Laser Company Hymson Files for IPO on Shanghai's Nasdaq-style Star Market
It banked over CNY 800 million (USD 114.88 million) in operating income in 2018 – more than two and half times that of 2016.
Hymson Laser Intelligent Equipment (海目星, A19472:SH) reportedly filed a prospectus with the Chinese market regulator on the last day of the decade.
On December 31, the firm joined the list (in Chinese) of more than two hundred high-tech-driven capital seekers that, so far, have applied for an initial public offering on the Star Market, which is a new experimental trading platform under the aegis of the Shanghai bourse.
Founded in 2008, Hymson has been active within three areas: standard automation equipment (over half of the company's revenue came from this segment in 2018), lithium-ion batteries and laser equipment for displays and brittle materials.
This product mix, combined with the growing market demand, whipped up the Shenzhen-based manufacturer's gains: the total revenue was CNY 298 million (USD 42.8 million) in 2016, while two years later, the number hit CNY 800.7 million (USD 115 million) – a 63.92% Compound Average Growth Rate (CAGR).
Over the same period, its net profit grew tenfold from CNY 8.23 million (USD 1.18 million) to CNY 83.3 million (USD 11.96 million), clearly indicating an economy of scale at work.
In such a knowledge-intensive sphere, commercial success has a lot to do with investment in research and development activities. This fact is apparently well understood by Hymson: the company, like a confident poker player, is 'pot committed' to R&D. A bit more than CNY 28.75 million (USD 4.13 million) was piled into the innovation rush in 2016. As of 2018, for the first time over the reporting period, it invested in excess of 10% of its operating income – CNY 82.5 million (USD 11.85 million) – with researchers' salaries accounting for over 57% of this amount.
And the technological development process is on the upswing in Hymson. Almost 13% of the revenue collected in the first part of 2019 was allocated for this purpose. Worth mentioning is that this is the highest rate among competing companies in that sector in China. For one thing, United Winners (联赢激光, A19311:SH), another applicant for the sci-tech board listing, spent less than 6% of its operating income in the first half of 2019. For the Shenzhen Stock Exchange-listed Lead Intelligent Equipment (先导智能, 300450:SZ), this metric reached 11.37%.
Researcher MarketsandMarkets expects the global laser marking market alone to grow at a 6% CAGR in the next five years, reaching USD 3 billion by 2024.