Article/Pan Helin, columnist of Sina Financial Opinion Leader (WeChat official account kopleader)
letv I'm afraid there will be no more "suffocating dreams", only "suffocating", and it is only a matter of time. If a gentleman does not build a dangerous wall, relevant retail investors must not play games of foolishness.
On November 1, LeEco's rise was close to the limit, but it may be a knife edge phenomenon. Recently, LeTV's share price has changed. LeTV said in its announcement that there are no plans or plans for controlling shareholders to increase their holdings of the company's shares, investment and financing, asset integration and other solutions to the company's debt crisis. In addition to the capital problem, LeEco's high-quality assets have been controlled by Rongchuang, and the business most likely to turn around is no longer in hand. Last month, Rongchuang took over the assets of Lerong Zhixin and LeTV Pictures held by LeTV Holdings at a total auction base price of 770 million yuan.
Once upon a time, LeEco was also a powerful player in the industry, but today it is really a sad situation. The author believes that from the current point of view, Rongchuang and Sun Hongbin have made preparations, and people expect Jia Yueting to make a comeback with the help of FF. Therefore, LeEco may no longer have "suffocating dreams", only "suffocating", and it is only a matter of time. If a gentleman does not build a dangerous wall, relevant retail investors must not play games of foolishness.
LeTV itself has fallen into losses and is unable to recover. On the evening of October 29, LeTV disclosed its third quarter report that the revenue of the first three quarters was 1.348 billion yuan, down 77.88% year on year, and the net profit loss was 1.489 billion yuan. Most importantly, LeEco's high-quality assets have basically been stripped away, and its poor business can no longer have the opportunity to save itself. In fact, LeEco cannot turn around with the help of relevant businesses even if it does not spin off. Let's take a look at the essence of LeEco's crisis.
Many people only know that the LeEco crisis comes from the shortage of funds, but they still need to understand the whole process of the crisis. The LeEco crisis can be roughly divided into three stages:
The first stage: at the end of 2016, LeTV's cash flow was tight for the first time, which was just hearsay at this time. However, in theory, it is understandable that the layout of the "ecological" strategy led to the capital shortage. Our idealist Jia Yueting also publicly said that the company's capital chain was tight due to the rapid pace of development, The crisis at this time was also temporarily alleviated by Jia's many students at CKGSB on November 15 by investing 600 million dollars in LeTV companies.
Phase II: At the beginning of 2017, Sun Hongbin, known as China's good fellow, entered the company. Rongchuang China acquired 8.61% equity of LeEco with 6.04 billion yuan, 15% equity of LeEco Cinema with 1.05 billion yuan, and 33.5% equity of LeEco Zhixin with 7.95 billion yuan and capital increase through its subsidiaries.
The third stage: Jia Yueting resigned as chairman of LeEco on July 6, 2017. Sun Hongbin took over Jia Yueting as chairman of LeEco on July 21. During this period, LeTV companies experienced large-scale layoffs and arrears of suppliers' accounts, including China Merchants Bank Several banks, including LeEco, applied for property preservation and requested the court to freeze the assets of LeEco.
From the perspective of the whole process, LeEco is just due to its crazy expansion. It needs funds urgently and has no reliable basic business to support it, but the reason is not so simple. The data shows that since 2012, LeTV has generated considerable cash flow from operations. The net cash flow has increased from 10619.999 to 87570.19 in 2015, and the growth rate has doubled several times in recent years. However, from the perspective of LeEco as a whole, this money is a drop in the bucket.
What's more, for the sake of ecological development, LeTV's related party transactions have soared from 1.35% to 30% since 2012. LeTV, which had good prospects for development, has actually become the stepping stone of other industries. Moreover, LeTV's financial report has changed extremely gratifying relying on related party transactions, This has laid a good foundation for the stability of the stock price in the secondary market and subsequent financing. According to the data, LeTV raised more than 6 billion yuan from 2014 to 2016 through its private placement based on the profits and revenue generated.
However, when dealing with related parties, all prosper and all suffer losses. As other businesses are only in the initial stage, it is difficult to bring lasting and stable benefits to the company, and the money spinner LeTV will one day be sucked and withered by these symbionts. LeTV, as the source of financing for LeTV, has finally failed. LeTV Zhixin, LeTV Mobile, LeTV Film, LeTV Sports, Netwine, LeTV Holdings, etc., which are supported by LeTV, have also lost their vitality due to the lack of supply. Maybe some people are still dreaming that Mr. Jia can return with the FF smart car, but as far as the current situation is concerned, the hope is somewhat dim, It can even be said that it is almost completely broken.
I wrote articles in public long ago. Don't worry about Rongchuang and Sun Hongbin being dug by Jia Yueting. With such a large investment, Sun Hongbin is not interested in "fellow townsmen". He must have made plans early, and should be prepared for the worst. The two most promising industries of LeTV are LeTV Zhixin and LeTV Cinema, which are now firmly controlled by Sun Hongbin, and Tencent, Ali Jingdong also threw olive branches at him. It can be said that Sun Hongbin left his own way from the very beginning. It is not excluded that a large amount of LeEco land will also be controlled by the controlling shareholders.
Therefore, only retail investors will be trapped. Recently, LeEco's stock price is still "demon". Maybe it is ZH Shares Second, I don't know how many retail investors will be trapped. Confucius said that if a gentleman does not build a dangerous wall, small and medium-sized investors must remain vigilant and never be greedy.
In fact, Jia Yueting, the management, Rongchuang and other investors were all profit grabbers in the whole LeTV event. They didn't mean what LeTV would do in the future, or at least would be able to save themselves in the big buildings. However, a large number of small and medium-sized investors in the secondary market were not so lucky. In front of Jia's PPT, the dead horse was also regarded as a live horse. This is probably the most worth thinking about. If we can improve the relevant system, it will bring changes to the investment philosophy of small and medium-sized investors, and it will also be a valuable legacy left by LeEco.
(The author of this article introduces: famous young economist, famous financial commentator)
