Ge Long Hui·2025-06-03 09:44Core Viewpoint - Jiangyin Huaxin Precision Technology Co., Ltd. (Huaxin Precision) is set to undergo its IPO review on June 6, 2025, with a focus on its precision stamping core products primarily used in the automotive and industrial sectors, including electric vehicles [1][2]. Company Overview - Huaxin Precision, based in Jiangyin, Wuxi, has a history dating back to 2002 and has undergone multiple capital changes, with the current actual controllers being Guo Zhengping and his daughters, holding a combined 68.97% voting rights [4][6]. - The company has established a strong client base, including major players like BYD, BMW Group, and Huichuan Technology [1][9]. Financial Performance - The company reported revenues of approximately CNY 1.192 billion, CNY 1.189 billion, and CNY 1.421 billion for the years 2022, 2023, and 2024, respectively, with net profits of CNY 114 million, CNY 156 million, and CNY 150 million [12]. - The gross profit margins for the same years were 16.89%, 21.86%, and 20.43%, indicating fluctuations in profitability [12][13]. Product Segmentation - Over 94% of Huaxin Precision's revenue comes from precision stamping cores, with more than 50% derived from electric vehicle drive motor cores, which have been increasing in contribution [9][10]. - The company also produces precision stamping molds, although this segment contributes a smaller portion of revenue [9]. Market Dynamics - The Chinese electric vehicle market has seen significant growth, with sales increasing from 6.887 million units in 2022 to 12.866 million units in 2024, representing a compound annual growth rate of 36.68% [16]. - Huaxin Precision has capitalized on this growth by increasing its client base and securing contracts with major automotive manufacturers [16]. Production Capacity and Utilization - The production capacity for electric vehicle drive motor cores has seen a decline in utilization from 84.98% in 2022 to 60.97% in 2024, raising concerns about future sales if market growth does not meet expectations [20][22]. - The company plans to raise approximately CNY 712 million through its IPO to expand its production capacity and enhance its research and development capabilities [18]. Client Dependency - A significant portion of Huaxin Precision's revenue is tied to its relationship with BMW, with contributions from this client accounting for 0.93%, 26.83%, and 25.33% of total revenue over the reporting periods [17]. - The company faces risks if it cannot secure ongoing orders from existing clients or new projects, which could impact sales [17].