Analysis of the Sustainability of Bangze Chuangke's Performance Surge Ahead of Its IPO

I will now systematically analyze the sustainability of the surge in Bangze Chuangke’s performance ahead of its IPO. Based on collected public information and regulatory inquiry materials, I will conduct an in-depth analysis from multiple dimensions.

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Bangze Chuangke (Guangdong Bangze Chuangke Electric Co., Ltd.) submitted its prospectus on June 13, 2025, seeking listing on the Beijing Stock Exchange. On January 8, 2026, the company’s IPO application was approved by the Listing Committee [1].

Financial Indicator	2022	2023	2024	2025 (Estimated)
Operating Revenue (RMB 100 million)	10.71	11.68	15.10	17.6-18.2
Net Profit Attributable to Parent Company (RMB 10,000)	714.12	10,800	14,800	16,000-17,000
YoY Growth Rate	-	1412%	37%	8%-15%
Gross Profit Margin	28.78%	39.46%	40.22%	~41%

As can be seen from the data, Bangze Chuangke recorded a significant performance surge ahead of its IPO, especially in 2023 when net profit skyrocketed from RMB 7.14 million to RMB 108 million, representing a growth rate of 1412% [2].

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According to the prospectus and inquiry responses, Bangze Chuangke’s performance growth is mainly driven by the following factors [2][3]:

• In 2023, the sales proportion of higher-unit-price own brand/licensed brand businesses such as paper shredders increased
• The proportion of online sales revenue from own brands in main business revenue increased from 49.96% in 2022 to 62.53% in 2023
• This segment has a higher gross profit margin, driving the overall gross profit margin up from 28.78% to 39.46%

• The proportion of sales revenue generated through overseas e-commerce platforms such as Amazon in main business revenue increased from 48.45% in 2022 to 60.54% in 2023
• Amazon has become the company’s most important sales channel

• In 2024, the ODM business expanded product categories for existing customers and continued to develop new customers
• ODM business revenue increased by RMB 152 million year-on-year, representing a growth rate of 36.78%

The main reasons for the sharp rise in gross profit margin in 2023 include [4]:

1. Change in Product Sales Model Structure
   : Increased proportion of own brand business with high gross profit margin
2. Lean Improvement of Products
   : Reduction of unit product cost
3. Decline in Sea Freight Rates
   : Eased pressure from previous shipping costs
4. Decline in Raw Material Procurement Prices
   : Reduced pressure on the cost side
5. Appreciation of USD against RMB
   : Beneficial to export business

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During the review process, the Beijing Stock Exchange Listing Committee focused on the

of Bangze Chuangke’s performance growth and conducted multiple rounds of inquiries [1][3]:

• Sustainability of sales revenue growth of paper shredders from 2023 to 2024
• Impact of new product definition and iteration on revenue
• Reasons for significant differences in gross profit margin of the same product model across different years

• Risks of the company’s operating model with no outstanding orders for online sales
• Rationality of the higher net profit growth rate compared to peer companies
• Market stability of the consumer immediate purchase model

• Degree of dependence on the Amazon platform (nearly 60%)
• Potential impact of changes in platform policies
• Risk of account suspension and response measures

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• The company’s overseas sales revenue accounts for over 95% of total revenue [2]
• Dependence on the Amazon platform is close to 60% [2]
• The proportion of sales revenue generated through Amazon was 48.45%, 60.54%, and 58.49% in 2022, 2023, and 2024 respectively
• Any adjustment to platform policies (such as account suspension, commission increases) will have a direct impact on the company

• The company’s sales expense ratio is much higher than that of peer companies in the same industry [2]
• The sustainability of the growth model driven by high marketing investment is questionable
• In contrast, the R&D expense ratio is only 2.15%-2.51%, significantly lower than the industry average of 3.61%-4.42%

Indicator	2022	2023	2024	H1 2025
Accounts Receivable as a Percentage of Revenue	4.82%	11.23%	11.53%	21.36%
Book Value of Inventory (RMB 100 million)	1.46	1.81	2.52	2.99
Inventory as a Percentage of Current Assets	44.18%	40.34%	40.35%	46.88%

As of the end of H1 2025, the balance of accounts receivable is nearly RMB 200 million, and the book value of inventory is nearly RMB 300 million, resulting in certain capital occupation pressure [2].

