The second round of questioning, independence and connected transactions continue to be asked.

Previously, the company said that after the production line segmentation, the raw materials purchased from related parties are mainly integrated circuit products. However, from January to September in 2021 and 2022, the unit price of some integrated circuit products purchased by the company from related parties was higher than that purchased from non-affiliated suppliers, and the average difference rate of 10 types of integrated circuit products was 8.34%, and the company did not fully explain the reasons for the differences.

The Shenzhen Stock Exchange requires explanation of the reasons for the purchase of the same type of products from related parties and non-related parties at the same time, and the reasons and reasonableness of the purchase price from related parties is higher than that from non-related parties.

The explanation given by the Company is that, on the one hand, the products purchased from Hikvision and its subsidiaries are all in accordance with the pricing rules of related party transactions uniformly formulated within Hikvision Group, that is, the mark-up is carried out on the basis of the reasonable cost of the relevant raw materials purchased by the related party, and the mark-up rate is referred to the transfer pricing data of the related party issued by the professional organization every year.

On the other hand, with the increase of procurement volume during the reporting period, the Company continued to negotiate price reduction with integrated circuit suppliers, and the purchase unit price of the above-mentioned types of integrated circuits decreased. In addition, the overall appreciation trend of RMB from the beginning of 2020 to the end of 2021, and the average unit price during the comparison period is also affected by exchange rate fluctuations.

1746-NI16I

The operating net cash flow is poor, and it is planned to raise 900 million yuan to supplement the flow

In the first round of inquiries, the matching problem between the cash flow fluctuation and the income statement and the balance sheet of Haikang Machine was grilled by the supervision, and the company made some explanations, but it was obviously difficult to convince. The second round of inquiries of the Shenzhen Stock Exchange requires clarification of enterprises with negative cash flow from operating activities, high asset-liability ratio and the effectiveness of relevant corresponding measures.

According to the declaration materials and the response to the first round of inquiries, the net cash flow generated by the company’s operating activities in each period of the reporting period was -138 million yuan, 103 million yuan, -325 million yuan and -398 million yuan, respectively, which fluctuated greatly, and was a net outflow except 2020.

The company’s response to the first round of inquiries explained that with the expansion of production and operation scale, the purchase of raw materials and product stock increased correspondingly, accounts receivable also increased, and there was a certain time difference between upstream and downstream payments and payment settlement, resulting in negative net cash flow of operating activities.

In addition, during each reporting period, the company’s asset-liability ratio was about 70-80%. In the first round of reply, the company explained that in the period of rapid business growth, the working capital needs are large, the company has a strong independent financing ability, and can gradually improve the asset-liability ratio under the premise of ensuring stable development.

However, at the end of September 2022, the company’s credit borrowings increased from 23.02 million yuan at the end of 2021 to 550 million yuan, and long-term borrowings at the end of September 2022 increased from 19 million yuan at the end of 2021 to 350 million yuan. By the end of 2022, the situation is similar.