Rebirth 08: Rise from copycat phones

Chapter 444: Weiku Electronics Goes Public
Shenzhen, Weiku Electronics Building.

This building, which is only four or five kilometers away from the headquarters of Zhiyun Group, was once the headquarters of Zhiyun Technology.

However, since the Zhiyun Group's headquarters moved to the headquarters park, the building was first rented by Wecoo Electronics Group Co., Ltd. Later, Wecoo Electronics invested in purchasing the property rights of the building from Zhiyun Group and then used the building as its own group headquarters.

The more than 40-story Wecoo Electronics Building is enough to demonstrate the status of Wecoo Electronics Group... After all, Wecoo Electronics cannot be compared with a behemoth like Zhiyun Group. It is just a very typical smart terminal company engaged in design, R&D, and marketing, and its R&D part is relatively small.

Like most domestic smart terminal manufacturers, Weiku Electronics uses the country's mature supply chain to carry out design integration, then entrusts it to OEM factories for production, and finally sells it. It is a very typical light asset enterprise.

Of course, this does not mean that they have no fixed assets. In fact, although WeCool Electronics seems to have no factories at its headquarters, it actually holds shares in many supply chain companies through investment and support of the supply chain.

After all, no matter what, Weiku Electronics is the fourth largest smart terminal manufacturer in the world in terms of revenue. In terms of sales, it is even ranked third in the world, and the gap with Four Star is very small.

It sells more than 200 million smartphones a year and is involved in almost all smart terminal fields, from business notebooks to tablets, smart watches (mainly children's watches), sports bracelets, Bluetooth headsets, to televisions, kettles, sweepers, balance bikes and even drones.

They all did it!

To some extent, Weiku Electronics is a low-profile version of the smart terminal business in Zhiyun Group... It's not that their products are sold cheaply. Expensive or cheap products cannot demonstrate the strength of a company... Being able to make high-tech products at low prices and then sweep the market is also high-tech and very impressive.

The seemingly high-end chip industry is a typical example. It uses extremely high technology to make top-level chips affordable for everyone... The material cost of the S903 chip equivalent to the seven-nanometer process is only a few hundred yuan; if it is a chip with mature processes such as the -nanometer process, it can be bought for a few dozen yuan.

For earlier mature processes such as 65 nanometers, if the production and sales volume is large enough, the price of some small chips can even be reduced to only a few dollars.

Chip products are top-level products that integrate countless top technologies of mankind and are the most precise industrial products that can be made in human history.

But this thing can be sold to you for a few dollars or even a few cents...

This chip industry structure where high technology and low prices coexist also means that the threshold to entry into the chip industry is very high. Few countries or companies can afford to play with it. The core reason why there are only a few players left in the era of advanced process technology is: it’s too competitive!
An investment in a chip factory of over 10 billion dollars, a development cost of several hundred million dollars for a chip design, and the final manufactured chips are only sold for tens of dollars... This is enough to make countless companies in the world despair at a glance!
Therefore, the price of a product alone cannot be used as a reason to measure the strength of a company.

The reason why Weiku Electronics is called the low-end version of Weiku Electronics' smart terminal business is not because its products are sold cheaply, but because it does not have any core technology of its own.

The system and all the parts are all borrowed...

The so-called research and development is actually on a very small scale, and is also focused on surface applications such as the design and integration of smart terminals.

To put it simply, it means finding various spare parts suppliers on the market and then combining the spare parts together.

However, although many people dislike that Weiku Electronics does not have its own core technology, it has still become the world's fourth largest smart terminal manufacturer, and its mobile phone sales rank among the top three globally.

This year's estimated annual revenue will reach US$62 billion, and the net profit attributable to shareholders will increase significantly to approximately US$6.3 billion.

This revenue and profit are actually very good in the country!

In the field of domestic technology companies, there are actually very few companies whose revenue can exceed that of Weiku Electronics. The first one is Zhiyun Group. Zhiyun Group is far ahead of other domestic companies. With a revenue of 400 billion US dollars, it is the leader not only in China, but also in the world.
Next is Huawei, which has achieved success in both the communications and smart terminal fields. It has also benefited from the rapid development of mobile Internet and is very profitable in the communications field. Although their smart terminal business is relatively poor, it is still ranked third in China and sixth in the world.

