Robot company raised 1.5 billion in 8 years, backed by SoftBank, is there a "bubble" in the IPO of Jieka to expand production tenfold?

Is it reliable to burn money to grab the market?

Author | Yu Wei

Editor丨Li Baiyu

Source | Yema Finance

Collaborative robots are increasingly used in mechanical work such as polishing, assembly, transportation, and sorting.

As a new branch developed from the field of industrial robots, collaborative robots are characterized by their ability to interact at close range with humans in a common work space. The most common collaborative robot is the "robotic arm" in industrial production.

As the aging of the domestic population intensifies and the birth rate decreases, the domestic working-age labor force decreases, the manufacturing industry recruits difficulties, and labor costs increase. Collaborative robot products can help companies reduce costs and increase efficiency.

According to statistics from the Advanced Industrial Research Institute (GGII), The unit time cost of collaborative robots in 2021 is only about 6.59 yuan/hour, while labor costs have risen to 37.88 yuan/hour, which is nearly 6 times the former. With the reduction of collaborative robot manufacturing costs and the increase in labor costs caused by the aging workforce in the future, the unit cost difference between the two will continue to expand.

Therefore, many companies have begun to invest in the collaborative robot business, and this field has also been sought after by capital. Since 2020 alone, there have been more than 20 investment and financing events exceeding 100 million yuan.

With the need for capital exit and the fierce competition for market share among collaborative robot companies, many companies in the industry have begun to set their sights on the secondary market, and Jieka Shares is one of them.

Recently, Jieka Co., Ltd. submitted a "Prospectus" on the Science and Technology Innovation Board. Can this collaborative robot manufacturer, which is optimistic about more than ten investment institutions at the same time, win the favor of the secondary market?

Loss of 25 million in 3 years, IPO expansion of production 10 times

Jieka Co., Ltd. is mainly engaged in the research and development, production and sales of collaborative robot products, and is engaged in the robot system integration business including integrated equipment and automated production lines.

Its products are mainly used in intelligent manufacturing fields such as auto parts, 3C electronics, semiconductors, precision manufacturing, new energy, etc., as well as consumer service fields such as retail, logistics, education, and medical care. Customers served include Toyota, Dongshan Precision, CRRC, Xingyu Corporation, Luxshare Precision, Schneider, Flextronics and other companies.

Source: Jieka Shares "Prospectus"

Since the domestic industrial robot market started late compared with manufacturing powers such as Germany, Japan, and the United States, only began to accelerate the process of independence in 2013. Therefore, each company has invested in early R&D costs. All are relatively high. This is especially true for Jieka shares.

Research and development is a money-burning matter. The "Prospectus" shows that from 2020 to 2022 (hereinafter referred to as the "reporting period"), the research and development expenses of Jieka Shares were 18.0149 million yuan, 26.852 million yuan, and 47.5092 million yuan respectively. , R&D expense rates are 37.31%, 15.27%, and 16.92% respectively.

The average R&D expense rates of comparable companies in the same industry during the same period were 6.57%, 6.67%, and 2.61% respectively.

Zhang Bing, who has been paying attention to the collaborative robot industry for a long time, once told "Bullet Finance" that the annual salary of a relatively mature collaborative robot algorithm engineer in an enterprise needs to be at least 500,000 yuan/year. Jieka's R&D expenditures also mainly come from employee salaries, accounting for more than 70%.

Long-term high investment in R&D is also intuitively reflected in patent results. As of March 31, 2023, Jieka has obtained 39 authorized invention patents, 107 utility model patents, and 39 software copyrights.

However, the operating income of the card-saving robot during the reporting period was only 48 million yuan, 176 million yuan and 281 million yuan.

The net profits were -23.9578 million yuan, -7.2331 million yuan, 5.7357 million yuan respectively, 3 Annual loss is 25 million yuan.

If the impact of exchange gains and losses is excluded, the net profit of Jieka Shares will continue to be negative, which are -26.0736 million yuan, -18.2744 million yuan, and -29.9219 million yuan respectively.

In addition to poor profits, the cash flow generated by Jieka's

operating activities during the reporting period also showed continuous net outflows, which were -42.3878 million yuan, -35.5942 million yuan and -105 million yuan during the reporting period. , with a net outflow of 183 million yuan in three years.

Jieka Shares mentioned in the "Prospectus" that if the company's negative net cash flow from operating activities in the future cannot be effectively improved, the company will face certain risks in capital turnover, which will then affect production and operation. adversely affect performance.

Therefore, choosing to go public to raise funds now is also an important move for Jieka Shares to transfer capital risks.

