Baseband chip provider Zhongke Jingshang terminates its IPO on the Science and Technology Innovation Board

 On January 21, the Shanghai Stock Exchange issued a decision to terminate the review of the initial public offering and listing of Beijing Zhongke Jingshang Technology Co., Ltd. (hereinafter referred to as Zhongke Jingshang) on ​​the Science and Technology Innovation Board.

According to the disclosure, on January 20, 2021, Zhongke Jingshang and its sponsor CITIC Construction Investment Securities Co., Ltd. submitted to the Shanghai Stock Exchange the "Application of Beijing Zhongke Jingshang Technology Co., Ltd. to Withdraw the Application Documents for the Initial Public Offering and Listing on the Science and Technology Innovation Board" (Zhongke Jingshang [2021] No. 001) and "Application of CITIC Construction Investment Securities Co., Ltd. to Withdraw the Application Documents for the Initial Public Offering and Listing on the Science and Technology Innovation Board of Beijing Zhongke Jingshang Technology Co., Ltd." (Zhongjian Zhengfa [2021] No. 115), applying to withdraw the application documents. In accordance with the relevant provisions of the "Shanghai Stock Exchange Science and Technology Innovation Board Stock Issuance and Listing Review Rules", the Shanghai Stock Exchange decided to terminate the review of Zhongke Jingshang's initial public offering and listing on the Science and Technology Innovation Board.

Tianyancha shows that Zhongke Jingshang is committed to R&D and innovation in the fields of wireless communications, processor architecture and intelligent information processing. It has developed a communication-specific digital signal processor DSP core with an advanced large-scale parallel processor architecture and a dedicated instruction set optimized for communication baseband signal processing. It has independently developed a full range of wireless communication protocol stack software systems for air-ground networks, and its product system covers three major series of standards: second to fifth generation ground mobile communications, broadband wireless communications and satellite communications.

In terms of main business income, during the reporting period, Zhongke Jingshang's operating income continued to grow rapidly, with an average annual compound growth rate of 83.01% from 2017 to 2019. Driven by the continuous expansion of business scale, Zhongke Jingshang's net profit scale has grown synchronously, with an average annual compound growth rate of 40.95% from 2017 to 2019. Zhongke Jingshang insists on being market-oriented, enhancing its core competitiveness, and achieving sustained and stable growth in main business income.

It is understood that the growth rate of Zhongke Jingshang's net profit is lower than the growth rate of operating income, mainly due to the large increase in Zhongke Jingshang's R&D expenses. Faced with the rapidly growing downstream application demand, Zhongke Jingshang has increased its R&D efforts in core technologies and products. In order to enhance its R&D strength, Zhongke Jingshang has strengthened the construction of its R&D team, and R&D investment has continued to grow, providing a good guarantee for the continued growth of Zhongke Jingshang's revenue.

From the above analysis, it can be seen that during the reporting period, Zhongke Jingshang's operating conditions were good and it had the ability to continue operating.

The actual controller of Zhongke Jingshang is the Institute of Computing Technology of the Chinese Academy of Sciences, and its main technical personnel also have backgrounds in the Chinese Academy of Sciences, including Shi Jinglin, Liu Xinyu, Zhang Peiheng and other main senior executives, whose part-time units are all the Institute of Computing Technology of the Chinese Academy of Sciences; the main technical personnel are General Manager Hu Jinlong, Deputy General Manager Zhang Yucheng, Deputy General Manager Yang Xiaojun, Employee Supervisor Yuan Yao, and System General Manager Su Yongtao. All of the above five have backgrounds in the Institute of Computing Technology of the Chinese Academy of Sciences.

It can be said that a high-quality R&D team is an important part of the company's core competitiveness and the foundation and key for the company's survival and development. According to the prospectus, Zhongke Jingshang's technical R&D personnel account for 76.44% of the total number of employees, and 88.89% have a bachelor's degree or above.

It is worth noting that in addition to R&D technical talents, R&D investment strength also has a crucial impact on the company's R&D level.

According to the prospectus, Zhongke Jingshang belongs to the new generation of information technology industry. Its scientific and technological innovation attributes lie in its high proportion of R&D investment and strong invention patent strength.

Data shows that Zhongke Jingshang's cumulative R&D investment in 2017, 2018 and 2019 was RMB 91.6943 million, accounting for 32.64% of its cumulative operating income. As of June 30, 2020, the company has obtained 40 invention patents, and more than 5 invention patents have generated main business income, demonstrating its R&D strength.

Based on its R&D strength and technical team support, Zhongke Jingshang will extend its tentacles to other fields, such as 5G baseband chips or digital processor chips. However, in the era of oligopoly competition in the global baseband chip market, industry giants such as Qualcomm, Huawei, and MediaTek have occupied most of the market share. The gap between Zhongke Jingshang and the industry leader in this field is also obvious, and it is difficult to determine whether it can get a share.