Jiansu (Shanghai) Information Technology Co., Ltd IPO – Plain English Investor Guide

Hey there! Thinking about this IPO? Here’s what matters most, without the Wall Street jargon:

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1. What Does This Company Do?

They’re like “Amazon for factory supplies.” Jiansu helps small-to-medium factories in China buy plastics, chemicals, and raw materials through an app. Imagine a factory owner ordering 10 tons of plastic and tracking the shipment like you’d track an Uber Eats delivery.

Key Detail: The real business is Shanghai Jiansu (founded 2014). The company you’re investing in is a Cayman Islands shell created in 2023. Here’s the ownership chain:

• Cayman shell → Hong Kong subsidiary → Chinese subsidiary → 92.7% ownership of Shanghai Jiansu.
  Think of it like buying a movie ticket stub that controls most of the theater.

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2. How Do They Make Money?

They buy wholesale and sell retail – like a grocery store for factories. Their main costs are purchasing materials and sales taxes.

Growth Snapshot:

• Revenue: $552.5M (2024) vs. $489.4M (2023) – up 12.9%
• Profit: $2.1M profit in June 2024 vs. $0.6M loss in 2023
• Customers: 2,158 factories (up 27% in a year)

Red Flag: The Cayman company you’re investing in doesn’t make money directly. All profits come from Chinese subsidiaries. If China blocks money transfers overseas, shareholders could get nothing.

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3. What Will They Do With IPO Cash?

Three main goals:

1. Upgrade tech to manage inventory better
2. Expand in China’s chemical hubs (Southeast Asia later)
3. Pay off debt (exact debt numbers not provided)

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4. Top Risks to Know

Corporate Structure Jenga Tower:

• You own part of a Cayman shell dependent on dividends from China.
• China can block payments anytime. Currently, $0 moves between Cayman and China.

Dividend Jail:

• Chinese subsidiaries must keep 10% of profits yearly until reserves hit 50% of their value.
• The company hasn’t clarified when dividends might reach shareholders.

CEO Control:

• Founder Dejun Wang will own 21.5% post-IPO – enough to override most shareholder votes.

Delisting Time Bomb:

• New U.S. rules could kick JSKJ off Nasdaq in 2 years if China blocks financial audits.

Tech Embargo Risk:

• If partners end up on U.S. sanctions lists (like Huawei did), Jiansu could lose access to critical software.

Data Rules:

• Growing past 1 million users? They’ll need Chinese government approval to stay listed – a process they call “risky.”

Silent Updates:

• As an "emerging growth company," they only share audited financials once a year – no quarterly reports.

Unverified Growth Claims:

• Their market stats (“China’s plastic market will grow X%”) come from unverified third-party reports.

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5. Competitors

They’re the specialty store vs. Walmart:

• Smaller than Alibaba’s industrial arm but more focused on chemicals
• Better price-tracking tools than traditional suppliers

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6. Leadership

CEO Dejun Wang calls the shots with 21.5% post-IPO ownership. Team includes ex-factory managers and tech developers.

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7. Trading Details

• Symbol: JSKJ (Nasdaq)
• Price: Not yet announced (originally planned for Shanghai)
• Valuation: ~$700M if priced at top range (exact numbers pending)

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Bottom Line:

This is a high-risk bet on Chinese factories digitizing their supply chains.

Consider If:

• You’re comfortable with complex offshore structures
• You believe China won’t restrict profit flows overseas
• You can handle limited financial updates (annual reports only)

Think Twice If:

• You need transparency (CEO control, unverified market stats)
• You’re wary of geopolitical risks (U.S.-China tensions, sanctions)
• You prefer steady dividends (payouts are uncertain and locked for years)

Final Note: The company provided limited details on debt, exact pricing, and dividend timelines. Always ask: “Would I buy a used car with this little info?”

Stay sharp! 🧐