Core Viewpoint - The skincare industry is increasingly competitive, and brands that invest in research and development (R&D) are more likely to succeed in the long term [1][3]. R&D Structure - The company has established a dual approach to R&D, combining independent and collaborative efforts, with a structure known as "one center, five bases" [2]. - "One center" refers to the joint establishment of the Zhongke Kunzhi Plant Doctor R&D Center with the Kunming Institute of Botany, which focuses on fundamental research and new product development [2]. - The "five bases" include various research facilities across China and Japan, responsible for active ingredients, product formulation, production processes, and quality assurance [2]. Patent Achievements - As of May 31, 2025, the company has obtained 212 patents, including 59 invention patents, showcasing its commitment to technological innovation [2]. R&D Investment - The company's R&D expenditures for recent periods were 73.77 million yuan, 75.88 million yuan, and 66.33 million yuan, consistently representing over 3% of its revenue [2]. - Maintaining such a high percentage of R&D investment in the skincare industry reflects the brand's dedication to research and consumer responsibility [2]. Market Position - With 31 years of experience and substantial R&D achievements, the company emphasizes that strong R&D capabilities are essential for gaining long-term consumer trust in a competitive market [3].

Core Viewpoint - Yuan Chuang Technology Co., Ltd. is attempting its third IPO since 2021, facing significant challenges due to financial data and governance issues revealed in its latest prospectus [1][3][23] Group 1: Ownership and Governance Issues - Yuan Chuang Technology has a high family ownership ratio of 95.24%, raising concerns about corporate governance effectiveness [3][5] - The actual controller, Wang Wenjie, has a history of legal issues, including a bribery case, which has led to scrutiny from regulatory bodies [6][7] - The management team is also characterized by familial ties, with several key positions held by relatives of the actual controller, indicating a lack of professional governance [8] Group 2: Customer Dependency and Financial Risks - The company faces significant customer concentration risk, with the top five customers contributing over 46% of sales revenue from 2022 to 2024 [11] - A major customer, Wo De Agricultural Machinery, accounts for 22.91% of revenue but represents 40.43% of accounts receivable, indicating a potential cash flow crisis [12] - The overdue accounts from Wo De Agricultural Machinery have been substantial, with overdue amounts reaching 96.08 million yuan at the end of 2022 [12] Group 3: Financial Performance and Cash Flow Concerns - The company's revenue showed fluctuations, with 2024 net profit declining by 12.94% year-on-year, while accounts receivable surged by 35.18% [14] - The net cash flow from operating activities decreased by 35.88% in 2024, raising concerns about the company's ability to convert revenue into cash [16] - The company has distributed 47.16 million yuan in cash dividends from 2020 to 2023, while planning to raise 60 million yuan for working capital, raising questions about the rationale behind this financial strategy [16] Group 4: R&D and Capacity Expansion Issues - The company reported a sudden increase in patents and claimed to have 14 R&D personnel, despite previously stating a lack of dedicated R&D staff [18] - R&D expenditure remains low at 0.72% of revenue in 2024, which is below industry standards, questioning the claimed technological advantages [19] - The efficiency of fixed asset output has been declining, indicating potential issues with asset utilization amid expansion plans [20] Group 5: Regulatory Scrutiny and Data Discrepancies - The introduction of a rebate policy for traders during a period of declining performance raises concerns about potential financial manipulation [21] - Discrepancies in reported sales figures between the company and its major customer, Wo De Agricultural Machinery, have led to questions about financial transparency [21] - Changes in the educational qualifications of key technical personnel shortly after IPO scrutiny have raised further doubts about the company's credibility [21]