(CapitalWatch, Aug. 15, New York) YanGuFang International Group Co. Ltd., a Chinese grain producer with U.S. expansion plans, has filed for an initial public offering in New York worth up to $23 million.

YanGuFang is an offshore holding company operating through a variable interest entity (VIE). Its subsidiary, with headquarters in Shanghai, makes oat and grain products and positions itself as a healthy food company.

The company's VIEs operate two production facilities; YanGuFang said it expects to put all eight production lines to use by the year's end. That would mean capacity improvement from 13,720 tons per year to 33,348 tons per year.

YanGuFang sells oat-based food products through its own app, as well as China's major online shopping platforms Tmall, operated by Alibaba (NYSE: BABA; HKEX: 9988), JD.com (Nasdaq: JD; HKEX: 9618), and Pinduoduo (Nasdaq: PDD). It also directly sells products offline to its customers and wholesalers

The company has been profitable. For the six months through December 2021, YanGuFang booked $18.8 million in revenue on income of $3.9 million. For the full year ended June 2021, the company reported a 24% year-over-year increase in revenue, at $29.8 million. Net income increased 62% to $10.5 million, according to the prospectus.

YanGuFang has been present in the U.S. since February 2021, when it launched a subsidiary, YGF Oats, in Texas, and registered with the FDA. The company noted that it expects to start sales in the U.S. in the second half of 2022.

The proceeds from the offering, YanGuFang said in the SEC filing, will be used for the construction of additional production facilities, purchase and upgrade of its equipment, and R&D. A portion of the capital will go towards global expansion, primarily to North America, South East Asia and Japan.

YanGuFang has applied to become publicly traded on the Nasdaq Capital Market under the ticker symbol "YGF." EF Hutton, a Benchmark Investments division, is underwriting the IPO.