Ranked third is Weiku Electronics Group.

Weiku Electronics Group ranks around 150th among the world's top 500 companies, and its revenue ranks among the top 30 among many domestic companies!
Among domestic high-tech companies, Weiku Electronics Group's revenue scale ranks among the top three in the country... second only to Zhiyun and Huawei!
Although Weiku Electronics seems to be just a design and assembly company with little technology, it is large in scale, has huge revenue, and is very strong overall.

Behind Weiku Electronics is Hailan Automobile, which spans both the high-tech field and the automotive field. This company is quite special... because they make smart electric cars, and they always use high-tech terms like assisted driving and smart driving. Many consumers buy their cars because of their high technology.

So, sometimes people regard it as a high-tech company, and at the same time regard it as a car manufacturer...the company's positioning is somewhat contradictory.

This is also the special feature of many new forces in the non-traditional automobile industry.

Hailan Automobile's revenue and profit are also very good. It is expected to have a revenue of more than 58 billion US dollars this year. Although the sales of some old models, especially the Hailan SEC coupe and the Hailan SEV large SUV, the two former ace models, have plummeted, the success of the Hailan SLMC mid-size sedan and the Hailan MEV mid-size SUV has taken over the responsibility of sales and revenue. In addition, this year Hailan Automobile has also obtained considerable revenue from the external sales of semi-solid batteries... Hailan Automobile's battery factory has supplied a large number of semi-solid battery cells to Zhiyun Group, and this part of the revenue is also quite large.

Next are some other large high-tech companies in China that are familiar to people, such as Xiaomi and OV in the field of smart terminals... These two companies are also very strong in the mobile phone field.

In addition, there are four major Internet giants in the software and Internet fields, such as Yihai Technology and Tencent.

The above-mentioned high-tech companies are basically some of the high-tech companies that people are more familiar with.

There are also some high-tech companies that are not very familiar to ordinary people, but are also extremely important and are doing very well in the industry, such as many supply chain companies in the consumer electronics industry chain. They are actually doing very well.

For example, in the screen field, there are CSOT and BOE.

Goertek in acoustic components.

Engaged in chip design and various semiconductor sensor businesses, its core products include touch IC, fingerprint recognition module, under-screen photoelectric fingerprint recognition module signing technology, etc.

Then there are OEM companies that are considered by many to have little technical content, but in fact have high technical content, such as BYD OEM, Weiku Industrial, Luxshare, etc. Organizing tens of thousands or even hundreds of thousands of people to carry out large-scale OEM production of precision electronic equipment, and to control the yield and production efficiency at a very high level, this is not a simple task, and to be honest, the technical content is also very high.

Although Weiku Industry is just an OEM and seems to be in a low-end labor-intensive industry, it is actually also a precision equipment manufacturer. Many assembly equipment needed for domestic mobile phone production are designed by them... Every time Zhiyun Group, Weiku Electronics, or other customers design a new product, they need to build a new production line for the product, and these production lines often have no ready-made equipment available, so new equipment needs to be designed for production.

At the same time, Weiku Industry is also an important leader in the field of intelligent factories in China. They created the first dark factory in China. In the field of intelligent production, relying on the industrial robot technology provided by Zhiyun Group, Weiku Industry's technical reserves are very strong, and they are truly at the world's top level. To a certain extent, Weiku Industry's intelligent factory technology level can even eliminate workers in more than half of the processes...

It’s just that all of Wecoo Industrial’s factories are located in China, and in order to protect employment and other factors, Wecoo Industrial cannot apply these intelligent factories on a large scale… If it dares to use them, Wecoo Industrial will have to lay off at least 1.5 million employees.

If these intelligent production lines are promoted and sold to other labor-intensive manufacturers in the country... then it's all over. It's hard to say whether Weiku Industry can make money with these intelligent production lines.

But Xu Shenxue will definitely be hung on the street lamp!

Once this damn thing is widely used, it will bring about a huge wave of unemployment for tens of millions of people, and those who lose their jobs will be disadvantaged workers with low education and low income.

If something like this were to happen, Xu Shenxue would be punished even if he was the richest man on Earth...

Furthermore, when one has achieved Xu Shenxue’s level in business, it doesn’t really matter whether one makes money or not. What he pursues are more intangible things, among which social responsibility is what he values ​​more.

