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Markets· Equity· IPO

Zhejiang Sunrise Garment Group’s IPO to debut on Shanghai Stock Exchange

CKN
minutes 2021/10/26 10:12:26
4,032

Oct 26, 2021 (China Knowledge) - Zhejiang Sunrise Garment Group (605138) to start trading on the Shanghai Stock Exchange's Main Board Oct 27, tomorrow. The firm has issued 55.56 mln shares priced at RMB 9.97 per share raising RMB 553.93 mln. Its price-to-earnings ratio (PE) stands at 22.98. During subscription the IPO was 2,954 times oversubscribed.

CITIC Securities acts as the lead underwriter and sponsor for the IPO.

Zhejiang Sunrise Garment's business is related to weaving, printing and dyeing.

In FY 2020, Zhejiang Sunrise Garment Group garnered a total revenue of RMB 4.7 bln, down 16% YoY. In terms of net income, it achieved RMB 297 mln, rising 8% YoY. In H1 2021, the company reported revenue of RMB 2.28 bln, a YoY decrease of 1%, and its net profits reached RMB 179 mln, up 39% YoY.

The company is in the textile and apparel industry that is currently made of 111 counters in Shanghai and the Shezhen Stock Exchange with a total combined market capitalization of RMB 689 bln, industry’s average PE of 21 times. The textile and apparel industry’s index is up 13.00% year-to-date, ranking it the 15th place among all 29 broad industry groupings.

Lao Feng Xiang Co.,Ltd. (600612) takes up the top spot in terms of sales in the industry, reporting RMB 51.72 bln of sales in 2020, with a net profit of RMB 1.59 bln, at 13 times PE. The second largest is China National Gold Group Gold Jewellery Co.,Ltd (600916), a total revenue of RMB 33.79 bln and a net profit of RMB 500 mln, at 32 times PE. Hla Group Corp., Ltd. (600398) ranked third. It garnered a total revenue of RMB 17.96 bln last year, and a net profit of RMB 1.78 bln, with 12 times PE.

The average industry’s PE for the same or similar stocks on Hong Kong Exchange (HKEx) and the U.S. stock markets for textile and apparel is 24 times and 25 times, respectively. On a year-to-date basis, the industry’s index on the HKEx rises 46.19% and the U.S is up 19.23%.

There will be another 4 IPO debut tomorrow, Jiusheng Electric Co., Ltd. (301082), Xinxiang Tuoxin Pharmaceutical Co., Ltd. (301089), Shareate Tools Ltd. (688257) and Jing-Jin Electric Technologies Co., Ltd. (688280).

Since January, a total of 391 companies have listed on either Shanghai or Shenzhen Stock Exchange, most are mainly in the machinery equipment, electronics and pharmaceutical and biological industries.

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