Strengthening Core Competence, Clothing Manufacturing Design, And So On, "To B" Enterprises Seek To Visit The Capital Market.

Over the past two years, in addition to its own brand retail apparel enterprises, some clothing manufacturers, such as apparel manufacturers, have begun to seek more capital markets for B customers.

Cool smart (plan to enter the GEM)

In May 16th, Qingdao cool intelligent Limited by Share Ltd submitted the latest prospectus to the SFC and plans to enter the gem. The prospectus shows that the company is mainly engaged in the production and sale of personalized custom garments, including men's and ladies' full range of all kinds of products, and provides the overall transformation plan and technical consultation service for the digital customization factory to the domestic related traditional manufacturing enterprises. The company's customized clothing products include men's and ladies' formal suits, including suit, trousers, vest, skirt, shirt, coat and windbreaker. The company has four series of business dress, business casual, elegant dress and fashionable mashup.

According to the prospectus, the core business mode of the company is "Customer/Business to Manufacturer + Made to Measure", referred to as C/B2M+MTM. The main business of the company is the production and sale of clothing at the core of customization. It mainly includes three modes, namely, customized ODM, customized OBM and personalized custom occupation. For the B clients at home and abroad, the company carries out production by OEM. For the C clients in the territory and the customer orders of the professional clothing group, the company produces and sells its own brand. The company's OBM private brand includes "CotteYolan", "red collar" and "Rui Pu" (collectively referred to as "own retail brand"). Among them, the main consumer groups of "CotteYolan" and "red collar" are customers who have demand for products such as formal clothing.

Prospectus shows that in 2016, 2017 and 2018, cool smart business income was 420 million yuan, 584 million yuan and 591 million yuan respectively, net profit was 22 million 803 thousand and 500 yuan, 62 million 865 thousand and 900 yuan and 62 million 730 thousand and 200 yuan respectively. The company intends to issue 60 million shares and intends to raise the amount of 418 million yuan, of which 278 million yuan is invested in the new project of Flexible Smart factory. The design capacity of the project is 278 million sets of individualized suits and 310 thousand sets of personalized shirts. Another 140 million yuan to invest in intelligent logistics warehousing, big data and R & D Center complex project, including new intelligent logistics center and big data and R & D center.

China Fashion (plan to enter the GEM)

In May 30th, Zhejiang Zhong Yin fashion Limited by Share Ltd submitted the latest prospectus to the SFC and plans to enter the gem. The prospectus shows that the company is a creative design enterprise focusing on fashion product design. At present, the company's fashion product design is mainly applied to shoe design, and it also has the pattern design business applied to the appearance of various consumer products. While providing footwear design services, the company also provides shoe shoe supply chain integration services to customers. The company's products are mainly designed for the middle end and the mass market, which are mainly used in women's shoes and children's shoes in the fast fashion field.

In 2016, 2017 and 2018, China Yin's fashionable business income was 391 million yuan, 621 million yuan and 625 million yuan respectively, of which the supply chain integration business accounted for 90.15%, 90.74% and 84.84% respectively. In terms of gross margin, the proportion of gross profit in design business accounted for 57.20%, 48.05% and 59.25% respectively in gross profit of main business. The prospectus says the design business is the core business of the company, and the supply chain integration business is the value-added service provided by the company based on the design business to the shoe customer. Design business income is relatively low, but the gross margin level is higher, gross margin is above 90%, supply chain integration business transaction scale is bigger, but gross margin level is low, gross margin is 10% or so.

According to the prospectus, the sales mode of the company's design business is mainly divided into two modes: "self design, customer direct selection style" and "customized design style according to customer needs". The former is the main selling mode of the design business of the company, and has the ability to produce more than 9000 shoe design styles annually. Customers are selected by participating in exhibitions and centralized displays. After customers pick up the styles, they purchase corresponding designs from the company and get the relevant design results of the style. The sales mode of supply chain integration business is mainly for customers to choose the shoes design style of the company after designing. If entrust the company to transform the design result into a batch of shoe finished products, the company will place the order. The company will organize the external shoe manufacturers to produce the corresponding shoes and sell them to the customers after batch purchase. The offshore market is the main source of revenue for the company. The proportion of revenues from 2016 to 2018 is over 85%. The top five customers of the company are mainly footwear companies in European countries or regions such as Poland, France and Germany.

China Yin fashion is expected to issue no more than 60 million shares. It is expected to raise 577 million yuan for design, exhibition and marketing center construction projects, annual production of 2 million pairs of shoe shoe intelligent production base construction projects, R & D center construction projects and supplementary working capital. The design, display and marketing center project will invest 269 million yuan for the company's future design, display and marketing centers in Wenzhou, Shanghai, Dongguan, Chengdu and Hangzhou.

Boni Holdings (main board of Hong Kong Stock Exchange)

On the morning of April 26th, Boni International Holdings Limited landed on the main board of HKEx, issuing HK $0.58, with a net financing of HK $112 million. The prospectus shows that the company manufactures and sells seamless and traditional close fitting clothing products, providing one-stop intimate clothing manufacturing solutions to ODM customers. It also sells brand clothing by brand "Bonnie" and "U+Bonny (Bonny lifestyle home)" through the company's retail network in China. The company manufactures seamless and traditional personal clothing, including bra, underwear, thermal clothing and household clothes, and also produces functional sportswear. According to the Sullivan report, according to the total sales in 2017, the company is the third largest seamless garment manufacturer in China, accounting for about 1.7% of the market share. The company's main ODM customers include clothing brand purchasing agents and brand holding companies themselves, serving more than 50 ODM customers. The latest data before the listing date, the company has 153 self retailing stores and 42 retail stores.

