Chinese High-tech Manufacturer Juheshun Raises $79m In Shanghai IPO

Hangzhou Juheshun New Material Co Ltd, a Chinese firm that manufactures synthetic fibres, has raised 556 million yuan ($79 million) in an initial public offering (IPO) on the Main Board of the Shanghai Stock Exchange (SSE) on Thursday.

Juheshun, which had filed an IPO application as early as April 2019, offered nearly 78.89 million shares at 7.05 yuan ($1) apiece.

Juheshun was founded in 2013 to primarily engage in the research and development, production, and sale of polyamide-6 slices – one of the most widely-used engineering thermoplastics known for its high strength, good fatigue resistance, good water absorption and chemical stability.

The company registered almost 2.43 billion yuan ($343 million) in revenue in 2019, up 20.30 per cent compared to a year ago. Its net profit increased by 4.20 per cent to reach 100 million yuan ($14 million) last year, shows the prospectus.

Compared to the same period in 2019, the company estimated an up to 11.64 per cent decline in revenue in the first half of 2020 to somewhere between 1 billion yuan ($141 million) and 1.13 billion yuan ($160 million).

The firm said that its revenue could bounce back in the second half of the year as China recovers from the impact of the pandemic.

The company chairman Fu Changbao is the largest shareholder with a combined 37.87 per cent stake through direct and indirect holdings after the IPO.

GF Qianhe, which invested in Juheshun’s pre-Series A round in 2018, saw its shareholding in the company diluted from 3.51 per cent to 2.63 per cent in the offering. GF Qianhe is an alternative investment subsidiary of Hong Kong-listed GF Securities.

Shares of Juheshun are listed under the symbol “605166.” GF Securities served as the bookrunner of the deal.