China Securities Regulatory Commission: Approved the registration of Minxin Micro's IPO on the Science and Technology Innovation Board

On July 14, the China Securities Regulatory Commission announced that the China Securities Regulatory Commission has recently approved the registration of the initial public offering of shares on the Science and Technology Innovation Board of Suzhou Minxin Microelectronics Technology Co., Ltd. (hereinafter referred to as "Minxin Micro") in accordance with statutory procedures. Minxin Micro and its underwriters will negotiate with the Shanghai Stock Exchange to determine the issuance schedule and publish the prospectus in succession.

Entering brands such as Huawei, Transsion, and Xiaomi

Minxinwei is a semiconductor chip design company mainly engaged in the research and development and sales of MEMS sensors. It is able to independently design ASIC chips that provide signal conversion, processing or driving functions for MEMS sensor chips, and has achieved the localization of the entire production process of MEMS sensors.

Minxin Micro's main product lines currently include MEMS microphones, MEMS pressure sensors and MEMS inertial sensors. The company's products are currently mainly used in consumer electronics such as smartphones, tablets, laptops, wearable devices and smart homes, and are also gradually expanding their applications in the automotive and medical fields. Brands that have used the company's products include Huawei, Transsion, Xiaomi, Baidu, Alibaba, Lenovo, Sony, LG, etc. According to IHS Markit statistics, the company's MEMS microphone shipments ranked sixth and fifth in the world in 2016 and 2017.

From 2016 to January-June 2019, Minxinwei's operating performance grew rapidly, with operating income of RMB 72 million, RMB 113 million, RMB 253 million and RMB 138 million, respectively; net profit attributable to the parent was RMB 5.6243 million, RMB 13.0742 million, RMB 53.2513 million and RMB 28.7752 million; net profit attributable to the parent company's shareholders after deducting non-recurring gains and losses was RMB 3.9395 million, RMB 15.2717 million, RMB 61.3837 million and RMB 29.2254 million, respectively; comprehensive gross profit margins were 33.15%, 39.50%, 44.03% and 42.54%, respectively.

As of June 30, 2019, Minxinwei has 38 domestic and foreign invention patents and 17 utility model patents, and is applying for 16 domestic and foreign invention patents and 8 utility model patents, covering all business links such as chip design, wafer manufacturing, and packaging in MEMS sensors.

From 2016 to January-June 2019, the number of R&D personnel of Minxinwei continued to increase, reaching 31, 35, 58 and 76 respectively, accounting for 37.35%, 37.23%, 32.04% and 26.39% of the total number of employees respectively; during the same period, Minxinwei's total R&D expenses were RMB 10.0232 million, RMB 15.9512 million, RMB 27.3949 million and RMB 19.1047 million respectively, accounting for 13.89%, 14.10%, 10.84% ​​and 13.84% of the operating income respectively.

Self-built some packaging and testing production lines

At present, Minxin Micro has established long-term cooperative relationships with major wafer manufacturers and packaging manufacturers in the industry, such as SMIC, CSMC and Huatian Technology. At the same time, Minxin Micro is also building its own packaging and testing lines. In the future, it will realize independent packaging and testing of some products, strengthen quality control of the production process, and continuously improve product quality to meet the needs of downstream brand customers.

Minxinwei plans to raise 707 million yuan, which will be mainly used for the construction of a new MEMS microphone production base, a MEMS pressure sensor production project, a MEMS sensor technology R&D center construction project, and a supplementary working capital project.

Minxinwei stated that the investment projects with the raised funds are in line with the relevant national industrial policies and the company's development strategy, and are the development and supplement of the company's existing main business. They will help the company to upgrade its existing products and the research and development, design and promotion of new products, and consolidate the company's leading market position in the industry. At the same time, the smooth implementation of the fundraising and investment projects will further strengthen the company's R&D team, further enhance its R&D capabilities, further enhance its core competitiveness, and further increase the company's operating income and net profit scale.

Minxinwei also pointed out that the company's overall business goal is to continue to deepen its presence in the MEMS sensor field, develop from multiple dimensions both horizontally and vertically, and become a highly competitive enterprise in the industry. Horizontally, the company will develop more types of MEMS sensor products, and quickly industrialize them, expand emerging application areas, and seize the opportunities for industry development; vertically, the company will further expand its business, covering products such as MEMS sensor devices and modules, further expand the company's business scale, and enhance the company's profitability.