As an important "blood transfusion channel" of the wave information, now seems to be difficult to hide the decline. So, Wave Group, on the one hand, trying to transform, close to the "new infrastructure", on the other hand, adjust the shareholding structure, hoping to create a more imaginative listing platform, Wave Cloud on the Science and Technology Board.
December 9 news, CITIC Securities has completed the Wave cloud of science and innovation board listing counseling work, the day of the plate Wave system have been strong, Wave software stop, Wave information once rose more than 4%. However, after a brief "return to the light", the two stocks fell for two consecutive days, compared to the high point of the 9th plate, wave information has fallen to 7.6%, wave software has fallen to 6.47%.
In the first half of this year, Wave Group has also had the scenery, then as a domestic veteran IT giants, known as the "new infrastructure must buy the standard" by the market, its two listed platforms - Wave information and Wave software this year, the stock price has been Double, however, the quality of the company's assets does not seem to be recognized by the market, short-term speculation after the stock price continues to slump.
From the wave of information recently disclosed three quarterly report can also be seen, its existence of the main industry profitability is weak by subsidies, low investment in research and development or technology out of step, high inventory risk of high fall, and many other problems, the future outlook is worrisome. Wave information is an important financing platform for the parent company Wave Group, if the wave cloud this time can successfully land on the Science and Technology Innovation Board, will add another important financing platform, to ease the financial pressure under the difficult transformation of the Wave Group in recent years. However, more important than publicizing the concept of new infrastructure, expanding the scale of business coverage, perhaps more important to enhance the level of investment in research and development and profitability, so as to truly get rid of the vicious cycle of constantly seeking outside "blood transfusion".
The "little son" of high hopes - Wave Cloud
December 9, according to the official website of CITIC Securities, as of November 16, 2020, CITIC Securities has been Completion of Wave Cloud's Cochrane Board listing counseling work, and reported to the Shandong Securities Regulatory Bureau, "CITIC Securities Co., Ltd. on the initial public offering of Wave Cloud Information Technology Company Limited and listing counseling summary report.
The official website said, Wave Cloud was established as an industrial Internet platform developer, based on a hybrid cloud management model, providing security protection mechanisms and service capabilities for government agencies and enterprise organizations, providing a full range of services covering IaaS, PaaS, DaaS, government applications, enterprise applications.
In 2015, the "Wave Cloud" brand was officially independent, and the parent group committed to investing 10 billion yuan in three years, and in 2017, the target amount was increased to 60 billion in 2018, 12 billion in 2019, and 24 billion in 2020, so the degree of attention is evident.
Wave Cloud, which inherited the parent group's information service experience and government relationship resources, has been particularly smooth in business expansion, and has been the first in the government market share and the top three in the public cloud market for many years.
The official website shows that the company's seven core cloud data centers and 62 local cloud data centers across the country provide cloud computing services for 150+ local municipalities in 25 provinces and 1 million+ enterprises, hosting 10,000+ government departments and more than 40,000 applications, and providing convenient services for 2.45 million civil servants across the country for the benefit of 470 million people. It has obtained the status of cloud service provider for enterprises in 260+ municipalities and the status of industrial Internet service provider for 100+ municipalities, and has promoted the digital transformation of millions of enterprises. From the perspective of business data alone, the depth and breadth are beyond the reach of peers.
Before going public, Wave Cloud completed no less than three financing rounds in the primary market***. According to publicly disclosed information, the B round occurred in July 2019, and the amount of financing amounted to 600 million yuan; the C round occurred in March 2020, and the C+ round of financing allegedly occurred in August, and the amount of financing amounted to 150 million yuan, the current valuation has exceeded 10 billion yuan.
From the list of funders, the previous round mainly introduced investment funds with government background, including the State Council, the Ministry of Finance, the Shanghai Municipal State-owned Assets Supervision and Administration Commission (SASAC), the Construction Bank, Minsheng Banking Corporation (Minsheng Bank) background of the investment institutions, etc., the second round of the internal executives of the company's main shareholding, However, the external strategic investors, in particular, the well-known institutional investors are not many.
