Core Viewpoint - The article discusses the unusual stock ownership changes at Zhejiang Lijichuang Storage as it approaches its IPO, particularly focusing on the exit of a state-owned enterprise shareholder just before the listing, raising concerns about the company's financial health and future prospects [1][3][11]. Group 1: Shareholder Exit - A state-owned enterprise, Tianyuan Zhicheng, which held 9.45% of the company's shares, sold its entire stake at a significant discount just two months before the IPO filing [3][5]. - The total transaction value for the share transfer was 1.17 billion RMB, reflecting a valuation of less than 1.3 billion RMB for the company, which is a sharp decline from nearly 2.9 billion RMB just a year prior [9][21]. - The exit of Tianyuan Zhicheng is interpreted as a negative signal regarding the company's future, suggesting a lack of confidence in its IPO prospects [11][24]. Group 2: Financial Performance - From 2020 to mid-2025, the company has accumulated losses of 542 million RMB, indicating ongoing financial struggles despite the potential recovery in the semiconductor industry [13][21]. - The company has been increasing its R&D expenditures, but the output in terms of core technology patents remains limited, with only 12 patents filed, most of which are recent [15][21]. - The shift in business focus from memory chips to memory modules has not improved profitability, as the gross margin for the memory module business has significantly declined from 11.1% in 2023 to 3.9% in the first half of 2025 [17][24]. Group 3: Cash Flow and Market Perception - The company has experienced a net cash outflow of 376 million RMB from operating activities from 2022 to mid-2025, with increasing accounts receivable raising concerns about collection risks [19][21]. - The exit of a major shareholder and the company's ongoing losses may hinder its ability to secure favorable valuations in the market, impacting future financing opportunities [24][26]. - The company aims to use the IPO to address funding shortages, but it must demonstrate clear performance and a viable path to profitability to gain market acceptance [26].

Core Viewpoint - Zhejiang Liji Storage Technology Co., Ltd. (Liji Storage) has submitted its prospectus to the Hong Kong Stock Exchange, aiming for an IPO despite facing significant financial challenges, including cumulative losses of 542 million yuan and ongoing negative operating cash flow [1][2]. Financial Performance - The company has reported fluctuating revenues from 2022 to the first half of 2025, with figures of 610 million yuan, 580 million yuan, 646 million yuan, and 412 million yuan respectively, indicating an unstable growth trend [2]. - Cumulative net losses reached 542 million yuan, with net losses of 139 million yuan in 2022, 244 million yuan in 2023, 109 million yuan in 2024, and 31.7 million yuan in the first half of 2025 [2][3]. Research and Development - Despite poor profitability, the company maintains a high level of investment in R&D, with expenditures of 74 million yuan, 77 million yuan, and 96 million yuan from 2022 to 2024, consistently exceeding 12% of revenue [4]. - As of the end of 2024, over 50% of the workforce is dedicated to R&D, focusing on advanced technologies such as WoW3D heterogeneous integration and custom 3D-IC stacking [4]. Cash Flow and Financial Health - The company has experienced negative cash flow from operating activities, totaling 376 million yuan, with a significant outflow of 119 million yuan in the first half of 2025, primarily due to rising accounts receivable and inventory impairment [4]. - Trade receivables surged to 155 million yuan by June 2025, a 237% increase from the end of 2022, raising concerns about credit loss rates [4]. Profitability and Revenue Structure - The gross margin improved from -2.1% in 2022 to 9.3% in 2024, reaching 10.2% in the first half of 2025, attributed to product structure optimization and rising chip prices [5]. - However, the net profit margin remained negative at -16.8% in 2024 and -12.1% in the first half of 2025, due to high R&D and management expenses [5]. - The company is shifting its business focus, reducing the share of memory chip business from over 88% to 53.3% by the first half of 2025, while memory module revenue surged to 40.1% of total revenue, growing 217% year-on-year [5]. Shareholder Dynamics - The exit of local state-owned enterprise Jinhua Tianyuan Smart City Investment Co., Ltd. before the IPO has raised concerns, as it sold its entire 9.45% stake for approximately 117 million yuan, significantly below previous valuations [6][7]. - This exit occurred just two months before the IPO, contrasting sharply with a nearly 2.9 billion yuan valuation from a recent funding round, indicating a potential lack of confidence in the company's future [7][8]. - The timing and pricing of this exit have led to speculation about the company's prospects, as strategic investors typically maintain long-term commitments unless significant concerns arise [8][9].

Core Viewpoint - Zhejiang Liji Storage Technology Co., Ltd. (Liji Storage) is attempting to go public on the Hong Kong Stock Exchange, focusing on the niche DRAM market, but faces significant financial challenges, including cumulative losses of 542 million RMB and negative operating cash flow [1][2]. Financial Performance - Liji Storage has reported fluctuating revenues from 610 million RMB in 2022 to an estimated 412 million RMB in the first half of 2025, with cumulative losses reaching 542 million RMB [2][3]. - The company has maintained high R&D expenditures, with amounts of 74 million RMB, 77 million RMB, and 96 million RMB from 2022 to 2024, consistently above 12% of revenue [4]. - Despite improvements in gross margin from -2.1% in 2022 to 10.2% in the first half of 2025, net profit margins remain negative at -16.8% for 2024 and -12.1% for the first half of 2025 [5][4]. Shareholder Dynamics - The exit of local state-owned enterprise Jinhua Tianyuan Smart City Investment Co., Ltd. before the IPO, selling its 9.45% stake for approximately 117 million RMB, raises concerns about Liji Storage's valuation and future prospects [6][7]. - The valuation at which Tianyuan exited represents a 55% discount compared to the company's previous financing round valuation of nearly 2.9 billion RMB in December 2023 [7][9]. - The timing and pricing of this exit have led to speculation regarding the company's future and the potential risks perceived by strategic investors [9][10].

