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Last week (August 5th to 11th), a total of 5 companies planning to go public had their reviews terminated at the Shanghai and Shenzhen Stock Exchanges, and 2 companies had their reviews terminated at the Beijing Stock Exchange.

Among them, the three companies that applied for listing on the Shanghai Stock Exchange are Analogix Semiconductor (Suzhou) Co., Ltd., Hunan Xingbang Intelligent Equipment Co., Ltd., and Jiangsu Baozhong Baoda Pharmaceutical Co., Ltd. (hereinafter referred to as "Baozhong Baoda"); the two companies that applied for listing on the Shenzhen Stock Exchange are Essoka Technology Co., Ltd. and Hebei Yippin Pharmaceutical Co., Ltd. (hereinafter referred to as "Yipin Pharmaceutical").

Baozhong Baoda's complex relationship between persons acting in concert

Baozhong Baoda's IPO application was accepted on June 30, 2023, and entered the inquiry stage on July 25 of the same year. After responding to a round of inquiries and updating financial data, its review was terminated on August 6 this year due to withdrawal of the order.

The company has a high customer concentration, mainly providing customized production services for plant protection technical and lithium materials for global plant protection company FMC and new material lithium company LIVENT. LIVENT is an independent spin-off from FMC and is the second largest customer of Baozhong Baoda during the reporting period (2020-2022).

From 2020 to 2022, the sales revenue from the top five customers accounted for 94.01%, 93.74% and 95.15% of Baozhong Baoda's operating income respectively, of which the sales revenue to FMC accounted for 77.05%, 73.58% and 73.64% respectively. In other words, more than 70% of Baozhong Baoda's revenue comes from a single customer.