Is red bean stock short of money? Why is the raised funds used to supplement liquidity? Once famous brand gradually declined, who should carry this pot?
Raise funds by creating a name and changing the purpose of raised funds for many times
Since its listing, Hongdou has raised 2.89 billion yuan by issuing shares for refinancing. Among them, the most was in 2016, with an actual raised capital of 1.79 billion yuan. In 2015, Hongdou just raised 783 million yuan to repay bank loans and replenish liquidity.
In 2016, red bean said that all the 1.79 billion yuan raised will be used to build the smart red bean project. However, after the raised funds have been received, Hongdou Co., Ltd. has been slow to implement the fund-raising project. As of April 2019, only 240 million yuan of raised capital has been used by Hongdou in three years.
In June 2019, Hongdou issued a notice to change the purpose of the raised funds again. The reason given is that the consumption content and consumption mode of clothing retail industry have changed fundamentally, and the original plan does not match the actual situation. After the change, it is proposed to use the raised capital of 967 million yuan, and the remaining 741 million yuan and its interest will be used to permanently supplement the working capital. It is worth mentioning that the purpose of the changed raised funds also includes spending 81 million yuan to purchase office rooms from the related party Wuxi Hongfu Real Estate Co., Ltd. as office and professional decoration business rooms of Hongdou Co., Ltd.
Only a year later, Hongdou shares changed the purpose of the raised funds again.
On June 1 this year, Hongdou issued a notice saying that it will use the raised funds of RMB 664 million and interest that have not been invested to permanently supplement the working capital. Judging from the remaining raised funds, Hongdous investment in various projects almost stagnated in the year after the last change of use.
As a result of multiple changes in the raised funds, of the 1.79 billion yuan raised by Hongdou in 2016, 1.405 billion yuan was successively used to supplement the liquidity, and 81 million yuan was used to purchase the office developed by the major shareholders enterprise. The amount used for the project is only 240 million yuan.
Red bean shares to change the use of raised funds trick has been tried and tested.
Since its listing, Hongdou shares have raised at least 1.761 billion yuan of capital, and the amount of capital used to supplement liquidity after the raising is as high as 2.18 billion yuan.
A time bomb buried in connected transactions
Judging from the slow development of Hongdous main business, the company does not need a large amount of capital to supplement liquidity.
In 2019, the operating revenue of Hongdou Co., Ltd. was 2.54 billion yuan, up 2.3% year on year; the net profit attributable to the parent company was 170 million yuan, down 18.1% year on year. This has been the decline of net profit of Hongdou stock for two consecutive years.
As of the first quarter of this year, the book cash of Hongdou shares was 1.28 billion yuan, and the trading financial assets were 440 million yuan.
What did red bean do after holding a lot of money?
In October 2018, Hongdou Co., Ltd. issued a notice saying that Hongdou Groups investment right of 600 million yuan to Jiangsu Private Investment Holding Co., Ltd. (hereinafter referred to as Sumin investment) was transferred at a price of 0 yuan. After that, the paid in amount of Hongdou shares was 300 million yuan. In November 2019, Hongdou shares transferred 6% shares of Sumin investment to Hongdou Group, the controlling shareholder, at a price of RMB 318 million. The transaction is essentially equivalent to Hongdou Group borrowing 300 million yuan from the listed company, with a term of one year and interest of 6%.
It should be noted that in the transfer agreement, Shanghai Junda also promised to compensate for the part of the company that failed to meet the promised net profit. In 2020 and 2021, the net profit attributable to the parent company of Lihe Technology Innovation Co., Ltd. is no less than 330 million yuan and 420 million yuan respectively.
The assets acquired by Hongdou from its major shareholders have not helped the business or boosted performance. On the contrary, by selling assets to Hongdou shares, large shareholders can not lose their controlling rights, but also get funds, which can be described as killing two birds with one stone.
Do not do business, support half profit by investment
In addition to trading assets frequently with related parties, Hongdou shares also uses its own financing advantages of listed companies to help the parent company achieve its financial dream.