It is worth mentioning that, as a new infrastructure rookie who will soon be applying for the TechCrunch board, WaveCloud does not forget to synchronize with the policy to "draw the key", always emphasizing its own identity as a rooted and reddish new infrastructure.
On April 20, the National Development and Reform Commission clarified the scope of the new infrastructure, pointing out that the arithmetic infrastructure will be represented by data centers and intelligent computing centers. And on April 9, in 2020 Wave Cloud Data Center Partners Conference, Wave Cloud proposed to promote the integration of artificial intelligence, cloud computing and big data development, the full development of the wisdom of the age of "intelligent computing center, time and even slightly ahead of the release of the policy, "betting" steady and accurate.
And the state-owned background of the wave did participate in the new infrastructure "out of the question". November 17, the National Information Center joint wave released the "intelligent computing center planning and construction guidelines", once again clear definition of the intelligent computing center: the intelligent computing center through the production of arithmetic power, aggregation, scheduling and release, and efficiently support data, open *** enjoyment, intelligent ecosystems. open*** enjoyment, intelligent ecological construction, and industrial innovation aggregation, and strongly promote AI industrialization, industrial AI and intelligent government governance. The description is also highly consistent with the official introduction of Wave Cloud.
The "oldest son" - Wave Information
As the oldest brother of "Wave System", Wave Information has had its share of successes. The first half of this year, as a result of the "Wave system", the Wave information has also been a good time. In the first half of this year, due to the x86 servers provided by Wave Information is the new infrastructure field "necessary raw materials", Wave Department was once regarded as "new infrastructure must buy the standard", the stock price doubled.
But there is no solid performance support, the rise in stock prices can only be "flash in the pan". From the latest financial results, wave information can not hide the performance trend, and contains many risks.
The company said in the three-quarterly report, benefited from the epidemic period of teleconferencing, distance education and other industries on the cloud center of the urgent needs of the first nine months of this year, the company achieved revenue of 45.5 billion yuan, an increase of 19%. However, compared with the scale of revenue growth, the profit is much less, the first three quarters of the company's net profit of only 628 million yuan, the net profit margin is the same as the same period of the previous year, only 1.3%.
As the company's main business is the server, essentially an assembly company, In recent years the market competition is fierce, the server market gross profit margins year after year, so the company's revenue scale year after year, but the more the money is less and less. The financial report shows that the gross profit margin of Wave Information has fallen from about 20% a decade ago to about 11% now.
Weak profitability, naturally, there is no incentive to invest in research and development. The financial report shows that the company's current R & D investment accounted for only 4% of revenue, significantly lower than the rest of the head of the technology company, for the rapid iteration of technology industry, the lack of R & D revenue will certainly limit the future development of power, Wave information seems to be entering a vicious circle, slowly falling behind.
On the other hand, the company's inventory balance is high, or there is a high risk of price drops. Perhaps because of the management's optimistic judgment of the market in the second half of the year, the first half of the company more wild stockpiling. The report shows that the company's inventory balance of up to 15 billion yuan, the highest ever. However, shipments do not seem to meet expectations, the third quarter revenue even fell 8.8%, at this time the company's inventory balance is still as high as 13.685 billion yuan.
As electronic products are updated faster, the risk of price drops is also greater, these did not sell out the goods in time, but became a liability. In the half-yearly report, the company's cumulative balance of provision for inventory decline up to 913 million yuan, of which 602 million yuan in the first half of the new, close to five times the same period of the previous year, and even more than the net profit for the same period.
Previously, the wave of information due to three years of two placements, frequent fund-raising "blood" is also controversial.
In July 2017, the company to all shareholders *** counting the placement of 290 million shares, amounting to 2.998 billion yuan, to raise funds of 1.675 billion yuan to supplement liquidity, 971 million yuan for the repayment of bank loans. That is, to all shareholders to raise nearly 3 billion, nearly 90% are used to "pay off the debt to make up for the blood".
July 17, 2019, the company once again issued a share placement proposal, the company intends to all shareholders to place a number of shares of not more than 322 million shares, to raise funds will not exceed 2 billion yuan. The second time the company more "justified", the announcement that the funds raised after deducting the issuance costs will be used to repay bank loans and supplement liquidity.
