As a dowry for major shareholders, Hongdou shares have become a money encircling machine

 As a dowry for major shareholders, Hongdou shares have become a money encircling machine

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.

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.

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.

First of all, it is used for financial management. Since March this year, Hongdou Co., Ltd. has issued four financial management announcements with a total amount of RMB 67000000 and a term of 90 days. In 2019, about 36 million of Hongdous investment income was contributed by financial management. In May this year, one of the reasons for Hongdous announcement of changing the use of funds was that the payment was not received in time due to the impact of the epidemic. Autumn clothing needs to be ordered in May and June, so the companys liquidity is tight. However, the epidemic broke out in February, and it should be expected that the problem of payment collection is unexpected. Why invest 67000000 yuan in financial management after March, but there is no capital to order in May?

Secondly, after 2015, the acquisition and investment between Hongdou Co., Ltd. and its controlling shareholder Hongdou Group Co., Ltd. (hereinafter referred to as Hongdou Group) are also worthy of attention, in which a time bomb is buried.

In 2015, Hongdou also invested 80% of the shares of Shanghai Hongdou Junda Asset Management Co., Ltd. (Shanghai Junda) in Hongdou Group, a wholly-owned subsidiary of Hongdou Group, for a consideration of RMB 327 million. Shanghai Junda holds 9.79% of the shares of Lihe science and technology innovation group. In 2019, Hongdou shares transferred 9.46% of Lihe Kechuangs shares held by it to CIMC Lixing (002243. SZ), and held 9.94% of CIMC Lixings shares by way of share exchange.

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.

Do not do business, support half profit by investment

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.

Hongdou Group is behind these financial businesses that Hongdou shares are involved in.

First of all, Hongdou finance company and Jiangsu Afu small loan are both listed companies associated with Hongdou Group. The shareholders of Hongdou financial company are Hongdou Group (holding 45.7%), Hongdou Group (holding 34.3%) and another listed company general shares (holding 20%) held by Hongdou Group. The equity structure of Jiangsu Afu small loan is similar. Hongdou Group directly holds 25%, and Hongdou shares and another new third board company, Taxus (430383. OC), which is controlled by Hongdou Group, respectively hold 25% and 20%.

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.

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

One of the reasons for the low gross profit margin of Hongdou stock is the serious management problems in the operation of the company.

One of the problems is pay. In 2019, the total salary expenditure of employees included in the expenses of Hongdou Co., Ltd. was 282 million yuan, an increase of 35.6% year on year. In terms of employee compensation payable, it increased from 34.48 million in 2018 to 63.8 million in 2019. At the same time, the number of employees of Hongdou in 2019 is 3758, slightly lower than that in 2018. The growth rate of salary is much higher than that of business income.

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