Three years ago, the State-owned Assets Supervision and Administration Commission of Foshan City transferred 23.79% of the state-owned shares of Foshan Lighting to OSRAM, aiming to strengthen Foshan Lighting with the strong strength of the latter in the lighting industry. However, in the following years, while the major shareholder Osram continued to accelerate the development of its main business, Foshan Lighting's brand marketing efforts and regional market advantages are increasingly weakened. Recently, the semi-annual report released by Foshan Lighting showed that the company's net profit decreased by 45.73% year-on-year.
The semi-annual report released by Foshan Lighting recently showed that the company's main business income was 802 million yuan, up 16.54% year-on-year; total profit was 203 million yuan, down 41.68% year-on-year; net profit was 160 million yuan, down 45.73% year-on-year. Although the losses caused by Foshan Lighting's previous investment in the securities market inevitably dragged down the interim results, the slowdown in the growth of the main business in recent years has caused the industry to lose imagination of the growth of Foshan Lighting.
Brand and regional advantages are weakening
Foshan Lighting's publicly available data show that in 2005, its main revenue was 1.226 billion yuan, in 2006 it was 1.252 billion yuan, and in 2007 it was 1.496 billion yuan.
The compound growth rate of the electric light source industry is above 10%. Foshan Lighting's main income ten years ago is below the industry average compared to its current income. Insiders pointed out that in 2006, among the three listed lighting companies including Foshan Lighting, Zhejiang Sunshine and Shell Wright's net profit increased by 34.76% and 40.6%, respectively, while Foshan Lighting's main business was only 1.3%.
In the interview, the reporter learned that the gradual weakening of Foshan lighting brand awareness and market advantage is one of the most direct reasons for its main income growth slowdown.
It is understood that South China has always been the base of Foshan lighting. However, in the past two years, its dealers have reflected that Foshan Lighting needs to be further strengthened in terms of resources and product lines in the integrated industry. In Central China, the market advantage of Foshan Lighting is gradually disappearing. The person in charge of Nanchang Botai Lighting told the reporter that although the sales of Foshan lighting products distributed by itself were not bad, its market popularity and expansion efforts were not as good as before. A sales manager in the Jiangxi region also said that with the intensification of homogenization competition, the brand advantage of positioning Foshan lighting products in the middle and low grades has gradually disappeared, and the service enthusiasm of sales personnel is not as good as before. In the northwest and southwest regions, due to the remoteness and inconvenient management, Foshan Lighting's after-sales service to the end customers in the region is obviously lacking. At the same time, due to factors such as brand aging and price wars, some dealers and sales outlets began to withdraw. The survey shows that the structure of the Northeastern lighting market has changed significantly in recent years. The popularity of Zhejiang Sunshine in the Northeast has risen. At present, in Dalian, Foshan Lighting has only one general agent.
What role does OSRAM play?
This was the case after Osram entered the Foshan lighting. A few years ago, Foshan Lighting also played brand advertisements on Phoenix Satellite TV. In Nanjing, where I am, I often see advertisements on buses, but I can't see them in these two years. On the contrary, the advertisement of its major shareholder Osram is quite a lot. A securities analyst who has long tracked research lighting companies frankly stated that this contrast is obvious. Lighting products are low-tech thresholds that affect the audience primarily through brands. After entering Foshan Lighting, Osram has been unclear about its positioning. The weakening of Foshan Lighting's brand marketing has made people feel that its major shareholder Osram has the suspicion of freezing the brand.
As early as June 2005, the Foshan SASAC announced that it had withdrawn from Foshan Lighting and transferred the 23.99% of the company's national shares to Osram Prosperity Holdings Co., Ltd. and Hong Kong Prosperity Lighting Equipment Co., Ltd., which means that Germany Osram officially entered Foshan Lighting. Foshan Lighting will be handed over to Osram, and the Foshan SASAC aims to strengthen Foshan Lighting with the strength of Osram in the lighting industry. However, in the past three years, the development of Foshan lighting has gone from bad to worse.
When the Foshan SASAC or the major shareholder, the fund company pointed out that although Foshan Lighting's cash flow has always been sufficient, the main business investment is too conservative. After Osram entered the country, this situation has not changed. Subsequently, these funds were not used to develop the main business, but they were put into the securities market. This has the consistent business philosophy of Foshan Lighting. The insiders were puzzled by this, and they also caused a huge loss of 117 million yuan for Foshan Lighting.
In fact, energy-saving lighting is an industry strongly supported by China, with large capacity and space. In the more than ten years of listing in the domestic A-share market, Foshan Lighting only raised funds for four times, raising a total of 1.286 billion yuan to investors, but accumulating a cash dividend of more than 1.5 billion yuan to investors, far exceeding the funds raised by them. However, after Osram entered the company, Foshan Lighting not only lost the title of dividend winner, cash cow, but also lost imagination in the industry.
Foshan lighting strength is still
After the equity transfer, we did not pay much attention to Foshan Lighting, but we also saw that its main growth rate is not fast. I personally feel that their strength is still there, and the cash flow is still quite large. Zeng Xianxi, deputy director of the Foshan Municipal State-owned Assets and Investment Commission, the former major shareholder of Foshan Lighting, said.
In fact, Foshan Lighting is also saving itself. Due to the loss of investment in the securities market, Foshan Lighting has all the shares purchased by the company after the release of the quarterly report, indicating that it has abandoned its strategy of investing in the secondary market and turned to the main business such as energy-saving lamps.
Lin Shuhui, director of Foshan Lighting, said that the country is now pushing for energy conservation and emission reduction, and this is the company's strength. Foshan Lighting won the bid for all five varieties of energy-saving lamps, fluorescent lamps and high-pressure sodium lamps, with a quantity of about 7.4 million, and the price is close to the retail price of the company. Lin believes that this is a good opportunity for Foshan Lighting to launch the brand, and will increase the production of energy-saving lamps in the future.
Re-establishing the main business is the new positioning of Foshan Lighting. At present, there are more than 1,400 enterprises in the national lighting industry. The decline in gross profit margin will force the enterprises with poor production efficiency to exit the market. If Foshan Lighting can seize the opportunity, integrate resources and optimize the allocation in the industry, it is entirely possible to achieve scale advantage. And the substantial increase in scale benefits. Compared with Foshan Lighting's total output of nearly 300 million, 7.4 million is not a big deal, but it helps to expand channels and brand promotion. Previously, in these two aspects, it was precisely the weakness of Foshan Lighting.
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