Core Viewpoint - Del Technology, a fluorochemical company, is facing significant challenges as it prepares for its IPO, with declining profits and a reduced fundraising target, indicating a critical juncture in its business transformation [1][3][22]. Financial Performance - The company's net profit attributable to shareholders has declined for three consecutive years, from 303 million yuan in 2021 to 119 million yuan in 2023, with only 64.01 million yuan in the first half of 2024 [3][5]. - The adjusted net profit after excluding non-recurring gains and losses dropped from 184 million yuan in 2022 to 86 million yuan in 2024, a decline of over 50% [5]. - The total assets increased from 5.36 billion yuan in 2022 to 6.86 billion yuan in 2024, while the total revenue showed a decrease from 1.70 billion yuan in 2022 to 1.69 billion yuan in 2024 [6][20]. IPO and Fundraising - The IPO fundraising target has been significantly reduced from 3 billion yuan to 1.945 billion yuan, a decrease of 35% [4][9]. - The number of fundraising projects has been cut from seven to three, with all projects related to new energy materials removed [4][9]. Business Transformation - The company is shifting its focus towards semiconductor materials, with revenue from this segment exceeding 50% in the first half of 2024 [7]. - The reliance on lithium hexafluorophosphate, which previously accounted for 38% of revenue, has diminished, with its contribution dropping to 4.28% in 2024 [5][7]. Research and Development - The company's R&D expenditure ratio has been low, ranging from 1.84% to 2.24% from 2022 to 2024, significantly below the industry average of 5.11% to 5.46% [12][15]. - The company claims that the low R&D demand in its fluorochemical materials business justifies the reduced investment, but this raises concerns about its long-term technological competitiveness [12][15]. Governance Issues - The three actual controllers of the company hold only 35.06% of the shares, which may lead to control risks post-IPO due to further dilution of voting rights [16][17]. - Historical issues with shareholding representation have raised concerns about the clarity of ownership, particularly with recent shareholding changes before the IPO application [17][18]. Financial Anomalies - In 2023, despite a 16.52% decline in revenue, accounts receivable increased by 49.83%, raising questions about the reasonableness of revenue recognition [19]. - The gross profit margin has decreased from 29.75% in 2022 to 16.04% in 2024, indicating weakened profitability [19][20]. Market Outlook - The company’s IPO journey has faced multiple challenges, with its status shifting from "suspended" to "inquiry" after financial updates [22]. - The semiconductor materials market is expected to grow at an annual rate of over 15%, but the company’s performance remains highly dependent on the semiconductor industry cycle [8][24].

Group 1 - The report emphasizes the importance of supply shocks and is optimistic about the import substitution of new materials in the basic chemical industry [1][4] - The chemical raw materials and products industry achieved revenue and profit of 2.95 trillion and 115 billion respectively in the first four months of 2025, with a year-on-year growth of 3.1% and a profit decline of 4.4% [12][19] - The chemical industry profit margin has dropped to a historical low of 3.9% as of mid-2025 [12][52] Group 2 - The report indicates that external demand may slow down in 2025, with oil prices under downward pressure due to OPEC+ increasing production [35][39] - Domestic demand is expected to stabilize and recover due to a series of incremental policies, with GDP growth projected at around 5% for the year [43][44] - The report highlights that the chemical raw materials and products industry fixed asset investment growth has significantly slowed, with the operating rate dropping to 73.5% in Q1 2025 [24][26] Group 3 - The report identifies potential investment opportunities in the chemical industry, particularly in supply-restricted sectors such as phosphate and potassium fertilizers, and in high-concentration sub-industries like viscose staple fiber and vitamins [48][49] - The report recommends focusing on companies involved in new materials, especially those related to import substitution, such as AI high-speed resins and fluorinated liquids [48][49] - The report suggests that the valuation of the basic chemical sector is at a historical low, with the overall PE and PB ratios at 22.29 times and 1.82 times respectively as of June 16, 2025 [52][53] Group 4 - The viscose staple fiber industry has not seen new capacity additions for several years, leading to a high concentration and potential for profit recovery [60][67] - The polyester industrial yarn sector is expected to see a reversal in supply and demand dynamics, with no new capacity planned and increasing demand from the automotive sector [69][79] - The modified plastics sector is projected to grow due to the ongoing replacement policies in domestic appliances and the rise of new demands from robotics and low-altitude applications [81][90] Group 5 - The refrigerant market is expected to grow steadily, supported by the ongoing replacement policies and increasing demand from the automotive sector [92][93] - The report highlights the potential for the civil explosives industry to see demand exceed expectations due to high resource prices and ongoing large-scale infrastructure projects [95][96] - The phosphate chemical sector is projected to maintain high profitability due to sustained high prices and tight supply-demand conditions [99][100]