【New Stock IPO】Guomin Technology 2701 IPO Raising Up to 1 Billion, Oversubscription of 26 Billion with 24x Coverage, Entry Fee of 2182 Yuan - How Much Higher Premium Does A-Share Have Compared to H-Share?

Guomin Technology (New Listing Code: 02701) Subscribed from March 13 to 18. The platform-based integrated circuit (IC) design company plans to issue 95 million H-shares, with 10% available for public offering in Hong Kong. The maximum offering price is HKD 10.80, raising up to HKD 1.03 billion. As of the afternoon of March 17, Guomin Technology received HKD 2.6 billion in margin subscriptions, with a public offering fundraising amount of HKD 103 million, representing an oversubscription of 24.2 times.

Guomin Technology’s minimum lot is 200 shares, with an entry fee of HKD 2,181.80 per lot. The company is expected to list on March 23. CITIC Securities is the sole sponsor.

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Guomin Technology A-shares (Shenzhen: 300077) before the IPO closed at RMB 21.96 (approximately HKD 25.02) on Thursday. Based on this, the H-shares (maximum offering price HKD 10.80) are at a 56.8% discount compared to A-shares, which is a 131.7% premium over the A-share level.

Business and Performance

Guomin Technology focuses on terminal control chips and system solutions, and also operates lithium battery anode materials business. Its products include general-purpose MCUs, specialized market chips, RF chips, and BMS chips, used in consumer electronics, industrial control, digital energy, smart home, automotive electronics, and medical electronics. The lithium battery anode materials business provides artificial graphite products and graphitization services.

According to Zhuoshi Consulting data, based on 2024 revenue, Guomin Technology ranks among the top five Chinese companies in the global platform MCU market, and among the top three in the 32-bit platform MCU market. It is also the leading provider of embedded commercial cryptography algorithm modules in the Chinese MCU market.

In the first nine months of last year, revenue was RMB 960 million, up 16.7% year-on-year. Chip product sales reached 280 million units, an increase of 13.8%. Revenue contribution from chip business was 48.4%. During this period, the company’s attributable loss was RMB 75.746 million, a reduction of 54.4%.

Introduction of 5 Strategic Investors with a Total Investment of RMB 140 Million

Guomin Technology has introduced strategic investors including Guohua Life, Jiasi International Investment, CEO Dai Wanquan of Hongde Electronics, An Jiangbo, and Xingwangda Electronics (Shenzhen: 300207) subsidiary Xingwangda Financial, with a total investment of RMB 140 million.

Use of Net Proceeds

• 50.8%: Enhance R&D capabilities, develop new product lines, and improve product performance, including high-performance MCUs, multi-protocol communication chips, specialized market chips, and automotive-grade chips
• 9.2%: Upgrade existing product portfolio
• 15%: Conduct strategic investments and acquisitions
• 15%: Repay some outstanding bank loans
• 10%: Operating capital and general corporate purposes

Source: Guomin Technology Announcement