FHM(SZ:300613) Zhi Tong Cai Jing·2025-11-04 07:02Core Insights - Shanghai Fuhangwei Electronics is set to complete its "A+H" dual listing on the Hong Kong Stock Exchange, positioning itself as a leader in the global smart vision processing chip market, with a projected first-place revenue ranking in 2024 [1][3] - Despite its market leadership, the company's financial data reveals a concerning trend of declining revenue and sharply reduced net profits, with a nearly 98% drop in net profit in the first half of 2025 compared to the previous year [1][5] - The company operates under a "fabless" model, focusing on integrated circuit design and sales while outsourcing manufacturing, which allows for concentrated resources on technological innovation [1][2] Business Overview - Fuhangwei's product architecture covers the complete visual processing chain, from image signal acquisition to video storage and management, providing a robust full-stack solution [2] - The company's core product lines include smart video, contributing 67.3% of total revenue in 2024, smart IoT, and smart mobility, with products used in various applications such as security cameras and automotive systems [2] Market Opportunities - The AI wave presents significant transformation opportunities for the visual chip industry, with the global AI SoC market expected to grow from $43.8 billion in 2025 to $109 billion by 2029, at a CAGR of 25.6% [3] - Fuhangwei's "AI for All" strategy aims to leverage technological innovation to provide high-performance, cost-effective AI visual ICs, with plans to expand its R&D team and AI product offerings [3] Financial Challenges - The company's financial performance has shown a downward trend, with total revenue declining from 2.11 billion RMB in 2022 to 1.79 billion RMB in 2024, and a further 14.1% decrease in the first half of 2025 [4] - Net profit has also significantly decreased from 378 million RMB in 2022 to 23.2 million RMB in 2024, with a drastic drop to 1.8 million RMB in the first half of 2025, attributed to reduced procurement from its largest customer and intense price competition [5] Customer and Supply Chain Risks - Fuhangwei's business model is highly exposed to customer concentration risks, with the top five customers contributing 88.4% of revenue in 2024, and the largest customer accounting for 66.7% of total sales [6] - The supply chain is similarly concentrated, with the top five suppliers representing 80.6% of total procurement, making the company vulnerable to disruptions from key suppliers [6] Conclusion - Fuhangwei's strong market position and technological capabilities are its core strengths, but it faces significant challenges including declining profitability, customer concentration, and escalating market competition [7] - The upcoming IPO is seen as a critical opportunity for the company to secure funding for strategic transformation, balancing the potential of AI-driven market growth against its internal operational challenges [7]