On October 11, a total of five companies held an IPO hearing, but ink technology was rejected. The shareholders behind inkblot technology are well-known, including Ali, Tencent, Shengda, Innovation and Dangerous Peak. These investments mostly focus on the period between 2011 and 2015. The longest time for these investments is nearly ten years.
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For nearly three years, Beijing Ink Sciences and Technology Co., Ltd., the owner of Net Red App Ink Weather, failed to pass the pass of the Securities and Exchange Commission.
On October 11, a total of five companies held an IPO hearing, but ink technology was rejected.
The shareholders behind inkblot technology are well-known, including Ali, Tencent, Shengda, Innovation and Dangerous Peak. These investments mostly focus on the period between 2011 and 2015. The longest time for these investments is nearly ten years.
So, what are the shortcomings and risk factors of inkblot technology that are not favored by the DARC?
Fatal Hard Wound: Illegal Publishing of Internet News Information
According to public information, Ink Technology was established in 2010. Its main business is meteorological information service and advertising information service based on mobile Internet platform. Its main products are mobile tool app for inquiring meteorological information, Ink Weather App.
Inkblot technology says it has a cumulative installed capacity of 556 million in seven years, making it the leading weather software.
Prior to that, Apps such as Metro and Momo went overseas to be listed. As early as the end of 2016, after Ink Technology announced its A-share listing, there were concerns about its prospects for listing.
Inkblot Technology intends to issue no more than 10 million shares on the GEM of Shenzhen Stock Exchange, no more than 40 million shares after the issuance, and 339 million yuan for the IPO. The size of this IPO is not very large in this years IPO market.
There are three projects: one is the upgrade project of the ink weather App system, which is planned to invest 222 million yuan; the other is the ink science and technology research and development center project, which is planned to invest 677 million yuan; and the third is the supplementary liquidity, which is planned to invest 0.5 billion yuan.
On the evening of October 11, the SFC website disclosed that it raised four main questions to ink technology.
The first one is the most deadly. The Securities Regulatory Commission pointed out that the website operated by the issuer and theink weather APPhave been ordered to rectify the situation by a time limit without its permission, and the issuer has issued the drug advertisement before obtaining theInternet Drug Information Service Qualification Certificate. The publishers existing APP includes video and game programs, as well as hospital advertisements.
The second problem is hard injury. The issuer obtains user data and labels through self-collection and third-party channels, and commercializes the data. On July 16, 2019, the issuer received the Notice on Issues Relevant to the Collection and Use of Personal Information by APP Special Governance Group. The Working Group on the Collection and Use of Personal Information by APP Special Governance requests the issuer to rectify the problems existing in the collection and use of personal information.
With the wide application of mobile Internet applications (App), the phenomenon of compulsory authorization, excessive claims and over-collection of personal information has emerged intensively, and the situation of consumer personal information security protection is grim.
The Central Network Information Office, the Ministry of Industry and Information Technology, the Ministry of Public Security and the General Administration of Market Supervision jointly issued the Notice on the Special Governance of App Illegal and Illegal Collection and Use of Personal Information, which will organize and carry out a nationwide campaign to govern the illegal collection and use of personal information by App. The campaign will run through the whole year of 2019.
In this context, inkblot technology wants to go public alone, and it really attracts attention.
Internet Big Guys Overturn the Boat Collectively
Another aspect of ink technology is the luxurious list of shareholders. In addition to Jinli, the founder of inkmark technology after the 1980s, there are probably many Internet investors who invest in their shares.
The prospectus shows that Jinli, the international controller of inkblot technology, holds 34.627% of the shares directly. The second largest shareholder is Hangzhou Ali Venture Capital Co., Ltd. holding 15.5%. Tian Eye Check shows that Hangzhou Ali Venture Capital Co., Ltd. is controlled by Ma Yun, with 80% of its shares. In 2013, the company participated in the B-round financing of ink technology, with the financing amount of tens of millions of RMB.
In addition to the Ali Department, inkblot technology shareholders also include Danfeng Department (Danfeng Venture Capital, Tibet Danger Peak, Danger Peak Shenzhen), Innovation Department (Beijing Innovation, Workshop Fund), and Shanghai Shengdas subsidiary companies participating in the limited partnership of GP Shanghai Shengzi. Among them, Danfeng Department shareholders hold 18.97% of the companys shares and Innovation Department shareholders hold 8.71% of the companys shares.
Source: Ink Technology Prospectus
Source: Ink Technology Prospectus
In addition, in order to be listed, small partners of Ink Technology Choice are also very attentive. Sponsorship agencies Huatai United, Law Firm (Jindu) and Accounting Firm (Dahua) can also be called domestic head organization combination.
However, despite the prominent lineup of shareholders and intermediaries, ink technology has been rejected, which also breaks the myth that Huatai has jointly sponsored 100% of the IPO projects since 2018. Prior to the Huatai joint venture since 2018, 15 IPO projects have not been rejected, which can be called the best record.
Operations are faced with multiple risks
As for the failure of ink technology meeting, it is generally believed that this may be related to the companys dependence on a single advertising revenue, overlap between customers and suppliers, and the high proportion of affiliated transactions.
The prominent shareholders, once regarded as a big chip of Ink Technology IPO, eventually became the cause of its listing.
Ink technology and shareholders such as Ali and Tencent have a high overlap in customer, supplier and ownership structure, which makes people doubt the independence of their performance.
The prospectus shows that during the first three quarters of 2014-2017, except in 2014, Shenzhen Tencent Computer Systems Co., Ltd. was the largest customer in ink weather for three years, contributing more than 20% of its revenue on average. Alibaba Group also ranked among its top five customers for four consecutive times, especially in 2014, with 45.57% of its revenue contribution. First.
The third and fourth issues about ink technology disclosed on the website of the Securities Regulatory Commission are also related to relying on a single advertising revenue and the high proportion of related party transactions.
In fact, in the prospectus, the company clearly disclosed the above risk factors, including relatively single business risk, competition risk in the field of meteorological services, single risk of meteorological data source, high risk of customer concentration, risk caused by advertising content not meeting regulatory requirements, risk of higher proportion of related party transaction income and so on. In the fifteenth major risk factors.
Advertising + Intelligent Hardware Sales is the business model that it plans to walk on two legs. A smart hardware product named Air Fruit was launched in 2014, but five years later, its business expansion in hardware development has not improved, and even was litigated for patent disputes.
According to public data, in 2014, 2015 and the first half of 2016, the sales revenue of ink weather intelligent hardware was only 22.238 million yuan, 22.4418 million yuan and 12.102 million yuan, accounting for 4.97%, 1.79% and 1.13% of the total revenue, respectively, and never exceeded 5% of the total revenue. The revenue from advertising has remained above 98% since 2015.
According to an analyst in the computer industry of a listed securities firm, from the basic point of view of ink technology, the companys business income is single and its business can be replaced more strongly. Now all functional mobile phones have their own weather forecast function, so there is no need to download APP.
An institutional personage admits that if in order to make an IPO successful, we should try to make up for the shortcomings of its business model through various ways of performance, either explicit or implicit, and try to use high-growth performance, we cant get through this barrier of the SFC. If Internet companies want to list in A-share, they must remove the bubbles and dry up the water.
Although the IPO will be rejected, it does not mean the end of the way of Ink Technology listing. There have been many cases of Erjinggong and successful listing in A-share market.
China Securities News?? Zhou Wentian
Source: Wang Fengzhi_NT2541, Responsible Editor of China Securities Newspaper