Is the company's employee strategic allocation asset management plan highly profitable?

The company where the family member works is a bearing enterprise. The company has completed the listing guidance and inquiry stages. In February of this year, it was selected for on-site inspection. If all goes smoothly, it is estimated to complete the GEM listing in the first half of this year. Currently, an employee strategic allocation plan product has been launched for core management, with a minimum establishment scale of 10 million yuan. After the stock is listed, there will be a 12-month lock-up period, followed by weekly open periods during which investors can apply for exit operations.
The available information includes the following items:

1. Company Overview: It is one of the largest comprehensive bearing manufacturers in China, ranking fourth in domestic revenue, first in wind power bearings. From 2022 to the first half of 2025, revenue is projected to be 3.342 billion to 4.441 billion, 4.675 billion, and 2.821 billion (first half). Gross profit margins for the same period are 17.42%-19.91%-18.04%-21.96%. Net profit attributable to shareholders for 2022-2025 first half are -67 million (mixed reform), -231 million, -251 million, and -257 million. The company’s debt ratio is 80.74%, with interest-bearing debt of 4.344 billion. It is a representative of specialized and refined manufacturing, with strong policy support for the industry.

2. Capital Allocation Options:

• 1 million participation in the strategic allocation plan, with up to 100% position in strategic stocks.
• 400,000 participation, with up to 80% position in strategic stocks, and the remaining 20% managed through cash management plans.

3. Product Fees: Management fee 0.5% per year, custody fee 0.01% per transaction, VAT 3.2%, audit fee 6,000-10,000 per product, liquidation audit fee 6,000-10,000 per product, selling commission 0.1%, stamp duty 0.05% of transaction amount.

4. Investment Threshold: Core management + at least two years of investment experience + family financial net assets of no less than 3 million yuan (excluding real estate) / family financial assets of no less than 5 million yuan (excluding real estate).

The above is basic information about the product.

Risks include:

1. The estimated P/E ratio at issuance for this bearing company is about 28-35 times, while the industry average is about 20-25 times, posing a risk of overvaluation.

2. If the market environment is poor after listing, there is a risk of share price decline after the one-year lock-up period.

3. Investment failure and allocation issues: If the issuer’s issuance is unsuccessful, the strategic allocation asset management plan cannot participate in the strategic allocation. If the asset management plan only receives partial allocation of the targeted stocks, the manager has the right to force exit investors’ holdings based on allocation results and proportionate to their share of the plan. Investors may face the risk of being unable to participate in the plan with their initial investment amount. In cases where the manager opts for forced exit, the net asset value of the investor’s holdings should not be less than the minimum participation amount, and all investors will share the same exit ratio. This may result in some funds being unable to fully exit, and investors facing the risk of partial or no full exit of their allocated funds.

What do you think about the potential of this employee strategic allocation asset management plan? Is it worth participating? Tips and rewards are welcome.