On August 29, Sanxiong Aurora (300625) published its interim financial report for 2017. During the reporting period, the company generated operating income of 951 million yuan, representing a year-on-year increase of 28.36%. Among this, 787 million yuan came from LED lighting products, up 46.84% year-on-year, while traditional lighting products accounted for 132 million yuan, a year-on-year decline of 24.54%. The total profit reached 103 million yuan, increasing by 36.93% year-on-year; the net profit attributable to listed company shareholders was 88.741 million yuan, a year-on-year rise of 34.76%.
Under the steady macroeconomic conditions and intensified competition within the LED lighting industry, Sanxiong Aurora's management, guided by the board of directors, capitalized on the company's listing as an opportunity. By leveraging its dominant position in the commercial lighting sector and brand influence, the company successfully expanded its marketing channels and enhanced market responsiveness. This strategic effort led to impressive growth in both revenue and net profit during the first half of the year.
Building a Brand to Secure a First-Mover Advantage in Market Competition
Since the inception of the "Sanxiong·Aurora" brand, the company has dedicated itself to researching, developing, producing, and promoting high-quality, energy-efficient lighting products. Providing customers with comprehensive lighting solutions and professional services has been a hallmark of their commitment. Over the years, Sanxiong Aurora has evolved into one of the most comprehensive lighting brands in China.
As one of the earliest domestic companies to pioneer green energy-saving lighting products, the "Sanxiong·Aurora" trademark has been recognized as a well-known trademark in China. With the rapid expansion of the LED lighting market, the company has consistently introduced high-quality LED lighting products across various applications, earning widespread acclaim.
The company's core management team brings over 20 years of experience in the lighting industry. With an extensive sales network, robust R&D capabilities, comprehensive manufacturing infrastructure, and rigorous quality control systems, the brand enjoys a stellar reputation in the industry. Its popularity and market influence continue to strengthen amid the ongoing market consolidation.
Through relentless efforts, Sanxiong Aurora has built a solid reputation for product quality and brand image within the lighting industry, particularly in commercial and engineering lighting. The company’s superior product quality and technical expertise have earned widespread recognition from industry users, giving it a significant competitive edge in the fiercely competitive market.
Adjusting Organizational Structure to Tap into the Home Lighting Market
To vigorously develop the home lighting segment, Sanxiong Aurora restructured its marketing system during the reporting period. An independent household products division was established to tailor and build a retail channel system specific to the home lighting industry. To cater to consumer preferences for diverse product designs, the company increased investments in design and adjusted its procurement and production processes to better meet household product demands.
Traditionally, the company’s market has focused on professional lighting like commercial and tooling lighting. Projects in these fields typically require professional lighting designers and impose strict standards on lighting effects, product quality stability, and comprehensive technical services. The company’s comprehensive capabilities in product quality and technical services have been thoroughly tested and widely acknowledged in this professional lighting market.
However, since professional lighting primarily involves institutional purchases, there is limited interaction with individual consumers. Consequently, ordinary consumers often lack awareness of the company’s products and brand in the general home lighting market.
To enhance brand visibility among regular consumers, Sanxiong Aurora updated its VI system and implemented stricter regulations and image enhancements for sales terminal stores. These efforts aim to provide high-quality products and professional services to a broader consumer base.
Expanding Channels and Exploring Market Potential
Currently, Sanxiong Aurora’s professional lighting sales channels are predominantly located in first- and second-tier cities, with high demands for technical expertise and swift service response. To further expand its market reach, reinforce its leadership in the professional lighting segment, and offer more specialized and timely services, the company intensified its physical marketing network下沉 efforts. During the reporting period, the company established dealerships in second- and third-tier cities and set up sales terminals.
During the reporting period, the company established 331 new professional terminals through dealers, significantly enhancing the sales and service system in the professional market. Although home lighting constitutes a smaller portion of the company’s revenue structure, it holds substantial growth potential. To further develop this segment, the company increased brand promotion in non-professional markets. This strategy aimed to familiarize more consumers with the company’s products and brand while building a broader retail network system to offer consumers more convenient offline purchasing options.
Simultaneously, the company established 377 new home lighting products through distributors, greatly expanding the coverage of its household product line and driving rapid growth in household product sales.
According to the report, the sales revenue of Sanxiong Aurora’s home lighting products surged by 70.6% in the first half of the year. The company’s e-commerce self-operated channels primarily operate on Tmall and JD.com. During the reporting period, the company bolstered its e-commerce team and resource investments, accelerating the development of new products tailored to e-commerce consumption patterns. The company optimized pre- and post-e-commerce resources, offering consumers a wide array of high-quality products and a seamless shopping experience. Additionally, the company opened up more e-commerce channels to serve a larger consumer base.
It is worth noting that, with approval from the China Securities Regulatory Commission, Sanxiong Aurora shares were listed on the Growth Enterprise Market of the Shenzhen Stock Exchange on March 17, 2017. The net proceeds raised from the initial public offering amounted to 1.266 billion yuan. The company plans to invest in projects such as LED green lighting expansion, LED intelligent lighting production base construction, R&D center upgrades, physical marketing network sinking and enhancement, O2O e-commerce platform construction, and cross-border e-commerce overseas market expansion.
Implementing Automation to Enhance Production Efficiency
Sanxiong Aurora boasts a comprehensive manufacturing capacity and has developed a unique control system in production processes, process control, and product quality control. This ensures the quality, technical parameters, delivery dates, and other stringent requirements of professional lighting fixtures are met, providing strong support to the sales market.
Improving efficiency and quality remains the perpetual theme in production and manufacturing. During the reporting period, the company’s manufacturing bases enhanced production efficiency through automation line upgrades, acquisition of automated production equipment, optimization of production models, and process improvements. These efforts catered to the growing market demands.
Strengthening R&D Investment to Meet Market Needs
Professional lighting such as commercial and tooling lighting requires highly stringent technical parameters and quality stability. The company’s R&D department leverages its years of accumulated industry expertise and strengthens external resource integration with universities. Topics such as optics and optical engineering are actively pursued. When necessary, the R&D department also participates in the product design of key component suppliers in various ways to ensure product quality meets design standards.
Sometimes, professional lighting products need customization based on user needs, while household products require greater diversity in appearance. To cater to different market demands, Sanxiong Aurora has optimized and expanded its R&D team, continuously launching new products to meet varying market needs.
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