Economic Observer Network reporter Qian Yujuan On March 15, iSoftStone was listed on the Growth Enterprise Market of the Shenzhen Stock Exchange with the stock code of 301236 and the issue price was 72.88 yuan per share.
Founded 21 years ago, iSoftStone, as one of China’s digital technology service companies, was listed on the New York Stock Exchange as early as 2010, opted for privatization in 2013, and successfully retired from the US stock market in September 2014. city.
Since then, iSoftStone has attempted to return to A-shares through asset restructuring three times, namely with Wantong Technology in 2016, with Ziguang University in 2018, and with Xianglong Electric in 2019. However, they all ended in failure.
In March 2021, iSoftStone decided to go public independently, submitted an IPO application to the GEM, and successfully attended the meeting in September of that year.
iSoftStone, which has been chasing A-shares for 6 years, finally officially landed on the Growth Enterprise Market in March 2022.
At present, the founder and chairman of iSoftStone, Liu Tianwen, is the company’s largest shareholder with a shareholding ratio of 23.75%. In order to go public independently, iSoftStone has introduced well-known investment institutions such as Chunhua Qiushi, Yunfeng Qitai, Fortune Ventures, and Shenzhen Ventures. Among them, Yunfeng Qitai, with a shareholding ratio of 3.31%, attracts attention because of the major shareholder of Alibaba (China) Network Technology Co., Ltd.
When Yunfeng Qitai invested in iSoftStone in July 2020, it also attracted institutional shareholders such as Tianshutong and Zijin Wentou. At that time, iSoftStone explained in its prospectus to the new shareholders, “Some of the issuer’s old shareholders need to reduce their holdings or withdraw due to reasons such as their own or their upper-level investors’ cashing needs or the expiration of the fund’s duration. At the same time, Some new investors are optimistic about the company’s future development.”
Not only is there a connection at the capital level, Alibaba is also a major customer of iSoftStone. In iSoftStone’s ranking of major customers in the first half of 2021, Huawei ranks first, followed by Internet technology companies such as Alibaba, Tencent, and Baidu.
According to the prospectus, Huawei is iSoftStone’s largest long-term customer, with sales accounting for more than 50% of the company’s current revenue. In response to the problem of proportion, iSoftStone also stated that “Huawei has a large business scale and many product lines.”
iSoftStone introduced the company in the prospectus submitted. It is a software and information technology service provider with profound industry accumulation and comprehensive technical strength. Its main business is for communication equipment, Internet services, finance, high-tech and manufacturing industries. customers, providing end-to-end software and digital technology services and digital operations services.
To put it simply, as an IT business outsourcing service provider, iSoftStone mainly provides labor-intensive outsourcing business services for IT companies such as Huawei, Alibaba, Tencent, and Baidu to benefit.
Judging from its announced financial situation, since 2019, the company’s total revenue has increased year after year, and it has remained above the scale of 10 billion yuan, while the company’s annual operating income in 2021 is as high as 16.62 billion yuan.
From the prospectus of iSoftStone, it can be seen that the number of its registered employees will reach 71,141 in 2020, and the reporter visited its official website and saw such an introduction, iSoftStone’s global service network covers 40+ cities, 100+ Branch structure with 85,000+ employees”.
Qu Jianfeng, co-founder and general manager of Shanghai Zhongyun Enterprise Service Outsourcing Co., Ltd., said in an interview with reporters that iSoftStone, as an outsourcing service platform, has brought manpower to itself in the process of importing flexible employment to giant enterprises and large factories. Risks such as rising costs and labor disputes.
In this regard, iSoftStone mentioned in the prospectus that the proportion of the company’s employee compensation to the main business cost and period expenses (excluding financial expenses) is increasing year by year. The reporter found on the enterprise information inquiry platform Tianyan that as of February 24 this year, most of the hundreds of legal proceedings and filing information involving iSoftStone were caused by labor disputes and technical service contract disputes.
As a manpower outsourcing company, while facing the above risks, the reporter also learned that there are many outsourcing service providers backed by large manufacturers, such as Chinasoft International, Farben Information, Beyondsoft, etc. There is a lot of competition in general.
At the same time, since 2021, major factories including Alibaba, Tencent, Baidu, etc. have been reported to have laid off employees in different degrees and scales by means of structural optimization. As the outsourcing service providers behind them, they are also facing the risk of customer concentration. In this regard, iSoftStone reminded in its prospectus, “If the main customers’ demand for the company’s business decreases due to changes in the domestic and foreign macro environment or their own business conditions, or they turn to other suppliers, the company’s production and operation will be affected. have a negative impact.”
As of press time, iSoftStone’s share price was at 60.54 yuan per share, a drop of 16.93%.
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