Prospectus shows that as of 2016, 2017 and December 31, 2018, Bonnie holdings's five major customers (all ODM customers) account for about 47.6%, 50.1% and 60.9% of the total revenue respectively. The largest customers account for about 17.9%, 13.5% and 21.2% of the company's total revenue respectively. The United States accounted for 19.5%, 19.3% and 12% of the total revenue of the company's ODM business in 2016, 2017 and December 31, 2018, respectively.

In 2016, 2017 and 2018, the operating income of the company was 327 million yuan, 315 million yuan and 334 million yuan respectively, with net profit of 193 million yuan, 184 million yuan and 264 million yuan respectively. The company's fund-raising plan is about HK $117 million, and about 80% (or HK $93 million 200 thousand) will be used to fund investment related to Beiyuan production base (to expand the company's seamless product capacity). About 10% (or HK $11 million 700 thousand) will be used to enhance product design and R & D capabilities. The company intends to install 20 sets of seamless jacquard special machines for product development at Beiyuan production base, and recruit more R & D personnel. About 10% will be used for working capital and general corporate purposes.

　 Jiayi Holdings (main board of Hong Kong Stock Exchange)

In February 28th, Jia Yi Holdings Limited was listed on the main board of HKEx. The prospectus shows that the company is a one-stop solution provider for bridesmaids, wedding dresses and special occasions. According to the Ipsos report, the company is the largest Bridesmaid skirt manufacturer in China in 2017, accounting for about 2.9% of the market share. Over 95% of the proceeds from the past performance record came from fashion brands, which mainly sell products to American fashion brands, including bridesmaids, wedding dresses and special occasions, and provide diversified value-added services, including trend analysis, product design and development, raw materials procurement, design and development, production, quality assurance and inventory management.

Prospectus shows that as of 2016, 2017 and March 31, 2018 and the 6 months ended September 30, 2018, the total earnings of Jiayi holdings were HK $165 million, HK $169 million, HK $208 million and HK $154 million respectively. The annual / intra profits were HK $12 million, HK $24 million, HK $24 million and HK $17 million respectively. The total revenue growth for the period ended March 31, 2016 to the end of March 31, 2018 was a compound annual growth rate of about 12.3%. As of 2016, 2017 and March 31, 2018, and for the 6 months ended September 30, 2018, most of the company's products were sold to us customers, which accounted for about 87.8%, 88.6%, 92.8% and 94.7% of the total revenue for the same period.

The company's products are divided into four categories: bridesmaids, wedding dresses, special occasions clothes and others. As of 2016, 2017 and March 31, 2018, the company's revenue was mainly generated by the sale of Bridesmaid skirts, which accounted for about 79.3%, 77.3% and 62.3% of the total revenue during the related period respectively. For the 6 months ended September 30, 2018, the company's revenue was mainly generated by sales special occasions clothing, which accounted for about 53% of the total revenue.

In June 26th, Jiayi holdings announced the results for the year ending March 31, 2019. The annual revenue of the company was HK $226 million, an increase of 8.2% over the same period last year. The profit in the year was HK $12 million 164 thousand, down 48.9% from the same period last year, excluding the one-time listing expenses, and the profit margin was about HK $32 million 800 thousand during the year. According to the announcement, the overall increase in revenue was mainly due to an increase of HK $30 million 700 thousand in sales of special occasions clothing, which was partially offset by a decrease of HK $15 million 100 thousand in revenue from the sale of Bridesmaid skirts.

Manufacturing, design, and other "to B" enterprises have become the new force of clothing enterprises.

Cool smart, Zhong Yin fashion, Bonnie holdings, including Hongkong Jiayi holdings, which are listed in several years or listed in the year, are basically manufacturers of partial manufacturing enterprises. They are mainly engaged in the production and sale of customized clothing. China fashion is a fashion product design company mainly based on shoe design. However, its supply chain integration business is the main source of its revenue. Boni holdings is mainly engaged in seamless and traditional ODM business, while Jiayi holdings is a bridesmaid skirt manufacturer. Moreover, most of these enterprises' fund-raising projects are related to the expansion of the scale of production, such as the cool smart project, the flexible smart factory new projects, the Sino Yin fashion investment marketing center, and the planned investment in the intelligent production base of shoe shoes. 80% of the funds raised by Bo Ni Holdings are used to expand the production base.

In general, in addition to private brand retail apparel enterprises, the "professional" clothing enterprises that produce design clothing enterprises or provide products or services for customers of each chain of the apparel industry chain have begun to seek more capital markets. This "to B" clothing enterprise plans to use capital strength to expand production capacity and seek more possibilities for development, such as developing its own retail brand business. From a broader perspective, in addition to traditional brand retailing and traditional manufacturing, more positioning for "new manufacturing" and "new retail" clothing enterprises to the capital market to tell the story of "tradition and innovation", and seek different parts of the capital market, is also a manifestation of the transformation and upgrading of the garment industry. However, the capital market is a market that is going to ebb and flow. It is also an amplifier of strong and weak differentiation. No matter which mode of clothing enterprises should make better use of capital strength to strengthen their core competence, it is the correct way of capital utilization.