HK IPO subscription: BOLDTEN IPO analysis and application plan
Breton Technology Co., Ltd. is a China-based provider of electric construction machinery, specializing in the design, development, and commercialization of autonomous electric construction machinery, along with intelligent operation services. According to CIC data, the company became one of the top players in China's new-energy wide-body dump trucks and loaders in 2024, with market shares of 18.3% and 3.8%, ranking third and seventh respectively. Since 2022, the company has achieved rapid growth in electric wide-body dump trucks and electric loaders, with compound annual growth rates of 128.1% and 17.5%.
Breton's technological advantages include efficient charging circuit design, dual-motor systems, and remote/autonomous driving technology, significantly enhancing product intelligence, safety, and efficiency. The company actively participates in setting key standards for China's new-energy construction machinery and was awarded the title of "Specialized and Sophisticated Little Giant" by the MIIT.
Assuming an issue price of HK$18.0 per share (without over-allotment), the estimated net proceeds are approximately HK$147.8 million, allocated as follows:
1. R&D (40%, ~HK$59.1 million):
New product development (e.g., higher-capacity dump trucks, remote autonomous operation technology).
Core tech upgrades (powertrain, electronic architecture).
2. Capacity expansion (40%, ~HK$59.1 million):
New factories in Lanxi, Zhejiang (5,000 electric loaders/year) and Xiangtan, Hunan (2,000 wide-body dump trucks/year).
Automated production equipment procurement.
3. Sales network & branding (10%, ~HK$14.8 million):
Expand domestic dealer network to 70-80 outlets with regional service centers.
4. Working capital (10%, ~HK$14.8 million): For daily operations.
IPO Details & Lottery Odds:
Global offering: 13M shares (200 shares/lot). Currently 5.2x oversubscribed. This "mini-IPO" will likely trigger 30% clawback, with 9,750 lots each for Group A/B. Estimated 10k-20k applicants, ~30% first-lot win rate. Apply 15 lots for one guaranteed allocation.
If using average allocation, first-lot win rate drops to ~5% (50 lots needed for one allocation).
Financials:
Revenue:2022: RMB360M → 2023: RMB464M → 2024: RMB635M.
Gross profit:2022: RMB8.17M → 2023: RMB9.28M → 2024: RMB36.84M.
Net loss:2022: -RMB178M → 2023: -RMB229M → 2024: -RMB274M.
Pre-IPO Investors & Cornerstones:
Completed 4 funding rounds pre-IPO. Series C+ (March 2023) raised RMB954M at RMB5.25B valuation (~HK$5.65B), cost basis RMB14.31/share (14.41% discount to IPO price), 12-month lockup.
2 cornerstone investors subscribed HK$63.5M (26.97% of offering), 9-month lockup.
Sponsors:
Joint sponsors: CICC & CMB International. CICC as stabilizing agent. CICC's recent 5 sponsored IPOs all closed green. CMB International's 2 co-sponsored deals with CICC had no broken IPOs (just low win rates). CICC's last 6 projects: 2 dipped in gray market but all closed green on debut.
Analysis:
Breton is China's only pure-play new-energy construction machinery maker, ranking #3 in wide-body dump trucks (18.3% share) and #7 in loaders (3.8% share) in 2024. Shipments grew from 59 to 307 units (dump trucks) and 326 to 450 units (loaders) during 2022-2024 (CAGR: 128.1% and 17.5%).
92.7% revenue from dump trucks (2024: RMB365M, 57.4%) and loaders (RMB224M, 35.3%). Average selling prices: dump trucks ↑ from RMB1.29M to RMB1.44M; loaders ↓ from RMB621k to RMB581k.
Dump trucks drive gross profit growth while other product lines bleed. Receivables ballooned to RMB555M in 2024. Pre-IPO investors had a redemption clause if the company failed to list by Dec 2025—now resolved.
China's new-energy construction machinery market (RMB79.7B in 2024, 29.2% CAGR) may reach RMB176B by 2029 (17.2% CAGR). Breton competes with traditional giants like XCMG, Liugong, and Zoomlion in loaders, and Yutong/Tongli in dump trucks.
Peer Tongli (NEEQ: 834599) has RMB5.66B dump truck revenue (92.21% of total). Breton's comparable segment revenue is just RMB400M—hard to justify its HK$6.83B valuation. Even with "new-energy premium," this smells like hype.
Post-Invictus Biosciences, IPO frenzy persists. But this one's a pass—overpriced despite tiny float (HK$171M after cornerstone). Only consider if: (1) <15x oversubscribed (no clawback), or (2) >100x oversubscription.
Action:
Pass.
$BRETON(01333.HK)
Disclaimer:Investments carry risks. This is not financial advice. DYOR.
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