Over the past decade, under the leadership of Zhiyun Group, the management and technical R&D personnel of many domestic technology companies have gone through many difficulties and fought hard abroad. Only then have they been able to bring back so many industries from abroad and create so many seemingly reliable jobs...

Every job here embodies the hard work of many people in the country, and some people even paid the price of blood for it...Galaxy Security and the security companies under the hostile consortium fight every few days, not just to protect Xu Shenxue's personal wealth.

Now if you ask him to destroy the jobs of tens of millions of people, it is impossible, because it goes against his basic bottom line in running a business and being a person. From this, we can know that Xu Shenxue has become somewhat idealistic.

Therefore, Xu Shenxue personally decided that these intelligent production lines should not be used until there are drastic changes in international market competition, such as when the cost of foreign products is significantly lower than that of domestic products; when there are no other large-scale alternative industries in China to absorb employment; and when repetitive labor-intensive industries such as electronic OEM do not encounter huge difficulties in recruiting workers.

Research and experiments are fine to maintain technological progress, but it cannot be used on a large scale right now!

Even if these smart factories are more efficient and have lower costs, they cannot be used!

Not only do they not use it themselves, they also do not supply it to others. At the same time, the technology must also be kept confidential to avoid leakage.

The reason why they do not use the equipment themselves or sell it to other domestic factories is to avoid a huge wave of unemployment; the reason why they do not sell it to foreign countries is to prevent domestic manufacturers from getting these equipment and then reducing costs and competing with domestic companies.

So we just cut it off and don’t let anyone use it!
Therefore, ordinary people outside the industry, and even people in the industry, do not know that Weiku Industrial has already developed very advanced intelligent production technology that can be used on a large scale and at a low cost.

Moreover, this intelligent production line is not only suitable for the consumer electronics industry. With slight changes, it can also be applied to other labor-intensive industries, greatly saving a large number of manpower processes... The experimental factory over at Weiku Industrial has proved that this set of intelligent production lines built with artificial intelligence technology can cut the number of workers by more than 90 percent on the basis of the existing advanced technology automated production lines.

With further optimization, the number of employees may even be reduced by a few percentage points.

If we could cut the number of workers by a few percentage points, that would be a great thing!
But cutting more than 90 percent of the workers at one go is not a good thing.

Many times, it doesn’t mean that technologically advanced things are necessarily good...especially new technologies that will cause huge changes, which require extreme caution.

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Looking at these domestic high-tech companies, quite a number of them have relationships with Xu Shenxue. This is not intentional on Xu Shenxue's part, but rather the three major areas of smart terminals, semiconductors and the Internet are highly related.

Xu Shenxue is engaged in high-tech industries centered on semiconductors, so it is inevitable that these connections will arise.

However, Xu Shenxue has never been a person who eats alone. As long as he can control the management rights and it is convenient for him to use the scientific research system, he generally will not hide the excess shares, but will release them to the outside world through financing, strategic investment and other means.

In recent years, Zhiyun Group has issued a number of targeted additional shares on multiple occasions and introduced investments from a number of domestic large-scale institutional funds!
Up to now, the shareholdings of Zhiyun Group held by various institutional funds have totaled to 20.5%, making it the second largest shareholder besides Xu Shenxue himself!
At the same time, there are also a large number of institutional funds in some supply chain companies related to Xu Shenxue, especially in some listed supply chain companies, institutional funds basically occupy the top five shareholders of circulating shares.

Today, these institutional funds will also be present in the listing process of Weiku Electronics.

In the previous strategic investment for listing, Weiku Electronics released a large number of shares to various strategic investment institutions, and institutional funds also actively participated in it.

In addition, supply chain companies, upstream and downstream companies, and even channel dealers have more or less participated in this pre-IPO strategic investment.

Because it is going to be listed in the domestic market, the listing process of Weiku Electronics is very cumbersome and lengthy. After launching the listing plan last year, it has only now completed many tasks and is about to enter the final listing stage.

At this time, Xu Shenxue also appeared at the headquarters of Wecoo Electronics Group and presided over the listing plan of Wecoo Electronics Group.

Participating in the meeting were not only the management of Weiku Electronics Group, but also representatives of strategic investors from all parties.

Although the listing of Weiku Electronics this time will not set off a wave of global capital feast like the listing of Zhiyun Group, it is also brewing huge benefits and bringing huge impacts.

