Seashell Material Technology (02560) will be conducting a global offering of 145 million H shares from December 31 to January 6.

Seashell Materials Technology (02560) is scheduled for IPO from December 31, 2024 to January 6, 2025. The company plans to globally issue 145 million H shares, with 10% of the shares sold in Hong Kong and 90% sold internationally, with an additional 15% of over-allotment option. The offer price is set at 3.0-3.3 Hong Kong dollars per share, with a board lot of 1,000 shares. It is expected that trading of H shares on the Stock Exchange of Hong Kong will begin on January 9, 2025 (Thursday). The company is a supplier of fine chemical materials that produce and sell cement additives, concrete additives, and related upstream materials. With its R&D efforts and capabilities, the company also provides technical support related to its products to customers. According to Frost & Sullivan data, based on sales and revenue of cement additives in the 2023 financial year, the company ranks first in China with market shares of approximately 28.3% and 32.3% respectively. In the 2023 financial year, the company's sales of concrete additives accounted for approximately 0.8% of total sales in China, and its revenue from concrete additives accounted for approximately 0.6% of total revenue in China. Additionally, the company's sales of ethanolamine products accounted for approximately 4.7% of total sales in China, and its revenue from ethanolamine products accounted for approximately 3.9% of total revenue in China. The company's sales of polyether monomers accounted for approximately 0.9% of total sales in China, and its revenue from polyether monomers accounted for approximately 1.0% of total revenue in China. The company was founded by Fortune China 500 company Conch Group (ranked 135th in 2024), as a leading enterprise with comprehensive capabilities in the cement and concrete industry, committed to expanding the market for fine chemical materials. The company's total revenue for the fiscal years 2021, 2022, and 2023 were RMB 1.538 billion, RMB 1.84 billion, and RMB 2.396 billion respectively. The compound annual growth rate for the three fiscal years ending December 31, 2023, was 24.8%. The company's net profit for the fiscal years 2021, 2022, and 2023 were RMB 127 million, RMB 92.4 million, and RMB 144 million respectively. The company's revenue increased from RMB 1.036 billion for the six months ending in 2023 to RMB 1.103 billion for the six months ending in 2024, representing a 6.6% increase. The net profit for the same periods increased from RMB 47.7 million to RMB 60.2 million, a 26.2% increase. The company has entered into cornerstone investment agreements with Gotion High-Tech Co., Ltd. (Gotion High-Tech), Anhui Shengchang Chemical Co., Ltd. (Anhui Shengchang), Wuhu Atek Biological Technology Co., Ltd. (Wuhu Atek), SCGC Capital Holdings Ltd. (SCGC Capital), Guangdong Zhongxing Technology Co., Ltd. (Guangdong Zhongxing), and Shenzhen Gaodeng Computer Technology Co., Ltd. (Shenzhen Gaodeng), under certain conditions and restrictions. The cornerstone investors have agreed to subscribe or cause designated entities to subscribe for approximately RMB 302 million (or approximately HKD 327 million) worth of shares at the offer price. Assuming an offer price of HKD 3.15 per share and the over-allotment option not being exercised, the company estimates that it will receive a net amount of approximately HKD 418 million from the global offering. Approximately 35.0% of the proceeds will be used to optimize the group's production capacity and effectively expand the company's geographic coverage in China and several overseas countries to consolidate its position as one of China's leading suppliers of fine chemical materials. Approximately 10.0% will be used to implement marketing plans to increase and solidify the company's market share in the cement and concrete manufacturing industry in China and globally. Approximately 15.0% will be used to further invest resources in supporting the company's market position through research and development plans. Approximately 15.0% will be used to repay part of the bank loans. Approximately 15.0% will be used to further enhance the company's position in the value chain through acquisitions or establishment of joint ventures, and to enhance the company's competitiveness as a leading player in the cement additives industry in China. Approximately 10.0% will be used for working capital and other general corporate purposes.