(Yicai Global) July 10 -- Zhang Xiaoquan, a famed Chinese scissors, shears and knife brand that dates back over 350 years, has filed to list on the Shenzhen Stock Exchange’s Nasdaq-like ChiNext stock market as it seeks to raise cash to modernize its operations and gain a firmer hold in the high-end market.

The Hangzhou-based firm plans to raise CNY455 million (USD64.9 million). It will spend CNY354 million to build a smart manufacturing center in Yangjiang, Guangdong province and use the rest for the digital transformation of its management structure and as working capital, according to the prospectus documents filed on July 7.

If it succeeds, it will be China’s first scissor and knife maker to go public.

The scissor maker is facing intense competition from domestic and overseas brands. China’s high-quality knife market is dominated by overseas brands as local manufacturers fall short in this area, analysts said. Zhang Xiaoquan has also been involved in many trademark disputes with other firms who claim to be making the same time-honored brand, they added.

The company, which was set up in 2008 despite a three-century old trademark, sells around 99 percent of its goods domestically and under 1 percent overseas. Hangzhou Zhang Xiaoquan Group holds a 65 percent stake in the firm.

Zhang Xiaoquan posted net profit of CNY72 million (USD10.3 million) last year. It has reported an average annual growth rate of more than 20 percent for the last three years, with operating revenue of CNY341 million (USD48.6 million), CNY410 million and CNY484 million in operating revenue in 2017, 2018 and 2019, according to the prospectus.

Yangjiang in southern Guangdong province is well known for its scissor and knife production. In 2018 the sector had an output value of CNY55 billion (USD7.9 billion), accounting for 70 percent of the national total and 85 percent of all exports.

Editor: Kim Taylor