As the only external institutional investor, Sequoia has accompanied Dongpeng Ceramic for 10 years.
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On October 19, Guangdong Dongpeng Ceramic Holdings Co., Ltd. landed on the SME Board of the Shenzhen Stock Exchange with an issue price of CNY 11.35 per share. The company's stock price saw a top increase of 44% in first-day trading, with a market value of over CNY 19.1 billion. Dongpeng is a world-class brand and manufacturer of ceramic tiles and bathroom decor. It provides low-carbon, environmentally friendly, high-tech, customized products to consumers.
As of June 30, 2020, the company has 1,753 ceramic tile dealers, 4,981 ceramic tile dealer stores, 82 sanitary ware dealers, and 1,468 sanitary ware dealer stores. The company has also established 112 direct-operated ceramic tile stores/showrooms and 2 direct-operated sanitary ware stores/showrooms in China. Dongpeng has also registered international trademarks in nearly 30 countries and regions, including the United States, the United Kingdom, Germany, and Italy, and sells its products overseas.
In 2019, the company realized an operating income of CNY 6.75 billion, a year-on-year increase of 2.00%. In terms of profitability, Dongpeng has maintained its gross profit margin at a relatively high level due to its high-end product structure. In 2017, 2018, 2019 and 1H 2020, its comprehensive gross profit margin was 37.26%, 34.69%, 35.73% and 32.27%, respectively, which has advantages over comparable listed companies in the same industry.
The ceramic tile industry has market demand for CNY 300-500 billion per year. There is a large market but a deficient level of concentration. Among them, the market share of leading companies is less than 3%. The low industry concentration pattern and a high degree of decentralization are not conducive to the industry's sustainable development. The structural adjustment of the building and sanitary ceramic industry has become a trend.