Millet submitted a listing application to the HKEx, Lei Jun firmly controls the right to vote.

category:Internet
 Millet submitted a listing application to the HKEx, Lei Jun firmly controls the right to vote.


After the golden hill listing and the Lei Jun Department of the gathering times, thunderbolt, cheetah mobile, IPO technology and so on, this time, millet has finally become the protagonist of the capital market. On the morning of May 3rd, the millet group formally submitted a listing application to the HKEx. It is worth mentioning that, as of the signing date of the prospectus, the shareholding ratio of the executive director, the chairman and chief executive officer of the board of directors and chief executive officer of the board of directors, the board of directors and the chief executive officer, as of the date of signing the prospectus, is 31.4%, for example, the share ratio of the Lei Jun is 28%, taking into account the option pool of the total equity ESOP employee stock ownership plan. According to the prospectus disclosure, millet implemented dual equity structure, divided into class A shares and class B shares. When a shareholder votes, class a share holders can vote 10 votes per share, and class B holders can vote 1 votes per share. According to Lei Juns holding of class A and B shares, Lei Juns voting power is over 50%. In the chairmans open letter, Lei Jun stressed the business model of millet: essentially a Internet Co with mobile phone, smart hardware and IoT platform, through the iron man Triathlon business model: Hardware + new retail + Internet Services - products close to hardware cost pricing, through online and offline retail channels to product the product Deliver to the users hands and continue to provide Internet services to users. Internet service is the most profitable A week before the millet prospectus was disclosed, the Lei Jun announced a message that triggered a hot debate in the industry: the overall net interest rate after tax on the overall hardware business of millet is not more than 5% per year. This is actually millet to the outside world shows the direction of the future development, it is not a Hard Suits Inc, not simply by the hardware to obtain the main profit, but a Internet Co, by controlling the cost of hardware benefits to quickly accumulate, expand the user base, bring high activity, high conversion and continuous high retention rate of interconnection. Network user group. In the 3 - day prospectus, millet also showed that smartphone sales took up most of its revenue, but Internet service became its important source of profit. Among them, in the hardware section of the Triathlon model that Lei Jun said, smartphone sales accounted for most of the income of millet. From 2015 to 2017, smartphone sales contributed 80.4%, 71.3% and 70.3% of total revenue from smartphone sales. The prospectus also shows that millet has invested or incubated more than 90 companies focusing on the development of intelligent hardware and consumer products. They and millet jointly build a mobile phone, intelligent hardware and three layers of consumer products, that is, millet ecological chain business. In 2015, 2016, and 2017, the revenue of millet IoT and consumer products was 8 billion 690 million yuan, 12 billion 410 million yuan, 23 billion 440 million yuan, and 88.8% in 2017. The income of Internet services in the triathlon model comes mainly from advertising revenue and value-added services on online games. In 2015, 2016 and 2017, the income of millet Internet service was 3 billion 240 million yuan, 6 billion 540 million yuan, 9 billion 890 million yuan, and the annual compound growth rate was 74.7%. The gross profit was 2 billion 80 million yuan, 4 billion 210 million yuan, 5 billion 960 million yuan, and the annual compound growth rate was 69.3%. In 2017, the gross profit margin of millet Internet service reached 60.2%, which contributed to the overall gross profit of millet. In addition, the prospectus pointed out that efficient online and offline new retail system is the core component of millet growth strategy. According to the ARI consulting statistics, the companys online selling platform millet mall has become the third largest 3C and home appliance online retail sales platform in China according to the total turnover in 2017, and the number of retail stores in China (self operated, monopolized and authorized) has reached 331 at the end of March 2018. A secret of hundreds of billions of losses A group of loss data in Millet Prospectus has aroused widespread concern in the industry. Prospectus shows that from 2015 to 2017, the group produced a loss of 7 billion 600 million yuan, a profit of 490 million yuan and a loss of 43 billion 900 million yuan. As of December 31, 2017, the group had a net debt of 127 billion 200 million yuan and a total loss of 129 billion yuan. The prospectus said that this is mainly due to the large amount of fair value losses that millet can convert into redeemable preferred stock. The convertible redeemable preferred stock is designated as a liability on the consolidated balance sheet, while the fair value is added to the consolidated income statement as a fair value loss. Convertible preferred stock allows the holder to convert the preferred stock into a certain amount of shares under certain conditions, which is equivalent to the design of option on the basis of the preferred stock. When the company is in good condition, the preferred stock can be converted into common stock and enjoy the rights and interests of the common stock, and the companys operating condition is not good. At the same time, you can not convert and enjoy a fixed dividend. Convertible preferred stock gives the holder a more flexible choice of return. It can be said that the change in the fair value of convertible preferred stock is only a kind of accounting treatment, and the effect on the net profit of the company is a non cash item, which does not have an effect on the companys sustainable management in essence. In an interview in May 2nd, Li Kaifu, one of the US investors and founder of Innovation workshop, said in an interview in May 2nd that there were few large Internet companies listed in Hong Kong stocks in the past, and the investors in the Hong Kong stock market were more accustomed to measuring the value of a company with their current financial data. According to the development trend of revenue and profit data in the next few years, we should evaluate the reasonable price earnings ratio to judge the value. In particular, the fair value of the preferred stock has a lot of value added in the process of high speed development of the company, because the shareholder is not withdrawn, this part is the value growth part of the book floating to the shareholders, before IPO, it is considered as the negative debt of the company to the shareholders, and the preferred stock turns into the common stock after IPO. This part of the loss will disappear and no longer be included in the report. This process does not produce actual losses to enterprises, but rather proves the growth of company value. Therefore, unlike the usual loss of actual value, the larger the loss, the better the development of the company and the greater the value. When the US map was launched in 2016, it encountered this problem, but it still had a negative impact on the listing of Mito. Therefore, both listed companies and investors need to deal with such cognitive challenges. However, for other common stock buyers, the conversion of convertible preferred stock into common stock will increase the total number of shares, similar to Orienteering, equivalent to the same enterprise overall value corresponding to more stocks, the equity is diluted, and the price per share of ordinary shares will have a certain impact. Source: first financial daily editor: Yao Liwei _NT6056 In particular, the fair value of the preferred stock has a lot of value added in the process of high speed development of the company, because the shareholder is not withdrawn, this part is the value growth part of the book floating to the shareholders, before IPO, it is considered as the negative debt of the company to the shareholders, and the preferred stock turns into the common stock after IPO. This part of the loss will disappear and no longer be included in the report. This process does not produce actual losses to enterprises, but rather proves the growth of company value. Therefore, unlike the usual loss of actual value, the larger the loss, the better the development of the company and the greater the value. When the US map was launched in 2016, it encountered this problem, but it still had a negative impact on the listing of Mito. Therefore, both listed companies and investors need to deal with such cognitive challenges. However, for other common stock buyers, the conversion of convertible preferred stock into common stock will increase the total number of shares, similar to Orienteering, equivalent to the same enterprise overall value corresponding to more stocks, the equity is diluted, and the price per share of ordinary shares will have a certain impact.