CIGOO Technology Co., Ltd. is a leading company in the field of low-temperature heating and heat not burn products in China. On February 1, 2021, the shareholder company Yunnan Henggang Technology Co., Ltd. and Shanghai Lvxin Electronic Technology Co., Ltd. agreed to a friendly discussion. With a capital increase of 60 million yuan, CIGOO’s registered capital will be increased from the original 40 million yuan to 100 million yuan.
This capital increase provides sufficient capital support for the company’s rapid development, supports Siveco’s continuous deep cultivation of the heat not burn products industry, strengthens CIGOO’s comprehensive competitiveness, builds a complete intellectual property system, expands business scale, and improves customer service capabilities to achieve strategic upgrades.
At the same time, the company will also take this to improve its R&D capabilities and management level, shape a better R&D and management team, provide better guarantees for achieving speed-up and efficiency-enhancing development, and continue to promote the healthy development of the non-smoke, low-temperature, heat-not-burn products industry.
Industry situation: The heat-not-burn products (HNB) market continues to improve
The world tobacco giant Philip Morris International launched a new heat-not-burn cigarette device IQOS, which has been a great success in the international market. The IQOS cartridges matched with it have increased by 44.2% year-on-year to 59.7 billion in 2019, with annual sales of approximately US$5.6 billion. .
In 2019, the number of IQOS users rapidly increased to 13.6 million, and by the end of the third quarter of 2020, IQOS users reached 16.4 million, of which about 11.7 million had quit smoking and continued to use IQOS, maintaining a conversion rate of about 70% for traditional smokers. High level.
After two years of rigorous evaluation of more than 2 million pages of documents, on April 30, 2019, the US Food and Drug Administration announced that it had authorized Philip Morris (PMI) to sell new tobacco products in the US market for IQOS “Tobacco heating system” considers the product “suitable for protecting public health.”
Tests have shown that the content of harmful components in HNB smoke is reduced by more than 90% compared to traditional cigarettes.
On July 7, 2020, it was officially approved for sale as a modified risk tobacco product (MRTP), and it was marketed in the United States as a harm reduction product. The FDA official recognition of low-temperature heating and non-burning representative products as a harm reduction product have great positive demonstration significance and will promote the rapid development of such harm reduction products.
The HNB industry is currently in a trend of rapid development. According to a survey report by the authoritative institution Grandview Research, the global market for low-temperature heat not burn is expected to grow rapidly from US$7.3 billion in 2019 to US$68.3 billion in 2027 at a compound growth rate of 32.8%.
The domestic HNB industry is currently growing rapidly, and all China Tobacco Industrial companies and non-tobacco private enterprises are actively promoting the layout of HNB products.
Capital increase background: CIGOO development history
CIGOO Technology has developed rapidly in the field of non-tobacco low-temperature heat-not-burn since its establishment more than one year ago. It has established a low-temperature heat-not-combustion product production platform with independent intellectual property rights throughout the entire industry chain. At present, production capacity and product quality control are in Industry leader.
CIGOO, its HNB brand, continues to grow its market share and has gained high recognition from the market and consumers, and continues to develop rapidly with the continuous expansion of the low-temperature heat-not-burn product market.
As of the end of 2020, CIGOO has 51 patents, of which:
11 global invention patents;
17 China invention patents;
4 international PCT patent applications,
19 utility model patents.
CIGOO’s core patent cluster represented by “a one-piece molded heat-not-burn product and its preparation method” has been applied for more than 10 Chinaally, the United States, Japan, South Korea, the European Union, Hong Kong, Macao, Taiwan, etc. Countries and regions have applied for patent protection.
CIGOO’s particulate fuming and integrated low-temperature heating non-combustion products are the first products of this type released at home and abroad. The relevant patents are currently the earliest filing time, the widest scope of protection, and the patent clusters covering the most countries and regions.
CIGOO Technology has established a complete independent patent system for particle smoke and integrated low-temperature heating, which is different from Philip Morris International’s thin-film IQOS products, and is constantly improving and expanding the scope of patent protection in the field of low-temperature heating and non-combustion.
At the same time, CIGOO Technology has a number of senior new tobacco scientific research experts: CIGOO co-founder and technology leader Shen Jingxuan, senior engineer, expert who enjoys the special allowance of the Yunnan Provincial Government (tobacco engineering), and was awarded the Yunling Industrial Technology Leading Talent and Technology in Yunnan Province Innovative talents, with many years of experience in the development of traditional tobacco and new tobacco technology research and development products.
The technical team has several senior engineers, perfumers, and product designers, with strong scientific and technological strength, and devotes itself to developing low-temperature heating non-combustion products. The technical team is industry-leading in basic research, product development, and standard formulation.
The CIGOO technical team adheres to the R&D concept of innovation-driven, pursuit of excellence, and quality first, focusing on new tobacco products, intensifying innovation, meeting consumer needs, and developing more low-temperature heat-not-burn products for end-users.
The core technical advantages mainly include:
The product molding method and structure are completely different from IQOS products, building a strong intellectual property protection system
Do not use tobacco materials and device restricted by the China tobacco monopoly law
Friendly smoking device compatibility, matching most electric heating smoking device
CIGOO Technology, as the main body of implementation for both shareholders to develop in the field of low-temperature heating and non-combustion products, has excellent product quality, good market share and repurchase rate. This capital increase will provide CIGOO in terms of technology research and development, intellectual property protection and channel system construction. Providing capital guarantee will help enrich product types and expand markets, help CIGOO occupy the leading position in the industry, and continue to maintain a rapid growth trend.