Core Viewpoint - The IPO process of Xiamen Hengkang New Materials Technology Co., Ltd. has been postponed by the Shanghai Stock Exchange, marking it as the first IPO project this year to face such a delay, raising concerns about the company's compliance and legitimacy due to controversies surrounding its former second-largest shareholder [1][8]. Company Overview - Hengkang New Materials is an innovative company focused on the research, production, and sales of key materials for integrated circuits, particularly advanced photolithography materials and precursors, filling several domestic gaps in the industry [4][6]. Financial Performance - The company reported revenues of 322 million yuan, 368 million yuan, and 548 million yuan for the years 2022, 2023, and 2024, respectively, with net profits of 99.73 million yuan, 89.76 million yuan, and 96.91 million yuan during the same period [4][5]. - The projected revenue for 2024 is 547.94 million yuan, reflecting a 49.01% increase from 2023, while net profit is expected to reach 96.91 million yuan, a 7.96% increase [5]. Customer Concentration - The company has a high customer concentration, with the top five clients contributing over 99% of its revenue during the reporting period, compared to an industry average of around 35% [6][7]. - Sales to the largest customer accounted for 72.35%, 66.47%, and 64.07% of total sales in the respective years, indicating a potential vulnerability in pricing power and future revenue stability [6]. Capital Expenditure and Funding Needs - Hengkang New Materials aims to raise 1.007 billion yuan through its IPO to expand production capacity, particularly for integrated circuit precursors and advanced materials, despite currently having a low capacity utilization rate [7][8]. - The company anticipates a funding gap of 1.628 billion yuan over the next three years, even if the IPO is successful, raising concerns about its ongoing operational viability [7]. Production Capacity - The capacity utilization rates for various products in 2024 were reported as follows: SOC (57.42%), BARC (21.43%), KrF (17.55%), i-Line (46.67%), and TEOS (46.47%), indicating significant idle capacity [7]. - The company expects utilization rates to improve significantly by mid-2025, with projections of 100.49% for SOC, 52.79% for BARC, and 46.4% for KrF [7].