The most important thing is that Weiku Electronics Group is listed in the country!
This title is actually very important!

Because this will be the first super large technology company to be listed on the domestic stock market!
The world's top 150 companies, the top 30 domestic companies, and the top three domestic high-tech companies are going public. This is destined to be a feast for domestic capital... Well, it is a feast for capital, not a feast for shareholders.

After all, whether ordinary investors make money or not has nothing to do with the financial performance of Wecoo Electronics... Even if Wecoo Electronics' stock continues to rise in the long term, nine out of ten ordinary investors who buy Wecoo Electronics will lose money!
The loss of money by ordinary domestic investors has actually nothing to do with the stock market or the performance of companies... No matter it is a bear market or a bull market, they are gambling with institutional funds, it would be a miracle if they don't lose.

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At the meeting, Xu Shenxue heard a brief report from Bai Qiwen, CEO of Vico Electronics Group: "According to the agreement we reached with various strategic investors, in the previous strategic investment, we released a total of 20% of common shares to strategic investors through increased financing, share transfers, cross-holdings, etc., and added 83 new shareholders, mainly supply chain and sales channel partners, as well as some institutional funds."

"Through this strategic investment, we have further improved the company's supply chain and sales channels, while ensuring the company's future healthy and stable operations, and also obtained a certain amount of cash flow."

"The domestic listing will be jointly managed by five investment banks, with an initial valuation of US$180 billion. Fifteen percent of the circulating shares will be released to the secondary market, and it is expected to raise US$27 billion."

"All preparations for the listing application have been completed. We have held several road shows in China before, and investors are very enthusiastic. At the same time, there is sufficient capital in China. We are very confident that we will not encounter any difficulties in raising funds this time. It is even possible that our market value will continue to rise after the official listing, and is expected to exceed the 200 billion US dollar mark!"

"All of this will be revealed at the beginning of next month, which is eight days later!"

Xu Shenxue nodded slightly: "I look forward to your successful listing!"

The listing of Vico Electronics Group in China is an important attempt by Xu Shenxue. He wants to see the reaction of the domestic capital market and whether it can support the listing of Vico Electronics Group as well as HaiLan Automobile, Yihai Technology and some companies that will be split off from Zhiyun Group in the future.

If this attempt is successful, he will gradually push his companies to be listed in China in the future. On the one hand, it is to raise more funds, and on the other hand, it is to share the dividends of corporate development with ordinary domestic investors.

If this attempt fails, Xu Shenxue will have to prepare some other backup plans.

But no matter what, the many companies under his control will always need to be listed one after another... In addition to financing and the benefits of corporate development, it is also because many managers and key technical personnel in a large number of companies under his control are eagerly waiting for their own listing to get rich overnight.

Back then, they said the company didn’t have much money, and in the early stages of development, they used stock options instead of high salaries, poached a large number of top talents, and said that they wanted the employees and the company to develop together and get rich together... You can’t just drag it on and not go public, that would be bullying!

Xu Shenxue would never do such a thing.

Furthermore, many of the things Xu Shenxue wants to do require a lot of money, and he also needs to cash out by selling or pledging shares after the company goes public.

Institutions hope that Wecoo Electronics Group will set an example. In order to facilitate Wecoo Electronics and other high-tech companies to list in China, they have even specially modified the rules to allow domestic companies to be listed on the domestic stock market and the Hong Kong stock market at the same time.

A large amount of domestic capital is waiting for investment with saliva swallowing, and ordinary investors are also looking forward to it... Everyone wants to invest in a high-tech company like WeCool Electronics that has strong earning ability, and it is also the third strongest high-tech company in the country.

Internal company management, technical staff, and even ordinary employees are looking forward to going public every day, waiting to get rich overnight;
A large number of supply chain and sales channel merchants also wanted to take advantage of the opportunity to make a fortune. They obtained part of WeCool Electronics' shares through cross-holdings, even paying money to buy shares and other various conditions. They are just waiting for WeCool Electronics to go public and make a fortune.

Even Xu Shenxue wanted to take the opportunity to cash out part of the funds and use them for technological research and development in other cutting-edge fields.

Therefore, the listing of Weiku Electronics Group is anticipated by many parties!
(End of this chapter)