• The office appliance and household appliance markets are highly competitive
• Peer companies such as Bear Electric, Xinbao Shares, and Deerma have stronger brand influence and R&D capabilities
• Bangze Chuangke has a relatively single product category, mainly relying on office products such as paper shredders

• Gross profit margin increased from 28.78% in 2022 to 41.44% in H1 2025
• Reflecting the optimization of product structure and improvement of cost control capabilities

• ODM customers include internationally renowned retailers such as Amazon, Walmart, Sam’s Club, Best Buy, and Staples
• Reducing the risk of dependence on a single customer

• The funds raised from the IPO will be invested in the “Bangze Chuangke Electrical Intelligent Manufacturing Base Project” and the “Headquarters and R&D Center Project”
• Helping to increase production capacity and R&D capabilities, and enhance long-term competitiveness

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Company	2024 R&D Expense Ratio	2024 Gross Profit Margin	Business Model
Bear Electric	4.09%	~32%	Domestic sales-focused, own brand
Xinbao Shares	3.94%	~17%	ODM-focused
Deerma	5.37%	~29%	Brand diversification
Buydeem	5.14%	~49%	High-end own brand
Bangze Chuangke	2.51%	40.22%	Cross-border e-commerce + ODM

• Bangze Chuangke’s R&D expense ratio is
  significantly lower than the industry average
• Its gross profit margin performance is
  better than most peer companies
  , mainly benefiting from the increased proportion of own brand business
• Its business model is relatively similar to Xinbao Shares, but it relies more on e-commerce platforms for sales channels

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• From January to September 2025, revenue increased by 25.71% year-on-year to RMB 1.354 billion, and net profit increased by 24.77% year-on-year to RMB 121 million [2]
• Gross profit margin remains at a high level of over 40%
• Full-year 2025 revenue is expected to be RMB 1.76-1.82 billion, with net profit of RMB 160-170 million

• Uncertainty of Amazon platform policies
• High base effect may lead to growth slowdown
• Continuous increase in sales expense investment may squeeze profit margins

1. Insufficient R&D Investment
   : The R&D expense ratio is only about half of the industry average, limiting product innovation capabilities
2. Weak Brand Moat
   : Reliance on third-party platforms, and the premium capability of its own brand remains to be verified
3. Limited Market Space
   : Office appliances such as paper shredders are affected by the trend of paperless office
4. Macroeconomic Risks
   : The high proportion of overseas revenue makes the company vulnerable to exchange rate fluctuations and changes in international trade environment

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1. Performance Fluctuation Risk
   : After the explosive growth in 2023, the growth rate fell to 37% in 2024, and is expected to further drop to 8%-15% in 2025
2. Platform Dependency Risk
   : Nearly 60% of revenue comes from Amazon, and changes in platform policies may have a significant impact on the company
3. Risk of Gross Profit Margin Decline
   : If the growth of own brand business slows down or costs rise, the gross profit margin may fall
4. Risk of IPO-funded Projects
   : There is uncertainty about whether the intelligent manufacturing base and R&D center projects can generate expected benefits

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The surge in Bangze Chuangke’s performance ahead of its IPO is mainly driven by three factors:

, , and . In the short term, the company’s performance growth still has certain inertia, but .

The regulatory authorities’ inquiries into the authenticity and sustainability of performance also reflect market concerns in this regard. Investors should focus on the following aspects:

• Whether the company can reduce its dependence on the Amazon platform
• Whether R&D investment can be increased to enhance product competitiveness
• Whether the own brand can continue to gain consumer recognition
• Whether the gross profit margin can be maintained at the current level

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[1] Securities Times - “Two Companies Approved at the Start of the Year, Beijing Stock Exchange IPO Review Speeds Up Again” (https://www.stcn.com/article/detail/3585438.html)

[2] Eastmoney - “Bangze Chuangke’s Gamble with Midea: Sales Expense Ratio Far Higher than Peers, R&D Expense Ratio Weak” (https://caifuhao.eastmoney.com/news/20260108134306653554700)

[3] OFweek - “First Case on Beijing Stock Exchange! Guangdao Digital Forced to Delist for Financial Fraud” (https://mp.ofweek.com/finance/a456714600627)

[4] Eastmoney Securities Research - Bangze Chuangke Prospectus and Review Inquiry Responses