Stock prices have picked up, Jimi Technology employees have reduced their holdings, and the projector leader, which once had a market value of more than 40 billion yuan, has to continue to clear inventory.

Photo source: Visual China

Blue Whale News February 14 (Reporter Wang Jianwen)The share price of Jimi Technology (688696.SH) rebounded, and some shareholding employees took the opportunity to reduce their holdings.

On the evening of February 12, Jimi Technology issued an announcement stating that the company’s shareholders Jimi Consulting, Kaixin Mihua and Liao Chuanjun planned to inquire and transfer a total of 1.9785 million shares of the company’s shares, accounting for 2.83% of the total share capital. After inquiry, it was initially determined that the transfer price was 102 yuan/share, and the transferees were 11 institutional investors.

The announcement shows that Jimi Consulting and Kaixin Mihua are both employee stock ownership platforms of Jimi Technology, and Liao Chuanjun is the chairman of the company’s supervisory board. This also means that the main body of this reduction is mainly executives and employees of Jimi Technology. Based on a stock price of 102 yuan/share, the total cash cash available to Jimi Technology employees this time is approximately 202 million yuan.

As the first company in projectors, Jimi Technology was once sought after by the capital market at the beginning of its listing, with a market value of 43.9 billion yuan. However, since 2023, the company’s performance has begun to decline, and the stock price has continued to fall accordingly. In order to boost its performance, Jimi Technology began to seek new performance growth points. While betting on going out to sea, it was planning to expand the car projection market.

The stock price has rebounded, employees are busy reducing their holdings. Baidu has already cashed in 850 million yuan.

Jimi Technology was established in 2013 and will be listed on the Science and Technology Innovation Board in March 2021. As the first company in projectors, Jimi Technology was once sought after by the capital market at the beginning of its listing.“” As of June 2021, the company’s share price hit a maximum of 614.43 yuan/share, with a total market value of approximately 43.9 billion yuan. However, since then, the company’s share price has continued to fall, falling to a low of 50.71 yuan/share by August 2024, and the market value has also dropped to approximately 3.6 billion yuan, evaporating more than 40 billion yuan from the 2021 high.

Since late September 2024, A-shares have generally recovered, and the share price of Jimi Technology has also risen accordingly. As of the close of February 14, the company’s share price closed at 112.90 yuan/share, with a total market value of approximately 7.9 billion yuan.

Just as the stock price of Jimi Technology is picking up, the company’s employee stock ownership platform Jimi Consulting, Kaixin Mihua, and Liao Chuan, chairman of the company’s supervisory board, announced that they would reduce their shares in the company.

The prospectus shows that Jimi Consulting, Kaixin Mihua and Liao Chuan are all former shareholders of Jimi Technology. Liao Chuanjun is one of the founding shareholders of Jimi Technology. Jimi Consulting and Kaixin Mihua invested in 2015 and 2019 respectively. In March 2024, the ban on the shares held by the above-mentioned shareholders was lifted.

In this equity transfer, Jimi Consulting and Kaixin Mihua plan to transfer 2.15% and 0.58% of the company’s shares respectively, accounting for 86.47% and 91.50% of their shareholding ratios respectively. Liao Chuanjun plans to transfer 0.10% of the company’s shares, accounting for 25% of his shareholding. Based on the transfer price of 102 yuan/share, the above shareholders will cash in approximately 202 million yuan.

Before this collective employee reduction, some shareholders of Jimi Technology had already begun to reduce their holdings and cash in large amounts.

As early as 2017, Jimi Technology received investment from Baidu. At the time of listing, Baidu Netcom and Baidu Biwei held 9.88% and 1.73% of the company’s shares respectively. With the lifting of the ban on the shares held by the two companies in March 2022, Baidu began to gradually reduce its shares in the company.

As of August 2024, Baidu and two companies have made a total of 4 reductions. As of the end of the third quarter of 2024, the shareholding ratios of Baidu Netcom and Baidu Biwei have dropped to 5.04% and 0.49%. During this period, Baidu has cashed in a total of approximately 850 million yuan.

The market’s downward performance turned from profit to loss, betting on sea + vehicle-mounted vehicles”

As the first company in projectors, Jimi Technology’s performance growth before listing was very impressive.

From 2019 to 2021, Jimi Technology’s operating income was 2.116 billion yuan, 2.828 billion yuan, and 4.038 billion yuan respectively; its parent net profit was 93 million yuan, 269 million yuan, and 483 million yuan respectively.

But by 2023, the projector market will gradually turn cold. Data from OviCloud shows that in 2023, the retail sales of smart projection in China will be 6.12 million units, a year-on-year decrease of 20.3%; the retail sales will be 10.46 billion yuan, a year-on-year decrease of 33.2%. In this context, the performance of Jimi Technology has also begun to decline. In 2023, the company’s operating income will be 3.557 billion yuan, down 15.77% year-on-year; net profit attributable to the parent company will be 121 million yuan, down 75.97% year-on-year.

Projector sales are under pressure, and the inventory scale of Jimi Technology continues to remain high. As of the end of 2023, the book value of the company’s inventories was 1.098 billion yuan, accounting for 19.67% of the company’s total assets. In order to reduce the inventory size, Jimi Technology chose to reduce prices and promote sales. The company stated in its 2024 semi-annual report that with the further expansion of the smart projection equipment market and the entry of new participants, market competition is expected to further intensify, and the company’s products may be reduced in price.

But at present, it seems that although the price reduction promotion has reduced the inventory size, it has also further lowered the performance of Jimi Technology.

As of the end of the third quarter of 2024, the book value of Jimi Technology’s inventory was 983 million yuan, accounting for 18.66% of total assets. Both the total amount and proportion declined compared with the end of 2023. However, in terms of performance, in the first three quarters of 2024, the company’s operating income dropped by 5.80% year-on-year to 2.281 billion yuan, gross profit margin dropped by 4.04% year-on-year to 28.77%, and profit also turned from profit to loss, with a net loss attributable to the parent company for the current period of 40 million yuan.

In this context, Jimi Technology had to adjust its original business route, jump out of the domestic home projector market, and look for new performance growth points. To this end, the company is betting on going out to sea while seeking to break through the in-vehicle projection market.

In terms of going to sea, Jimi Technology has mainly focused its attention on markets in Europe, North America and Japan. In January this year, the company stated at an investor exchange meeting that the company is continuing to promote the construction of overseas localization teams and continuously improving offline channel coverage. At present, the company’s products have entered overseas retail channels such as Best Buy, Sam ‘s Club, Walmart, Tsutaya Home Appliances, and Friends Baxi.

In addition, Jimi Technology is also deploying in-vehicle projection business. The 2024 semi-annual report shows that the company will mainly develop smart cockpits, smart headlights, HUD (Head-Up Display System) and other businesses. At present, the company has established a production line for vehicle-mounted projection products at its Yibin production base.

At present, Jimi Technology has achieved certain results in its overseas business. In the first half of 2024, the company’s overseas revenue was 448 million yuan, a year-on-year increase of 27.95%. However, the specific performance of the in-vehicle business remains to be observed. Previously, the company stated at an investor exchange meeting that the company will start building an in-vehicle team in early 2024 and expects to start delivery of in-vehicle fixed-point vehicles in 2025.