On July 29, the IPO application of NBXY Light Alloy Technology Group was accepted. According to the prospectus, NBXY has performed steadily in the past three years, and its main business gross profit margin has exceeded 50% for three consecutive years. At the same time, the company's investment in research and development is also increasing year by year, and the research and development rate is higher than comparable companies in the same industry.
The gross profit margin of the main business has exceeded 50% for three consecutive years
NBXY intends to publicly issue 20 million shares in this IPO, raising 332 million yuan. According to the prospectus, the raised funds will be used for high-strength magnesium alloy precision die-casting production projects and high-strength magnesium alloy precision die-casting technology research and development center.
NBXY is mainly engaged in the research and development, production and sales of magnesium alloy, aluminum alloy precision die-casting products and supporting die-casting molds. From 2017 to 2019, the company's operating income was 118 million yuan, 106 million yuan, and 147 million yuan, and its main business gross profit margin remained above 50% for three consecutive years, at 57.92%, 50.14%, and 53.45%, respectively.
NBXY's annual growth performance cannot be separated from Sea Link International IRB, Inc.'s largest customer during the reporting period. It is understood that Sea Link is a supplier of auto lamp parts and components in North America, providing auto lamp-related products for many world-renowned automotive first-tier suppliers. During the reporting period, the company’s sales to Sea Link accounted for 65.68%, 50.83%, and 51.14% of revenue, respectively. The main product sold was automotive lamp heat sink brackets.
R&D rate is higher than comparable companies in the same industry
From 2017 to 2019, the amount of NBXY's research and development expenses has shown an increasing trend year by year, which are respectively 5.10 million yuan, 5.71 million yuan and 6.743 million yuan, and the research and development expense ratios are 4.32%, 5.54% and 4.59%.
Compared with comparable companies in the same industry, NJAD Precision Alloy Technology Group, and China's leading hot-formed die-casting and forging precision aluminum alloy auto parts manufacturers NBXS, ZJWF, DGYA and NJYH, NBXY's R&D expense ratio is higher than average. According to the prospectus, the average R&D expense ratios of the above-mentioned comparable companies in the past three years are 3.61%, 4.03% and 4.34%.