ZHEJIANG HISUN BIOMATERIALS CO.LTD.(SH:688203) 市值风云·2025-07-30 10:09Core Viewpoint - Haizheng Biomaterials (688203.SH) has faced significant challenges after its initial public offering, with declining profits and increasing competition in the polylactic acid (PLA) market despite being a pioneer in the industry [3][4][7]. Financial Performance - The company reported its best profit in 2022, but subsequent years have seen a decline in net profit, with decreases of 7.41% in 2023, 18.47% in 2024, and a staggering 97.45% in Q1 2025 [4][6]. - Revenue for 2024 was 845 million, a year-on-year increase of 12.2%, but the gross margin fell to 12.71% in 2024, down 0.33 percentage points from 2023 [20][23]. Market Position and Competition - Haizheng Biomaterials is the first domestic and second global company to commercialize PLA production, holding a leading market share in China [7][47]. - The industry has seen rapid capacity expansion following domestic technological breakthroughs, leading to potential oversupply and reduced profitability [7][40][46]. Production Capacity and Delays - The company has faced delays in expanding its production capacity, with the initial plan for a 150,000-ton annual capacity project being adjusted to a phased implementation due to market conditions [24][26][27]. - As of the end of 2024, the first phase of the project was 70% complete, while the second phase was only 15% complete, with further delays anticipated [27]. Industry Dynamics - The PLA industry benefits from government support for biodegradable materials, with PLA projected to account for 37.1% of the bio-based materials market by 2024 [28][30]. - However, demand is primarily driven by policy rather than market forces, leading to challenges in adoption due to higher costs compared to traditional plastics [38][49]. Product Development - The company has developed various PLA grades tailored for different applications, including 3D printing, which saw a 185.67% increase in sales in 2024 [34][35]. - The revenue from modified PLA resins reached 187 million in 2024, indicating a focus on diversifying product offerings [35]. Future Outlook - Despite the promising market for biodegradable materials, the rapid expansion of production capacity across the industry poses a risk of oversupply, reminiscent of the solar energy sector's challenges [49].