Nanjie E-commerce (002127.SZ) Analysis of Sustainability of Brand Licensing Model and Inventory Turnover Rate

Based on existing data, I will conduct an in-depth analysis of the sustainability of Nanjie E-commerce’s brand licensing model and inventory turnover rate.

Nanjie E-commerce, whose core brand is ‘Nanjiren’, is an e-commerce enterprise focusing on brand licensing. The company adopts a light-asset operation model, charging brand licensing fees and service fees by authorizing its brand to suppliers and distributors, without directly participating in product production and sales [0].

• Market Value: 7900 million USD
• Current Stock Price: 3.22 USD
• Price-to-Earnings Ratio (P/E): -31.66 times (loss state)
• Return on Equity (ROE): -5.93%
• Net Profit Margin: -8.43%
• Current Ratio:5.24 (strong short-term solvency)

The company does not need to bear production and inventory pressure, and its operating costs are low. The current ratio reaches 5.24, indicating the company has sufficient funds and no short-term debt repayment pressure [0].

The Nanjiren brand has accumulated certain popularity and consumer awareness in the mid-to-low-end consumer goods market after years of operation.

• 2025 Q3 latest quarterly revenue was 637 million USD, a significant decline compared to Q2 [0]
• 2024 full-year revenue was 952 million USD, a decrease from the previous period [0]
• Stock price dropped by 32.21% in the past year, 34.42% in three years, and 70.96% in five years [0]
• The company is in a loss state with a net profit margin of -8.43% [0]

Financial statement analysis shows the company adopts aggressive accounting policies, with a low depreciation/capital expenditure ratio, and reported earnings may have limited upside potential [0].

E-commerce platform competition is fierce, brand licensing model has low barriers to entry, and homogeneous competition is severe.

Excessive licensing may lead to a decline in brand tone and increased difficulty in quality control.

Nanjie E-commerce adopts a brand licensing model, which theoretically does not hold inventory directly, so the traditional inventory turnover indicator is of limited applicability to it. However, its operational efficiency can be evaluated from the following perspectives:

As a light-asset company, its main assets should be accounts receivable from brand licensing, so it is necessary to pay attention to the efficiency of account recovery.

Reflects the efficiency of the company’s use of assets to generate revenue. Nanjie E-commerce’s indicator may be low because its assets are light.

The latest data shows the company’s free cash flow is -179 million USD, which is in a net outflow state, and the operating cash creation capacity is questionable [0].

Indicator	Evaluation	Explanation
Revenue Growth	Decline	2025 quarterly revenue shows a downward trend
Profitability	Loss	Net profit margin -8.43%, ROE is negative
Cash Flow	Deteriorating	Free cash flow continues to be negative
Stock Price Performance	Weak	Drop of over 30% in the past year

• Adequate liquidity (current ratio 5.24)
• Brand awareness in specific markets
• Light-asset model reduces inventory risk

• Core financial indicators have deteriorated across the board
• Continuous losses without signs of improvement
• Long-term stock price decline reflects insufficient market confidence
• Aggressive accounting policies increase financial risks

1. If revenue cannot stabilize and rebound, the company may face continuous operating pressure
2. The brand licensing model is easy to imitate, and the competitive moat is not deep enough
3. Aggressive accounting treatment may hide the real financial situation
4. Strict supervision in the e-commerce industry may affect the business model

Nanjie E-commerce’s brand licensing model faces sustainability challenges. Although light-asset operation reduces some risks, the continuously deteriorating financial performance and loss state indicate that the company needs to re-examine its strategic direction. If it cannot improve profitability and cash flow, there is significant uncertainty about the long-term sustainability of its business model.

In view of the company’s current loss state, negative ROE, and continuous outflow of free cash flow, it is recommended that investors remain cautious and pay attention to the company’s subsequent business transformation and financial improvement progress [0].

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[0] Jinling API - Company Overview and Financial Analysis Data of Nanjie E-commerce (002127.SZ)