In 2019, Hongdous performance includes a net investment income of 100 million yuan. If the investment income is deducted, the net profit contributed by Hongdous main business is only about 90 million.
The investment income of Hongdou Co., Ltd. mainly comes from two affiliated companies: Hongdou Group Finance Co., Ltd. (hereinafter referred to as Hongdou Finance Co., Ltd.) and Jiangsu AFO technology small loan Co., Ltd. (hereinafter referred to as Jiangsu AFO small loan). Hongdou shares hold 34.3% and 25% shares of Hongdou finance company and Jiangsu Afu small loan respectively. Jiangsu a Fu small loan also has a Wuxi a Fu commercial factoring Co., Ltd. Among the above companies, Hongdou financial company has the largest profit scale. In 2019, Hongdou finance company and Jiangsu Afu small loan realized net profits of 102 million yuan and 1976 million yuan respectively. The investment income contributed by the two companies to Hongdou shares is about 50 million yuan.
The advantage of this equity structure is that Hongdou Group can not only not disperse the control right, but also reduce the capital pressure, at the same time, it can make use of the more convenient financing conditions of listed companies.
Hongdous financial business goes far beyond that. In 2019, Hongdou Co., Ltd. and Hongdou Group, Jiangyin Chengxing Industrial Group Co., Ltd. jointly initiated the establishment of Wuxi Xishang bank with a registered capital of 2 billion yuan. Among them, Hongdou shares invested 100 million yuan with its own capital, with a shareholding ratio of 5%. Hongdou Group invested 500 million yuan with its own capital, with a shareholding ratio of 25%. It is the largest shareholder of Wuxi commercial bank. In total, they hold 30% shares. In September 2019, Wuxi Xishang bank obtained the reply of the China Banking Regulatory Commission on the preparation of Wuxi Xishang Bank Co., Ltd., and was officially approved for the preparation. On February 11, 2020, Hongdou Co., Ltd. has contributed 100 million yuan. On April 14, 2020, Wuxi Xishang bank was registered and established.
The investment finance business has nothing to do with the main business of Hongdou. Although the two affiliated companies have contributed a lot to Hongdous performance, the parent company Hongdou Group has benefited more. After years of development, Hongdou Group acquired the bank license by holding Wuxi Xishang bank. In addition, it also extends its reach to the insurance industry by taking a stake in lion life.
Running, pouring, dripping and leaking highlights management problems
Back to the main business of Hongdou. Intoxicated in the financial business at the same time, red bean shares main business mens wear business is almost stagnant. Compared with peers, the gross profit rate of Hongdou shares is also hard to say.
In 2019, the gross profit rate of Hongdou shares is only 30%, while that of peer listed companies is generally more than 40%. Regardless of investment income, Hongdous net interest rate in 2019 is only about 3.5%. Hailan houses net interest rate in 2019 is 14.4%.
Photo source: wind, interface news research department
On the other hand, the management of Hongdous entertainment expenses is loose. In 2019, the companys business entertainment expense was 10.998 million yuan, an increase of 31.6% year on year. In addition to the production personnel, the per capita business entertainment fee of Hongdou is 5153 yuan. In 2019, the business entertainment cost of Hailan family is 25.85 million yuan, and the average business entertainment cost for people other than production personnel is only 1722 yuan. Office expenses are similar. In 2019, the office expenses of Hongdou Co., Ltd. were 49.822 million yuan, with an average per capita of 23300 yuan except for the production personnel. In 2019, the office expenses of Hailan family will be 149 million yuan, with 9923 yuan for everyone except the production personnel.
Photo source: wind, interface news research department
Behind the serious running, running, dripping and leaking is the omission of Hongdou stock management.
The accumulation of multiple problems makes Hongdous life not easy. In the past five years, the stock price of Hongdou shares has been in a long-term downturn. On June 19, the daily closed at 3.36 yuan / share, halving its market value. Investors have chosen to vote with their feet.
Source: editor in charge of interface news: Zhang Mei_ NF2100