But it is worth noting that Jieka shares plan to go public to raise 750 million yuan, of which 420 million yuan will be used to expand the annual production capacity of 50,000 sets of intelligent robots. However, the company’s collaborative robot production capacity in 2022 There are only 5,000 units, and the production and sales rate is 78.44%. How to digest the 10-fold expansion of production?

Jiang Han, a senior researcher at Pangu Think Tank, said that intelligent robots are a market with broad prospects, but the current demand is still relatively limited. For Jieka shares, the pressure is actually huge. Raising capital to expand production may be due to its own market direction and demand, but whether it can truly realize these needs, truly generate sales, and even generate profits, this is the biggest problem facing Jieka Shares.

Shen Meng, director of Chanson Capital, believes that corporate IPOs to expand production capacity have become a fixed routine and have nothing to do with actual market digestion and business expansion capabilities. This is not only the inertial thinking of A-shares on the purpose of fundraising in the past, but also corporate blindness. Optimism is a possible reason for the formation of production capacity bubbles.

Financing 1.5 billion in 8 years

Although Jieka Shares is still actively seeking new financing channels, in fact, the company has received the favor of capital only one year after its establishment, and it is not short of money from a financing perspective.

In October 2015, Hejun Capital entered the market with 15 million yuan; in March 2018, Fangguang Capital invested 60 million yuan in the A-round financing process. Fangguang Capital was composed of the former rotating CEO of Huawei and the former Co-founded by Fidelity Asia partners in China, it focuses on finding and cultivating world-class companies in the upstream and downstream of the IT industry chain, and mainly invests in technology companies that are experiencing explosive growth.

After Fangguang Capital, many star institutions began to invest in Jieka Shares. For example, in April 2019, Jieka Shares received 100 million yuan in Series B financing, led by SAIF Investment Fund, followed by Huaxing Capital. .

SAIF Investment Fund, formerly known as SoftBank Asia Infrastructure Investment Fund/SoftBank SAIF, is a leading private equity company that provides financial support to high-growth companies in the Asia-Pacific region. Its investment cases include 58.com , Peking University Qianfang, Huiyuan, etc.

With the entry of SoftBank, Jieka Shares has received no less than 1.3 billion yuan in financing between 2021 and 2022. Investment institutions include CPE Yuanfeng, SDIC Investment, Temasek Temasek, and SoftBank Vision Fund , Prosperity7 Ventures, Danming Capital and many other well-known investment institutions.

Source: IT Orange

Upon completion of the last round of financing before the IPO, Jieka shares were valued at RMB 3.5 billion.

From packaging sales to robot boss

The establishment of Jieka Co., Ltd. just caught up with the trend of accelerating the process of autonomy in the domestic industrial robot market.

The founder Li Mingyang was born in 1981 and has a bachelor's degree. After graduating from university, he first worked as an engineer at Shanghai Ziquan Beverage Industry Co., Ltd., and then moved to Tetra Pak as a sales manager. I have never worked in robotics-related fields in my past experience.

When Li Mingyang was working in sales at a packaging company, he discovered that each production line needed to be equipped with many workers working in second or third shifts to do mechanical work. Day after day, there were fewer and fewer young people on the production line.

He was keenly aware of the market demand, so in July 2014, Li Mingyang and a group of engineers founded Jieka Shares. Starting from a pain point on the user side, they studied how to make robots collaborate with people.

Li Mingyang believes that the integration, interconnection and interaction of robots, people and the environment is definitely a general direction. Currently, collaborative robots are developing in this direction, but they are still in the early stages and will still be Continue to make progress in this area. There may be more robots than people in the future, and robots will be everywhere in the future.

Riding on the booming development of China's robot industry, Jieka Co., Ltd. has quickly grown into a leading brand in the field of collaborative robots. 2,267 units were sold in 2021, with a global market share of approximately 6%.

However, since the development of collaborative robots is still in its early stages, the formulation of many rules and standards is immature. During the reporting period, Jieka Co., Ltd. had a contract dispute with Inner Mongolia Grassland Red Sun Food Co., Ltd. The main reason was that after Jieka Co., Ltd. completed product delivery, the front-end equipment purchased by Red Sun could not match the Jieka Co., Ltd. automated production line. As a result, some production lines were unable to operate normally during the installation and commissioning phase. Therefore, Red Sun sued the court to request returns, refunds, etc. The second instance of the case is still pending.

In addition, Jieka Co., Ltd. also has similar contract disputes with Xinjiang Western Tianshan Dairy Co., Ltd.

Li Mingyang once lamented to the media, "When we follow the transformation and development of Made in China, we will step into a gold industry for the next few decades or longer."

Now that Jieka Shares has reached the critical period of IPO, can Li Mingyang lead the company to successfully enter the capital market? If you are optimistic about the future development of collaborative robots, let’s chat in the comment area.

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