Wave is not willing to "cut food"
Wave is one of the earliest IT brands in China, with three listed companies, Wave Information, Wave Software and Wave International, and its business covers cloud data center, cloud services and big data,
Since 2010, Wave Group has begun to plan the strategic transformation from a traditional IT products and solutions provider to a cloud computing service provider, smart computing center service provider, the goal is to become a leading "cloud + digital + artificial intelligence" of the new Internet enterprises. However, the former IT giant wants to "from hardware to software" efforts, seems to be particularly difficult.
From its list of honors and awards, the company's development in recent years can also be seen side by side. 2008, Wave Group was ranked No. 3 in China's top 500 large enterprise groups in terms of competitiveness, and No. 10 of China's top 100 enterprises in electronic information; in 2019, its ranking in the "Top 500 Chinese enterprises" has fallen to No. 189. has fallen to 189th.
Public information shows that Wave Group is 38.88% owned by Shandong Province State-owned Assets Investment Holding Company Limited (referred to as Shandong State-owned Investment), the actual controller is Shandong Province State-owned Assets Supervision and Administration Commission (SASAC), Shandong State-owned Investment Bonds prospectus shows that the Wave Group realized operating income of 32.554 billion yuan in 2017, with a net profit of 569 million yuan in the first half of 2018, and realized operating income of 21.937 billion yuan, with a net profit of 159 million yuan in the first half of 2018. billion yuan, net profit of 159 million yuan.
By business, the main business of Wave Group can be divided into three blocks: hardware products mainly server, software products mainly management software, and innovative business mainly cloud services. The traditional hardware and software business is mainly carried out through the listed companies Wave Information, Wave Software and Wave International, while the imaginative and innovative business of cloud services is all placed in the Wave Cloud, which is about to hit the Science and Technology Innovation Board.
In order to successfully send the son on the KTC, Wave Group has also carried out a series of equity structure adjustment. On March 6 last year, Wave Software has issued a notice saying that, after verification, the company does not hold equity in Wave Cloud, and it is engaged in the business, segmentation of the industry are not the same.
In March this year, the listed company Wave Software issued a change in equity announcement, announced that "a split two", the original controlling shareholder of the listed company Wave Software Group will be separated into Wave Software Group and Wave Software Technology (new) by way of survival separation. After the change, the controlling shareholder will be changed from wave software group to wave software technology, the real controller remains unchanged. The original controlling shareholder of the listed company, Wave Software Group, is the major shareholder of Wave Cloud.
Wave cloud side, after several rounds of financing, the concentration of equity has also been significantly weakened, seems to try to avoid suspicion. Data show that 18 years to complete the first round of financing, Wave software shareholding from 100% down to 42.45%; 19 years in July began several rounds of pre-IPO capital increase further diluted the shares of Wave software, and its shareholding is now down to 38.1776%, still the largest shareholder. Ningbo Honghui, Ningbo Kangchen and Tianjin Tongchuang hold 12.72%, 11.76% and 6.83% respectively, while the rest of the organizations and individuals hold no more than 5%.
Previously, Wave Information as the group's main source of "blood transfusion", frequently to the fixed increase, share placement, bonds and other ways to raise funds in the secondary market.
Wave Information, as the main "blood" source of the group, frequently in the secondary market in the form of fixed-price, share placement, bonds and other ways to raise money.
And Wave Group gathers wool through dividends, reduction of holdings and other ways. Since 2014, Wave Information dividends up to 126 million yuan, and since then the annual dividends are not less than 100 million yuan, in 18, 19, dividends even more than 300 million yuan. However, a large proportion of dividends are mainly into the pockets of the controlling shareholders with a 41% shareholding. In recent years, Wave Group has reduced its holdings by more than 5%, and the group's current stake in Wave Information has fallen to 36%.
If the little brother Wave Cloud this time can successfully land on the Science and Technology Innovation Board, will be able to take over the big brother Wave Information, to ease the financial pressure under the difficult transformation of the Wave Group in recent years. However, rather than publicizing the concept of new infrastructure, expanding the scale of business coverage, it is perhaps more important to improve the level of R & D investment and profitability, so that we can really get rid of the vicious circle of constantly seeking external "blood transfusion".