline of 21%.
In addition, the gross profit margin of the product has also continued to decline. From 2020 to the first three quarters of 2023, the gross profit margin of coenzyme Q10 was 77.57%, 75.75%, 64.63%, and 54.79% respectively, showing four consecutive declines.
The main reason for the decline in gross profit margin is that the sales unit price of coenzyme Q10 has increased significantly since the fourth quarter of 2020, which has been popular in the market, and the subsequent price has gradually returned to rationality. During the corresponding reporting period, the sales unit prices of coenzyme Q10 were 2412.34 yuan/kg, 2454.94 yuan/kg, 1799.75 yuan/kg, and 1312.89 yuan/kg, respectively. In the case of continuous decline in product prices, the necessity and rationality of the company's implementation of project one have attracted attention.
Dividends are paid out first, and then funds are raised to replenish the flow
In recent years, due to the continuous decline in the price of vitamin A, the price of coenzyme Q10, and the impact of goodwill impairment losses caused by the operating performance of Chengxin Pharmaceutical, a holding subsidiary, which did not meet expectations, Jindawei's operating performance declined.
Specifically, Jindawei's operating income fell from 3.504 billion yuan in 2020 to 3.009 billion yuan in 2022, and its net profit fell from 959 million yuan to 257 million yuan, and the company's net profit declined significantly.
In the first three quarters of 2023, its revenue increased slightly by 0.69% year-on-year to 2.321 billion yuan, and its net profit continued to decline, down 30.17% year-on-year to 243 million yuan.
Although Jindawei's net profit has declined, this does not affect the company's dividends. From 2020 to 2022, the company's dividend ratio gradually increased, from 38.15% in 2020 to 47.5% in 2022. In the past three years, the company's cumulative dividend amount has reached 854 million yuan.
As of September 30, 2023, the company's top two shareholders, Xiamen Jindawei Investment Co., Ltd. and China Animal Husbandry Industry Co., Ltd. (hereinafter referred to as China Animal Husbandry Co., Ltd.), have a cumulative shareholding ratio of up to 54.03%, and half of the dividend amount falls into the pockets of the above two shareholders.
In addition, Jindawei's second largest shareholder, China Animal Husbandry Co., Ltd., has been selling off the company's shares in recent years. As the founding shareholder of the company, the animal husbandry shares initially held 26.47% of the shares of Jindawei, after several rounds of reductions, the shareholding ratio of animal husbandry shares has dropped to the latest 18.68%.
The latest reduction of China Animal Husbandry shares is from September 11 to November 28, 2023, with a total of 5.4228 million shares reduced and about 98.8 million yuan cashed out. According to the statistics of Titanium Media APP, since the first reduction of animal husbandry shares in 2017, its cumulative cash amount has exceeded 900 million yuan.
After the shareholders paid large dividends and reduced their holdings to cash out, Jindawei began to plan to raise funds to replenish the flow, and planned to use 470 million yuan to raise funds.
As of September 30, 2023, the closing balance of the company's monetary funds was 579 million yuan, while the company's short-term borrowings and non-current liabilities due within one year totaled 162 million yuan, and the company's current monetary funds can still cover short-term debts.
During the same period, the company's asset-liability ratio was 27.6%, down 4.1 percentage points from the beginning of the year, and the company's current ratio and quick ratio both improved compared with the beginning of the year, which shows that the company's short-term solvency is acceptable. Based on this, the necessity of Jindawei's replenishment is debatable. (This article was first published in Titanium Media APP, author|Li Ruohan)