Original title: The IPO of Lianxiang, the leader of art wall coverings, is about to increase consumption and superimpose brand advantages to expand growth space
Written by: Teng Xiao
Editor: Koko Financial News Editorial Department
More leading companies in the home decoration field are entering the ranks of listed companies.
A few days ago, after the successful completion of the roadshow and inquiry procedures, Zhejiang Lianxiang Smart Home Co., Ltd. (hereinafter referred to as Lianxiang shares), a leading wall covering enterprise, officially started its IPO subscription process, which also means that Lianxiang shares have successfully achieved The goal of landing on the main board of the Shanghai Stock Exchange and listing for trading has reached the countdown.
Lianxiang Co., Ltd. is currently mainly engaged in the research and development, design, production and sales of wall coverings, as well as the research and development, production and sales of some curtains and other indoor home decoration products, as well as the overall indoor home improvement engineering business.
It is understood that Lianxiang, as a leading enterprise in the domestic wall covering industry and one of the first enterprises engaged in the R&D and production of embroidery wall coverings, has now innovatively designed a variety of embroidered wall covering products, and has created industry-leading products in the market. Influential wall covering brands such as “LEADSHOW” and “LEADSHOW”.
According to industry insiders, with the gradual increase in demand for new technologies and aesthetics in the domestic home decoration market, the penetration rate of new home decoration products represented by wall coverings will also increase. Multiple factors are expected to jointly enhance the performance growth space of Lianxiang shares.
1) The “invisible faucet” of the wall covering
As a leading enterprise in the vertical field, Lianxiang Co., Ltd. has fully integrated Chinese traditional embroidery craft painting technology with wall home decoration and designed embroidered wall coverings with independent intellectual property rights in 2011. It has been deeply cultivated in the field of art wall coverings for many years, and accumulated A large number of R & D design advantages.
According to the prospectus, Lianxiang currently has a wide distribution range of products and a variety of product designs. As of December 31, 2021, a total of 292 patents, 161 trademarks and 308 copyrights have been obtained.
In fact, the list of many demonstration enterprises currently selected by Lianxiang also proves its “hidden champion” status in the vertical track.
It is understood that Lianxiang currently serves as the executive chairman unit of the Wallpaper and Wall Covering Professional Committee of the China Interior Decoration Association, the vice-chairman unit of the China Building Decoration Materials Association, and the rotating chairman unit of the Wallpaper and Wall Covering Branch of the China Building Decoration Materials Association and other industry associations. job title.
Not only that, Lianxiang Co., Ltd. has also been selected as the second batch of specialized and special new “little giant” enterprises by the Ministry of Industry and Information Technology, a national intellectual property advantage enterprise, Zhejiang provincial industrial design center, Zhejiang invisible champion cultivation enterprise, Zhejiang manufacturing and Internet The list of integrated development demonstration enterprises, Zhejiang Province Industrial Internet Platform Creation List, Zhejiang Province Management Innovation Pilot Enterprises, Zhejiang Province Trademark Brand Demonstration Enterprises, etc.
During the reporting period, its profit and loss indicators have gradually improved, showing that the strong competitiveness of Lianxiang shares has helped the fundamentals.
During the reporting period from 2020 to 2021, Lianxiang Co., Ltd. achieved operating income of 254 million yuan and 279 million yuan respectively, and net profit attributable to the parent was 64 million yuan and 67 million yuan respectively, showing a gradual growth trend.
In fact, the blue-chip trend of Lianxiang shares is expected to continue in 2022.
According to the forecast of Lianxiang Shares, its operating income in the first quarter of 2022 is expected to reach 52 million yuan to 54 million yuan, and it is expected that the net profit attributable to shareholders of the parent company will be 8.7921 million yuan to 9.2079 million yuan in the quarter, which is similar to the first quarter of 2021. The net profit attributable to shareholders of the parent company was 8.2409 million yuan, an increase of 6.69% to 11.79%.
2) Penetration rate, brand advantage or will exert force
From the perspective of industry insiders, along with the continuous improvement of the consumption upgrading ability of the home improvement market, the increase in the penetration rate of new products such as wall coverings is expected to give more development opportunities to wall covering enterprises including Lianxiang shares.
“From the earliest latex paint to later wallpapers, to today’s wall coverings, there is still a lot of room for improvement in the penetration rate of these new materials, because people’s pursuit of a better life is still improving.” A building materials industry analyst said, “This actually gives wall covering companies a great opportunity for development, because the market capacity of the entire category is still expanding.”
At the same time, wall coverings have strong consumer attributes, and the first-mover brand advantage will often form a relatively stable moat, which will also bring relatively stable brand expansion expectations for Lianxiang.
“Consumer products are characterized by relatively strong brand attributes, so the first-mover advantage is very obvious. When the penetration rate of wall coverings is not high, a relatively recognized brand has been formed, so it will actually be better to hit the market in the future.” The above analysts express.
On the one hand, Lianxiang Co., Ltd. has rapidly expanded its market share through distribution and other modes of quickly reaching the market.
“During the reporting period, the company’s distribution sales revenue accounted for more than 97% of the main business revenue. The company has established a relatively complete dealer management system and dealer sales network. The dealer stores have covered most of the provinces, municipalities and autonomous regions in the country. Distributors quickly establish a sales network and expand market share, and at the same time, they are also closer to consumers through distributor stores and improve brand awareness.” said Lianxiang Co., Ltd.
On the other hand, the refurbishment demand of the massive stock housing market is also expected to further enhance the performance imagination of Lianxiang shares.
“Because wall covering products were not used on the walls of early houses, the mature demand for renovation and renovation of the stock house market will promote the expansion of market share of wall covering products and promote the overall development of the industry.” Lianxiang shares said.
“The company has consolidated its leading market position in the industry by relying on its own R&D and design capabilities, cost and quality control capabilities, and gradually improved marketing network system, and the company’s profitability is outstanding.” Lianxiang shares further stated, “In the future, if the company can give full play to its own With its advantages in product R&D and design, quality control, marketing network construction and management, and seizing the opportunities brought by the growth of industry market demand, it is expected to further increase market share, consolidate market position, and improve profitability and core competitiveness.”
“The combination of the two elements is expected to further improve the valuation consensus of Lianxiang shares and bring positive factors to its IPO and post-listing prices,” said the above-mentioned analysts.
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