Guizhou Zhenhua E-chem (SH:688707) Xin Lang Zheng Quan·2025-10-31 03:20Core Viewpoint - Zhenhua New Materials, a significant player in the lithium-ion battery cathode materials sector, faces challenges in revenue and profit due to market competition and structural changes in demand [2][6]. Group 1: Company Overview - Zhenhua New Materials was established on April 26, 2004, and listed on the Shanghai Stock Exchange on September 14, 2021, with its registered and office address in Guiyang, Guizhou Province [1]. - The company specializes in the research, production, and sales of lithium-ion battery cathode materials, holding a competitive position in the market [1]. Group 2: Financial Performance - For Q3 2025, Zhenhua New Materials reported revenue of 1.067 billion yuan, ranking 38th out of 44 in the industry, significantly lower than the top competitors [2]. - The main business segment, cathode materials, generated 700 million yuan, accounting for 98.17% of total revenue, while other segments contributed 13.07 million yuan [2]. - The net profit for the same period was -333 million yuan, placing the company 41st in the industry, with a notable gap from leading firms [2]. Group 3: Financial Ratios - As of Q3 2025, the company's debt-to-asset ratio was 40.13%, lower than the industry average of 51.96%, indicating relatively lower debt pressure [3]. - The gross profit margin was -15.18%, a decline from -11.82% year-on-year, and significantly below the industry average of 10.89%, highlighting challenges in profitability [3]. Group 4: Management and Shareholder Structure - The chairman, Hou Qiaokun, has extensive experience, having served in the company since May 2012, with a 2024 salary of 557,600 yuan, down from 2.1298 million yuan in 2023 [4]. - The major shareholder is China Zhenhua Electronics Group Co., Ltd., with the actual controller being China Electronics Corporation [4]. Group 5: Shareholder Dynamics - As of September 30, 2025, the number of A-share shareholders increased by 4.89% to 16,900, while the average number of shares held per shareholder decreased by 4.66% [5]. Group 6: Market Outlook - According to Huajin Securities, Zhenhua New Materials' performance in the first half of 2025 was under pressure due to market structure changes and increased competition, leading to reduced pricing power [6]. - Despite challenges, the company has seen growth in high-nickel and ultra-high-nickel cathode materials, which now account for 50% of revenue, and has made progress in new product certifications [6]. - The forecast for net profit from 2025 to 2027 is -87 million yuan, 120 million yuan, and 290 million yuan, respectively, with corresponding EPS figures indicating a potential recovery [6].