China Electric Motor (CELM), which manufactures micro-motor products for household appliances, vehicles and other consumer devices, is expected to price its IPO this week.
Business Overview (from prospectus)
Through Shenzhen YPC, we engage in the design, production, marketing and sale of micro-motor products. Our products, which are incorporated into consumer electronics, automobiles, power tools, toys and household appliances, are sold under our “Sunna” brand name.
We are focused on providing micro-motor products that meet the growing demand for efficient, quiet and compact motors from manufacturers of consumer electronics, automobiles, power tools, toys and household appliances. We produce both Direct Current (“DC”) motors and Alternating Current (“AC”) motors, each of which has different functions and uses. We sell our products directly to original equipment manufacturers and to distributors and resellers both domestically in the PRC and internationally to customers in Korea and Hong Kong. Our manufacturing facilities are located in Shenzhen, Guangdong in our 15,000 square meter (approximately 161,000 square feet) factory. As of September 30, 2009, we had approximately 920 full-time employees.
Offering: 4.3 million shares at $6-$7 per share. Net proceeds of approximately $22.7 million will be used for working capital, to create a public market for the company's common stock; to increase manufacturing capacity and to modernize factory equipment; and for general corporate purposes.
Lead Underwriters: Roth Capital, Westpark Capital
Revenues for the nine months ended September 30, 2009 were $63.3 million, an increase of 62.1%, compared to revenues of $39.0 million for the nine months ended September 30, 2008...Cost of goods sold was $45.5 million for the nine months ended September 30, 2009, an increase of $17.4 million, or 61.8%, compared to $28.1 million for the nine months ended September 30, 2008...Gross profit for the nine months ended September 30, 2009, was $17.8 million, or 28.2% of revenues, compared to $10.9 million, or 28.0% of revenues, for the comparable period in 2008...Net Income for the nine months ended September 30, 2009 was $8.3 million compared to $6.0 million for the nine months ended September 30, 2008.
We face competition from many other micro-motor manufacturers, most of which have significantly greater name recognition and financial, technical, manufacturing, personnel, marketing, and other resources than we have. Our competitors may be able to respond more rapidly than we can to new or emerging technologies or changes in customer requirements. They may also devote greater resources to the development, promotion and sale of their products than we do. We compete primarily on the basis of quality, price, reliability, brand recognition, and quality assurance and support to our customers. Our primary competitors include Wolong Holding Group Co., Ltd., a manufacturer of micro and specialty motors; Shanghai Motor Co., Ltd., a manufacturer of turbo generators and large-scale TAC DC motors; Shangdong Electric Group, a maker of general motors; Nanyang Explosion-proof Electrical Group and Jiamusi Electric Corp., both manufacturers of explosion-proof and high-voltage motors; Xinagtan Electric Group Co., a producer of traction motors and high-voltage motors; Zhangqiu Haier Appliances Motor Co., Ltd., a maker of appliance motors; and Xima Motor Group, Co., Ltd. and Jiangsu Dazhong Electric Corp., manufacturers of high-voltage motors and DC motors.
- Company website
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