Core Viewpoint - The company, Hangzhou Fu'en Co., Ltd., is responding to the Shenzhen Stock Exchange's inquiries regarding its IPO, focusing on its recycled fabric technology, production capacity expansion, and compliance issues [1][3]. Company Overview - Hangzhou Fu'en Co., Ltd. is a global supplier of eco-friendly fabrics, emphasizing sustainable development in its operations [6]. - The company aims to raise approximately 1.25 billion yuan through its IPO, which was accepted on June 24, 2025 [6]. Market Position - The company claims a market share of 4% in recycled polyester-cotton blended fabrics and 6% in recycled color-spun fabrics, positioning itself as a leading player in the domestic recycled fabric sector [3]. - Fu'en's export scale ranks among the top in its category, recognized by the China National Textile and Apparel Council [3]. Technology and Innovation - The company has developed customized equipment and specialized processes to address challenges in recycled fabric production, claiming a high level of non-replicability of its core technologies [3][4]. - Fu'en asserts that the industry has not faced disruptive technological changes in the midstream fabric sector, with upcoming products expected to enhance performance and cost-effectiveness [4]. Compliance and Regulatory Issues - The company reported three administrative penalties, including fines totaling approximately 17.42 thousand yuan, which it claims do not constitute significant violations [4]. - Fu'en emphasizes that the penalties are minor and have been addressed appropriately [4]. Production Capacity and Financial Projections - The company plans to produce 73.97 million meters of fabric in 2024, with a capacity utilization rate of 92.6% and a sales rate of 98.7% [5]. - Fu'en's external procurement of color-spun yarn and fabric exceeds the planned production capacity from its fundraising projects, indicating a strong demand [5]. - The company anticipates an annual depreciation expense of approximately 86.71 million yuan from the new projects, which could negatively impact profitability if performance does not meet expectations [5].

Core Viewpoint - The company, Fuen Co., Ltd., has been accepted for IPO on the Shenzhen Main Board, positioning itself as a leading global supplier of sustainable ecological fabrics, focusing on innovation and differentiation in the textile industry [1] Financial Performance - Fuen Co., Ltd. achieved revenues of 1.764 billion yuan, 1.517 billion yuan, and 1.813 billion yuan for the years 2022, 2023, and 2024 respectively, with net profits of 277 million yuan, 229 million yuan, and 275 million yuan during the same period [1] Fundraising and Projects - The company plans to raise 1.25 billion yuan through its IPO, with key projects including the integrated project for recycled environmental wool-type colored spinning fabric (800 million yuan) and a high-end recycled materials research institute (450 million yuan) [2] - The integrated project aims to produce 75 million meters of colored fabric, 5 million meters of plain fabric, and 7,200 tons of colored spinning yarn annually, utilizing modern production technologies to enhance automation and product quality [2] Research and Development - The high-end recycled materials research institute will have a construction period of three years, aiming to produce 3,000 tons of high-end recycled knitted fabric annually, enhancing the company's capabilities in the entire textile supply chain [3] - The company has established a comprehensive service capability from trend analysis to garment design, meeting the high customization demands of international brands like Uniqlo, H&M, and ZARA [3] Market Position and Growth - Fuen Co., Ltd. holds a significant market share in the recycled polyester-cotton blended fabric and recycled colored fabric sectors, with sales of approximately 50 million meters and 32 million meters respectively in 2023, and projected increases in 2024 [4] - The company has expanded its overseas market presence, achieving 932 million yuan in overseas revenue in 2024, accounting for 51.71% of total revenue, and has established subsidiaries in Singapore and Hong Kong to optimize overseas services [4] Industry Trends - The textile industry is undergoing a green transformation towards low-carbon, circular, and clean production, with Fuen Co., Ltd. aiming to strengthen its position in the supply chains of major international brands and increase its market share in the domestic market [5]

Core Viewpoint - The IPO application of Hangzhou Fu'en Co., Ltd. has been accepted by the Shenzhen Stock Exchange, with CITIC Securities as the sole sponsor, marking a significant event in the textile industry after a two-year hiatus in A-share IPO projects [1][3]. Group 1: Company Overview - Fu'en Co., Ltd. specializes in eco-friendly fabrics, primarily focusing on recycled materials, and has established itself as a leading player in the domestic market for recycled fabrics, collaborating with major brands like H&M, Uniqlo, and Zara [1][5]. - The company has a comprehensive business model that includes fabric design, research and development, spinning, weaving, dyeing, finishing, and sales [5]. Group 2: Financial Performance - Fu'en's revenue for the years 2022, 2023, and 2024 was reported at 1.764 billion, 1.517 billion, and 1.813 billion yuan respectively, indicating a 14% decline in 2023 followed by a 19.51% recovery in 2024 [5][6]. - The company's net profit for the same years was 277 million, 229 million, and 275 million yuan, showing a similar trend of decline and recovery [9]. Group 3: Market Position and Risks - Fu'en holds a significant market share in the recycled polyester-cotton blended fabric sector, but its revenue is heavily reliant on a few major clients, with approximately 70% of total revenue coming from the top five brands, indicating a concentration risk [11][21]. - The company has faced challenges due to the reduction of physical stores by major fast fashion brands, which may impact future sales [11]. Group 4: Dividend Policy and Ownership Structure - Fu'en's dividend policy has raised concerns, as it distributed 381 million yuan in dividends in 2022, exceeding its net profit for that year, leading to questions about the necessity of its IPO fundraising [12][19]. - The ownership structure is heavily concentrated, with the Wang family controlling approximately 83.89% of the voting rights, raising potential governance issues [19][21]. Group 5: Future Prospects - The company plans to raise 1.25 billion yuan through the IPO, with significant investments earmarked for projects related to recycled fabric production and high-end eco-friendly material research [20][21]. - Fu'en aims to enhance its position in the sustainable fabric market, aligning with global trends towards low-carbon and eco-friendly development [21].