A listed A-share company worth 50 billion yuan is sending its subsidiary to Hong Kong for an IPO.

Companies in the robotics industry chain are still enthusiastic about listing in Hong Kong.

On July 15, Dahua Technology, with a market value of over 50 billion yuan, announced that the proposed listing venue of its controlled subsidiary, Zhejiang Huarui Technology Co., Ltd. (hereinafter referred to as "Huarui Technology"), has been changed from domestic stock exchanges to the Hong Kong Stock Exchange.

It should be noted that the robotics businesses of Dahua Technology and its wholly-owned subsidiary, Dahua Robotics, were "packaged and transferred" to Huarui Technology in December 2020. Less than a year later, in September 2021, the company filed for guidance with the Zhejiang Securities Regulatory Bureau, and China International Capital Corporation was the sponsoring institution.

Currently, there are three listed robotics companies in the Hong Kong stock market: Geek+ Technology, Dobot Robotics, and Ubtech Robotics, and they have not achieved profitability as of the end of 2024. According to incomplete statistics, 12 companies in the robotics industry chain have submitted listing applications to the Hong Kong Stock Exchange this year. In addition to startups such as Standard Robots, Woan Robotics, LeDong Robotics, and Seer Industry, A-share listed companies Estun Automation and Zhaowei Machinery are also aiming for an "A+H" listing.

As a technology company focusing on machine vision and mobile robotics, Huarui Technology, founded in February 2016, is committed to providing downstream users with end-to-end product solutions and system services through industrial Internet perception, algorithms, solutions, and a wide range of applications.

In March 2023, Dahua Technology announced that Huarui Technology planned to introduce investors through equity increase and share expansion, involving an investment of 260 million yuan. The investors included Fengyun Capital, Zhejiang Longsheng, Guoxuan High-Tech, Chendao Capital, and Zhu Jiangming. Zhu Jiangming is one of the main founders of Dahua Technology and has served as the vice chairman. As the founder of Leapmotor, he currently serves as the chairman of the company and the chairman of Leapmotor International.

The announcement released by Dahua Technology yesterday showed that as the controlling shareholder, it holds 32.58% of the shares of Huarui Technology. Zhang Xingming, the chairman (also the vice president of Dahua Technology), holds 3.69% of the shares, ranking as the fourth-largest shareholder. In addition, the Huatai Securities Huarui Technology Employee Stock Ownership Plan No. 1 and the CICC Huarui Technology Employee Stock Ownership Plan No. 1 hold 5.95% and 3.52% of the shares respectively, ranking as the second and fifth-largest shareholders of the company.

Source: Dahua Technology Announcement

According to the official website, more than 60% of Huarui Technology's employees are R & D personnel, and the company has applied for nearly 600+ patents. It is at the leading level in the industry in technical fields such as embedded software, image optimization, recognition algorithms, network transmission, navigation and positioning, scheduling, and motion control.

Currently, Huarui Technology's main business includes two major segments: machine vision and mobile robotics. Its products and solutions are widely used in industries such as logistics, automotive, 3C, lithium battery, photovoltaic, and pharmaceutical.

In the field of machine vision, Huarui Technology has developed an intelligent basic algorithm platform based on deep learning, as well as core components such as area scan industrial cameras, line scan industrial cameras, smart industrial cameras, 3D industrial cameras, code readers, algorithm libraries, and configurable software, enabling comprehensive visual industrial applications such as high-precision detection, recognition, measurement, and positioning guidance. Its products include industrial cameras, line scan cameras, smart cameras, smart sensors, 3D industrial cameras, and lenses, which are mainly used for code reading and recognition, defect detection, measurement, and positioning, providing customers with one-stop product procurement.

In the field of mobile robotics, Huarui Technology has independently developed various types of mobile robots, such as latent, transfer, fork-lift, and inspection robots. It integrates multiple autonomous navigation technologies such as laser, vision, and texture, and provides end-to-end industry applications such as handling, stacking, and automatic inspection through the robot scheduling system. Its products include latent, towing, fork-lift, and sorting robots, which are mainly used in logistics warehouses and material handling, providing end-to-end intelligent solutions for logistics handling.

In March this year, Dahua Technology's 2024 annual report showed that the company achieved an operating income of 32.181 billion yuan, a year-on-year decrease of 0.12%; the net profit attributable to the parent company was 2.906 billion yuan, a year-on-year decrease of 60.53%. Among them, the machine vision and mobile robotics business represented by Huarui Technology, as well as innovative businesses such as thermal imaging, automotive electronics, intelligent security inspection, intelligent fire protection, and storage media, achieved an operating income of 5.566 billion yuan, a year-on-year increase of 13.44%; the gross profit margin of this business was 32.35%, a year-on-year decrease of 2.62 percentage points.

Dahua Technology said in the announcement that this spin-off listing will help Huarui Technology further enhance its multi-channel financing ability and brand effect, form sustainable competitive advantages by strengthening resource integration and product R & D capabilities, make full use of the capital market, seize market development opportunities, promote intelligent manufacturing, continue the innovative development model of in-depth integration with the manufacturing industry, layout and penetrate more industries, and contribute to the digital and intelligent upgrading of the manufacturing industry.

It is worth mentioning that Dahua Technology's spin-off of Huarui Technology for an IPO in Hong Kong will also help it expand into the international market and enhance its global visibility.

Currently, Dahua Technology has invested in establishing 68 overseas subsidiaries and branches, and its products and services cover more than 180 countries and regions around the world. The 2024 annual report showed that the company achieved an operating income of 16.294 billion yuan in the overseas market, a year-on-year increase of 6.31%, accounting for 50.63% of the total operating income, exceeding the income scale of the domestic market.

This article is from the WeChat official account "Direct Access to IPO", written by Wang Fei, and published by 36Kr with authorization.