Core Viewpoint - Zhejiang Jinhua New Materials Co., Ltd. (referred to as "Jinhua New Materials") is set to undergo an IPO review on July 4 at the Beijing Stock Exchange, aiming to raise a total of 768 million yuan [2] Financial Performance - Jinhua New Materials' revenue is projected to grow from 994 million yuan in 2022 to 1.239 billion yuan in 2024, with Q1 2025 revenue at 282 million yuan, reflecting a 9.98% year-on-year decline [3][4] - The company's net profit after deducting non-recurring gains and losses is expected to rise from 78.42 million yuan in 2022 to 206 million yuan in 2024, but Q1 2025 shows a 16.89% decline year-on-year [3][4] - Accounts receivable have increased alongside revenue, with the company's asset-liability ratio decreasing from 44.45% in 2022 to 36.26% in 2024, still above the industry average of 35.23% [4][6] Debt and Liquidity - Jinhua New Materials' liquidity ratios are below industry averages, with a current ratio rising from 1.57 in 2022 to 2.12 in 2024, but a net cash ratio of only 0.42 indicates weak cash flow coverage [4] - The company has faced scrutiny from the Beijing Stock Exchange regarding its debt indicators, which are lower than comparable companies, raising concerns about liquidity risk [4][6] Related Party Transactions - A significant portion of Jinhua New Materials' procurement is from its controlling shareholder, Juhua Group, with related party purchases accounting for 38.08% to 28.93% of total procurement from 2022 to 2024 [6][8] - The company has been questioned about selling prices to related parties being lower than those to non-related parties, with average prices for certain products being 1%-4% lower [8][9] Production Capacity and Market Conditions - Despite a declining market for its core product, silane crosslinking agents, which saw a price drop of 35.4% over three years, Jinhua New Materials plans to invest 507 million yuan to increase production capacity by 30,000 tons [3][10] - The company's production capacity utilization has decreased from 96.19% to 76.15% over the same period, raising questions about the feasibility of expanding capacity under current market conditions [10][11] Customer and Supplier Dynamics - The top five customers accounted for 46.41% to 50.13% of total revenue during the reporting period, with Juhua Group being a significant related party [6] - Jinhua New Materials has established business relationships with potential customers for new products, but the projected sales volume may not fully absorb the new production capacity [11][12]

Core Viewpoint - Zhejiang Jinhua New Materials Co., Ltd. is applying for listing on the Beijing Stock Exchange, focusing on the development, production, and sales of ketoxime products, establishing a green circular industry chain [1][3]. Group 1: Company Background - The company has developed a green circular industry chain consisting of ketoxime/aliphatic oxime, oxime silane, and hydroxylamine series products [1]. - The chairman, Lei Jun, previously held positions at Juhua Co., Ltd., including general manager and deputy general manager [1][3]. Group 2: Related Party Transactions - The company has significant related party transactions with Juhua Group, with procurement amounts of 32,965.04 million, 29,940.15 million, and 26,620.75 million yuan over the past three years, accounting for 38.28%, 35.65%, and 28.38% of total procurement respectively [3][4]. - In 2023 and 2024, the company plans to procure raw materials from Juhua Group amounting to 81,949,053.10 yuan and 65,417,991.14 yuan respectively [4]. Group 3: Raw Material Supply and Production Capacity - Juhua Group sold ketoxime materials to Jinhua New Materials for 16,276.9 million yuan and 13,365.89 million yuan in 2023 and 2024, respectively, which exceeds the procurement amounts disclosed by Jinhua [5]. - Jinhua New Materials is expanding its own production capacity for ketoxime, with a planned production start in June 2024, aiming to reduce reliance on external procurement [5]. Group 4: Market Conditions and Product Pricing - The utilization rate of the company's core product, silane crosslinking agent, decreased from 96.19% in 2023 to 76.15% in 2024, with no explanation provided in the prospectus [7]. - The company has been reducing the sales prices of silane crosslinking agents due to a downturn in downstream market demand, particularly in the construction and photovoltaic sectors [8].

Core Viewpoint - Zhejiang Jinhua New Materials Co., Ltd. (Jinhua New Materials) is preparing for its listing on the Beijing Stock Exchange, focusing on the production and sales of fine chemical products, particularly oxime series chemicals. The company has shown revenue growth in recent years, but its profitability remains a concern due to a significant drop in gross margin and net profit compared to 2021 [2][4][5]. Financial Performance - Jinhua New Materials reported revenues of 9.94 billion, 11.15 billion, and 12.39 billion for 2022, 2023, and 2024 respectively, with net profits of 0.78 billion, 1.73 billion, and 2.06 billion [4][5]. - The company’s revenue in 2021 was 11.53 billion, indicating a decline in 2022 by 1.59 billion. The net profit in 2021 was 2.45 billion, which is more than three times the profit in 2022 [4][5]. - Gross margin dropped from 34.12% in 2021 to 17.72% in 2022, rebounding to 27.65% in 2023, but still below the 2021 level [5][6]. Industry Comparison - Jinhua New Materials' gross margin has consistently been lower than its peers. In 2022, the average gross margin for comparable companies was 34.59%, while Jinhua's was only 17.72% [6][7]. - The gross margin for Jinhua's main product, silane crosslinking agents, was 16.21% in 2022, significantly lower than the average of 34.88% for similar products from competitors [8][9]. Related Procurement and Financial Concerns - The company has faced scrutiny regarding the fairness of its related-party procurement, particularly concerning the pricing of raw materials [3][10]. - The proportion of receivables settled through bank acceptance bills increased significantly in 2024, raising concerns about the authenticity of the company's financial performance [3][12]. - Jinhua New Materials' cash flow from operating activities has shown significant volatility, with a notable decline of 68.74% in 2024 compared to 2023 [10][12]. Conclusion - Jinhua New Materials is experiencing a recovery in revenue but faces challenges in profitability and cash flow management. The reliance on bank acceptance bills for settlements and the low gross margins compared to industry peers raise questions about the sustainability of its financial performance [15].