Sou Hu Cai Jing·2025-09-01 08:40Core Viewpoint - The article discusses the recent comments made by former CFO Xia Lian regarding Zhibao Zhixing's upcoming IPO, questioning the company's motives and management integrity, while highlighting its financial struggles and reliance on major shareholders Alibaba and SAIC Motor [1][2]. Company Structure and Financing - Zhibao Zhixing was established in 2015 with an initial registered capital of 1.064 billion RMB, primarily owned by a joint venture of Alibaba and SAIC [2]. - The company has not secured new financing in nearly two years, with a total of approximately 4.919 billion RMB raised over four rounds from various investors [2][3]. - Major financing sources include Alibaba and SAIC, contributing at least 2.713 billion RMB of the total raised [3]. Management and Governance - The board of directors and executives are predominantly from Alibaba and SAIC, with recent changes in leadership, including the appointment of Dai Wei as CEO [5][6]. - The former CEO, Zhang Chunhui, resigned in July 2022, and the current executive team includes several individuals with backgrounds in Alibaba and SAIC [6][7]. Financial Performance - Zhibao Zhixing has not achieved profitability, with revenues of 805 million RMB in 2022, 872 million RMB in 2023, and projected 824 million RMB in 2024 [8]. - The company’s gross margin has been declining, with core business margins dropping from 54.4% in 2022 to 37.6% in 2025 [14][15]. Revenue Sources and Client Base - The majority of Zhibao Zhixing's revenue comes from its core operating system solutions, accounting for over 83% of total revenue in recent years [8]. - The company has a significant reliance on related parties, with over 67% of total revenue generated from them over the past three years [12]. Accounts Receivable and Cash Flow - Zhibao Zhixing has a high level of accounts receivable, with over 40% of its revenue classified as "white bills" in recent years, indicating potential cash flow issues [19]. - The company has experienced negative operating cash flow, with outflows of 585 million RMB in 2022 and 417 million RMB in 2023 [21]. Investment and Borrowing Activities - Despite ongoing losses, Zhibao Zhixing has engaged in significant investment activities, including purchasing financial assets, while also increasing its borrowing [21][22]. - The total borrowings have risen from 239 million RMB in 2022 to 806 million RMB in 2025, indicating a growing reliance on debt financing [22].