“Investors Network” Wu Wei

After a lapse of four years, the re-hosted Beijing Auto Show became a stage for the biggest players in the auto industry to compete for traffic. From the “oldest car model”, the cardinal in red, to Lei Jun, who won the new title of “factory manager,” they all shined brightly at this auto show. The fierce traffic dispute at the Beijing Auto Show, on the one hand, marked the great development of the domestic automobile industry, and on the other hand, it also reflected the anxiety of car companies. Although Jishi 01 also showcased many things and new ideas at the Beijing Auto Show, Jishi Auto, founded by Shi Tou Technology (688169.SH) founder Chang Jing, received far less attention than the Xiaomi SU7 and Ideal Auto (02015.HK). Instead, it is Stone Technology itself. Supported by strong growth, the company's stock price has continued to rise recently.

Speaking of which, Stone Technology is also extremely related to Xiaomi. Stone Technology was founded by natural people such as Chang Jing and Ding Di in July 2014, and the company released its first product in September 2016. Just a few months after the establishment of Stone Technology, Tianjin Jinmi, a subsidiary of Xiaomi, participated in Stone Technology's capital increase. After the investment in Xiaomi, the Xiaomi Group also became the main customer of Stone Technology. More than 90% of the company's revenue in 2016 and 2017 was provided by the Xiaomi Group. With the support of Xiaomi, Stone Technology completed its first launch in February 2020. After going public, the market value of Stone Technology was once close to 100 billion dollars, and Chang Jing also had a net worth of over 10 billion dollars when he was less than 40 years old.

However, after Xiaomi gradually dropped out of Stone Technology's shareholder list by reducing its holdings, Changjing's Jishi Auto has now met Xiaomi on the hot track of new energy vehicles. But compared to the Xiaomi Group with a market capitalization of 400 billion dollars, can Stone Technology with a market value of 50 billion support Chang Jing's dream of building cars?

Origin: Xiaomi supports Stone Technology

In the tech industry full of bigwigs, Chang Jing, born in 1982, is undoubtedly a junior. As a “school bully,” he obtained his bachelor's degree and master's degree in computer science at South China University of Technology; after graduating in 2006, Chang Jing worked as a department leader in Internet technology companies such as Proud World, Microsoft, Tencent, and Baidu. In 2014, after being a senior manager at Baidu for 3 years, Chang Jing co-funded the establishment of Stone Technology with natural persons such as Ding Di, Mao Guohua, and Wu Zhen. Chang Jing was the actual controller of the company.

When Stone Technology was founded, the company received the support of a “noble person”. This “noble person” is Jinmi, a subsidiary of the Xiaomi Group. In December 2014, Stone Technology reviewed and passed a resolution to increase the registered capital. Among them, Tianjin Jinmi, a subsidiary of the Xiaomi Group, increased its investment by 92,700 yuan. After the capital increase, Tianjin Jinmi held 30% of Stone Technology's investment. According to estimates in the prospectus, in March 2016, when Stone Technology carried out its second equity transfer, the company's overall valuation was only around 1.2 billion yuan.

In 2015, Tianjin Jinmi transferred part of Stone Technology's investment to Lhasa Shunying. In 2019, Lhasa Shunying withdrew from the list of Stone Technology shareholders through capital cuts. Since then, Shunwei, which is also controlled by Xiaomi, has taken over Lhasa Shunying's investment amount and became the second largest shareholder of Stone Technology through a capital increase.

In addition to increasing capital for Stone Technology, the Xiaomi Group is also using practical actions to support the development of Stone Technology. Prior to the launch of Stone Technology, the company's main products were the custom brand “Mijia Smart Vacuum Cleaner” for Xiaomi, as well as its own brands “Stone Intelligent Vacuum Cleaner” and “Xiaowa Intelligent Vacuum Cleaner”.

According to the company's disclosure, in 2016 and 2017, the transaction volume between Shitou Technology and Xiaomi Group accounted for 100% and 90.36% of the company's total revenue, respectively. Even in 2019, the Xiaomi Group contributed 34.27% of the revenue to Stone Technology.

With the support of Xiaomi, in February 2020, Stone Technology successfully completed its initial launch on the Science and Technology Innovation Board, with an issue price of 271.12 yuan/share. After listing, the stock price once reached 1494.99 yuan/share, and the market value was close to 100 billion yuan.

It should be pointed out that in addition to investing in Stone Technology, the Xiaomi Group also invested in Chase Technology (Suzhou) Co., Ltd. (hereinafter referred to as “Chase Technology”), another robot vacuum cleaner company. According to Tianyan survey information, Tianjin Jinmi, Shunwei, and Hanxing Venture together hold 13.3% of Chase Technology's shares. Recently, Stone Technology and Chase Technology also filed lawsuits due to patent disputes.

Weak luck: Xiaomi shareholders are gradually reducing their holdings

However, soon after Stone Technology went public, the Xiaomi Group gradually drifted apart from Stone Technology. In 2019, the Xiaomi Group was also the largest customer of Stone Technology, providing it with 34.27% of revenue; in 2020, the Xiaomi Group retreated to the fourth largest customer, contributing 9.28% of revenue. By 2023, the total number of products sold by Shitou Technology to the Xiaomi Group was only 1.42 million yuan, accounting for a negligible share of the company's total revenue in the current period.