Core Viewpoint - Zhejiang Liji Storage Technology Co., Ltd. (Liji Storage) is preparing for an IPO on the Hong Kong Stock Exchange, facing challenges in balancing scale expansion and stable profitability due to ongoing losses and low gross margins compared to industry averages [1][2]. Group 1: Company Background and Ownership Structure - Liji Storage was established in March 2020, with initial investments from Tianjin Haoxin and Longxin Zhongke, and has since integrated Zentel Japan to establish its core business [3][4]. - The company is controlled by Ying Wei through a multi-layered equity structure, with significant involvement from Dinghui Investment, which has raised market interest regarding its ownership adjustments [2][9]. - As of now, Liji Storage has 28 direct shareholders, with Hangzhou Dingyuan as the largest shareholder holding 22.67% [9]. Group 2: Financial Performance and Challenges - Liji Storage has reported continuous losses, with adjusted net losses narrowing from RMB 1.39 billion in 2022 to RMB 498.22 million in 2023, largely due to significant share-based payment expenses [20][21]. - The company’s revenue structure is shifting, with memory module sales increasing significantly, contributing to 40.1% of revenue in the first half of 2025, while core memory chip revenue is declining [20][22]. - The gross margin for memory chips remains higher than that of memory modules, indicating a strategic challenge in balancing growth and profitability [24]. Group 3: Market Position and Product Development - Liji Storage focuses on niche DRAM markets, with a total storage capacity growth from approximately 13.8 million GB in 2022 to about 34.2 million GB in 2024, reflecting a compound annual growth rate of 57.4% [19]. - The company relies heavily on external suppliers for core production processes, which increases material costs and impacts gross margins [15][17]. - Liji Storage has established itself as a key supplier for major domestic computer and server manufacturers, indicating a growing market presence [20].

Core Viewpoint - Zhejiang Liji Storage Technology Co., Ltd. (Liji Storage) has submitted its application to the Hong Kong Stock Exchange again, with a significant increase in revenue from memory modules and a decline in revenue from memory chips during the reporting period from 2022 to the first half of 2025 [1][5]. Financial Performance - Liji Storage's revenues for the years 2022, 2023, 2024, and the first half of 2025 were 610 million, 580 million, 646 million, and 412 million respectively, while the company has not achieved profitability, incurring losses of 139 million, 244 million, 109 million, and 49.82 million during the same periods, totaling approximately 542 million in losses [5]. - The inventory amount reached 149 million by the end of the first half of 2025, accounting for nearly 30% of the total assets of 525 million, which increased to 206 million by the end of the third quarter of 2025 [6]. Product Revenue Breakdown - The revenue share from memory chips decreased from 88.2% in 2022 to 53.3% in the first half of 2025, while the revenue share from memory modules increased from 0% to 40.1% during the same period [6]. - Most of the memory modules are based on third-party memory chips rather than the company's own products, as the company's self-developed memory chips are targeted at niche markets and have not yet entered the mainstream DRAM market [6]. Investment and Valuation - The Zhejiang Jinyi Tianyuan Smart City High-tech Industry Development Co., Ltd. (Tianyuan Smart City) invested a total of 100 million in Liji Storage in 2021 and 2022, but transferred all its shares at a price significantly below market value in March 2025, valuing Liji Storage at less than 1.3 billion [3][7]. - In contrast, a recent capital increase in December 2023 valued Liji Storage at nearly 2.9 billion, indicating a significant discrepancy in valuation [8]. Market Position and Future Prospects - Liji Storage ranks fourth among Chinese companies in the global niche DRAM market and eleventh among all participants [4]. - The company is one of the few in China with high-bandwidth 3D stacking technology and plans to launch HSM (Hybrid Stacked Memory) products by 2026, aiming to become a pioneer in domestic high-bandwidth memory chip production and commercialization [11][12]. - The market share of high-bandwidth memory (HBM) in the DRAM sector is expected to grow from 18% in 2024 to over 50% by 2030, with a compound annual growth rate of 33% [11].

Core Viewpoint - The article discusses the recent developments regarding the Hong Kong IPO of Lijichuang Storage, including the resignation of Minyin Securities as the overall coordinator and the implications of this change on the company's IPO timeline. The company asserts that this change is a normal part of the IPO process and will not affect its planned schedule. Group 1: Company Overview - Lijichuang Storage is a memory chip design company established in 2020, focusing on niche storage products such as 8Gb DDR4 and earlier generations, primarily used in consumer electronics, telecommunications, automotive electronics, energy, and industrial applications [3][8] - The company ranks fourth among domestic peers in terms of revenue, holding a 0.8% share of the global niche DRAM market as of 2024 [3] Group 2: IPO Process and Coordination Changes - The adjustment in the intermediary team occurred just two weeks after Lijichuang Storage restarted its Hong Kong IPO process, with Minyin Securities resigning as the overall coordinator on December 12 [2][3] - The company confirmed that the change in coordinators is a standard procedure in the IPO process and will not impact the overall timeline [1][3] Group 3: Financial Performance - Lijichuang Storage has not achieved profitability, reporting revenues of 610 million RMB, 580 million RMB, 650 million RMB, and 410 million RMB for the years 2022 to 2025, with net losses of 140 million RMB, 220 million RMB, 110 million RMB, and 50 million RMB respectively [12] - The company's gross margin has been low, with a negative margin of -2.1% in 2022, improving to 3.7% in 2023, but still remaining low due to a market expansion strategy that prioritizes volume over margin [12][14] