Recently, China Securities Regulatory Commission (CSRC) announced on its website that the 18th Issuance Review Committee is scheduled to hold the 31st 2022 Issuance Review Committee working meeting on March 17, 2022, at which time it will review the IPO of Yongtaiyun Chemical Logistics Co., LTD. (hereinafter referred to as "Yongtaiyun").

Yongtai Yun to be listed in shenzhen main board, anxin Securities as its sponsor. The company plans to raise 391 million yuan, mainly for the construction of logistics projects.

Up to the issue, the controlling shareholder of Yong Tai Yun is Chen Yongfu, who directly holds 41.08% of the company's shares; Jin Ping, Chen Yongfu's spouse, is the second largest shareholder and indirectly controls 8.41% of the company's shares through Yongtai Qintang. Together, they control 49.49% of the company's shares and are the actual controller of the company.


Hazardous chemical logistics as the main business

Yongtaiyun is mainly engaged in the cross-border logistics of chemical products. At present, the main ports served by the company are Ningbo Port, Shanghai port, Qingdao port and Tianjin port, mainly for the transportation of dangerous chemicals. During the reporting period from January to June of 2018 to 2021, the service volume of Yongtaiyun cross-border chemical logistics supply chain service is 65,064TEU, 72,701TEU, 78,953TEU and 35,442TEU, respectively. The quantity of hazardous chemicals exported were 43,954TEU, 48,524TEU, 56,941TEU and 26,741TEU, accounting for 67.56%, 66.74%, 72.12% and 75.45% of the total quantity of service containers, respectively.

At present, China is the world's largest logistics market. According to the data of the National Development and Reform Commission and the National Bureau of Statistics, during the period of 2011-2020, the continuous growth of Economic activities in China has driven the rigid demand for logistics, and the total value of logistics in the whole society has climbed from 158.4 trillion yuan to 300.1 trillion yuan, with a compound growth rate of 7.36%.

In recent years, China's chemical industry has shown a trend of steady growth, and the development of chemical industry directly spawned the chemical logistics industry, especially professional chemical supply chain logistics service providers to provide services.

According to guosen Securities Economic Research Institute forecast, by 2022, the market size of China's chemical logistics industry will reach 1.8 trillion yuan, among which the market size of third-party chemical logistics will reach 630 billion yuan, and the penetration rate of third-party chemical logistics will rise to 35%.

Among them, due to the regional approval of dangerous goods warehouse and transport vehicles, dangerous goods logistics enterprises are scattered and fragmented, and the industry is very dispersed at present.

IPO of Yongtaiyun on shenzhen Main board, focusing on cross-border chemical logistics, with lower gross margin than peers2

Gross margin declined year by year

Benefiting from the rapid development of the logistics industry, Yongtai Yun's revenue and net profit are both growing, of which more than 99% of its revenue comes from its main business, chemical supply chain logistics services. During the reporting period from January to June of 2018 to 2021, Yongtai Yun achieved total operating revenue of 668 million yuan, 827 million yuan, 952 million yuan and 798 million yuan respectively. Net profit was 52,352,200 yuan, 63,553,300 yuan, 74,208,700 yuan and 61,262,500 yuan, respectively.

In the first half of 2021, the company's revenue increased by 81.10% year on year, mainly due to the continuous shortage of transportation capacity in the international maritime market and the general increase of transportation prices. The shipping cost is the main cost of the company's cross-border chemical logistics supply chain service. The company adopts the cost-plus pricing method, and the increase of shipping cost drives the increase of revenue per case. Thus the company's main business income has been greatly improved.

In terms of gross margin, yongtaiyun's business with higher gross margin is warehousing, but the income from warehousing is relatively small. In each reporting period, the comprehensive gross margin of the company's main business is 18.60%, 17.40%, 17.84% and 16.18% respectively, among which the gross margin of cross-border chemical logistics supply chain service is 15.95%, 14.71%, 14.36% and 13.63% respectively, accounting for a decrease. And lower than the average level of comparable listed companies in the industry.

The company's cross-border chemical logistics supply chain service gross margin is mainly affected by downstream demand, market competition pattern, fluctuations of international sea freight, bargaining power with ship operators or agents and other factors. International sea freight is uncertain, and the company may face the risk of gross margin fluctuation or further decline.

It is worth noting that due to the previous yongtaiyun 4 acquisition projects, and are high premium acquisition, the total formation of goodwill 143 million yuan. During the reporting period, the net book value of Goodwill of Yongtaiyun is 130 million yuan, 141 million yuan, 141 million yuan and 140 million yuan respectively. The asset impairment losses caused by the company's provision for goodwill impairment are -468,800 yuan, -644,900 yuan, -627,500 yuan and -272,600 yuan respectively. The amount of goodwill of the company is high. There is potential goodwill impairment risk in the future.



In general, the logistics industry still has a certain growth space in the future, especially for chemical products with asset and qualification barriers. Although Yongtai Yun has a certain market position in the field of dangerous goods logistics, its gross profit rate is low. In the future, the company still needs to strengthen cost control, make full use of emerging information technologies such as the Internet of things and big data, comprehensively upgrade the existing "transportation and chemical" platform, and further accelerate the national business layout and industrial chain extension.

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