After losing the Xiaomi Group as an important customer, Stone Technology actively developed domestic and foreign market needs, and the company's revenue did not decline as a result. In 2020, Stone Technology's revenue was 4.53 billion yuan, an increase of 7.74% over 2019. By 2023, its revenue had reached 8.654 billion yuan, an increase of 91.04% over three years.

Meanwhile, soon after the ban on the company's initial share offering was lifted, 10 shareholders, including company executives Mao Guohua and Wu Zhen, including Shunwei and Tianjin Jinmi, began reducing their shares.

According to the annual report of Stone Technology, by the end of 2023, Tianjin Jinmi's holdings in Stone Technology had dropped from 8.89% after issuance to 4.49% at the end of 2023 through multiple holdings reduction. On April 19, 2024, Shunwei also sold 0.5% of Stone Technology's shares through an inquiry and transfer. After the transaction was completed, its shareholding also dropped to 4.91%.

The transaction price of this transfer was 323.66 yuan/share, and the total consideration for Shunwei's transaction was 213 million yuan. Compared with the company's share price of 380 yuan/share recently, the transfer price is about 15% off.

According to incomplete statistics, in February 2021, after Shunwei and Tianjin Jinmi first announced their intention to reduce their holdings of Stone Technology shares, Shunwei and Tianjin Jinmi reduced their holdings of Stone Technology by a total of nearly 4.2 billion yuan during the five holdings reduction process; the combined shareholding ratio of the two also dropped from 18.53% after issuance to 9.4% recently.

It should be pointed out that in February 2023, Chang Jing, the actual controller of Stone Technology, also announced a plan to reduce his holdings by no more than 2% of the company's total share capital shortly after the initial share ban was lifted. In September of that year, after the supervisory authorities strengthened supervision of actual controllers of listed companies to reduce their holdings, Changjing stopped reducing their holdings by 1% and promised not to reduce their holdings within the next three months; this time, Changjing realized 392 million yuan of shares.

Rendezvous: New energy vehicles “start a business for the second time”

Interestingly, the “second venture” of Chang Jing, the actual controller of Stone Technology, coincided with the “last time to start a business” by Xiaomi and Lei Jun, and both sides have set their sights on new energy vehicles.

According to industrial and commercial registration information, in February 2021, Chang Jing and Yan Feng, who have worked for SAIC Motor and Weimar, co-founded Luo Ke Intelligence (“Jishi Auto”). The company is headquartered in Shanghai, with Chang Jing as the chairman; Yan Feng as the CEO.

Also in March 2021, Lei Jun announced that “(building a car) will be (his) last major venture”.

According to Tianyan survey information, Luo Ke Smart received Series A financing from Gao Rong Venture Capital and Northern Lights Venture Capital in the year it was founded. At the time, the valuation was 240 million US dollars. Since then, Locke Smart has successively received investment from investors such as Tencent Investment, Sequoia China, and IDG Capital. By the time it completed Series E financing in February 2023, the company's valuation was close to 3 billion US dollars.

After receiving financing, Roke Smart actively promoted the delivery of its models. In August 2023, Shandong Weiqiao Venture Group (hereinafter referred to as “Weiqiao Group”) and Luo Ke Smart jointly announced the signing of a strategic cooperation agreement to cooperate in the production of Jishi Motors, and Beijing Automobile Manufacturing Co., Ltd. will be responsible for OEM production and implementation. On September 22, Weiqiao Group strategically invested 1 billion US dollars in Luo Ke Smart; on November 25, 2023, the Jishi 01 was fully launched before the delivery of the first batch of Xiaomi SU7 car owners in the country.

On the evening of April 23 this year, during the first online communication meeting with the founders held by Jishi Motor, Chang Jing said that the Jishi 01 integrates the three models of off-road SUVs, luxury MPVs, and versatile motorhomes, and has the diverse attributes of “one car as three cars”. According to the official website of Jishi Motor, the Jishi 01 currently has two models, a 7-seat version and a 6-seat version. The power has three models: pure electric priority, fuel priority, and hybrid oil and electricity. The basic sales price is 349,900 yuan and 359,900 yuan, respectively.

According to Jishi's official disclosure, as of the end of February this year, the Jishi 01 had produced a total of 2,586 vehicles, with a cumulative sales volume of 2,357 vehicles, of which the actual sales volume in January this year was 855 vehicles and the actual sales volume in February was 552 vehicles. In addition to deepening the domestic market, the company is also actively exploring the international market. As the first model of Jishi Auto, the Jishi 01 has many competitors, including the L8, which is also ideal for extended range medium to large SUVs; for pure electric SUVs, the Jishi 01 has more competitors. In the increasingly competitive domestic NEV market, there is a huge gap between the sales volume of the Jishi 01 and other “first movers” such as Wei Xiaoli, and it is still unknown whether it can break through in the future.

However, this time, I'm afraid Luo Ke's intelligence may not be helped once again by the Xiaomi family.

On the other hand, looking at Xiaomi, with the smooth release and successful delivery of its Xiaomi SU7, it also had a huge impact on the domestic automobile market, and various bosses went live to promote their products. According to the Passenger Federation, since 2024, prices of nearly 100 models, including Tesla and Ideal, have been reduced.

At this stage where competition is heating up and the industry is beginning to be reshuffled, can Chang Jing's dream of a car come true? (Produced by Thinking Finance) ■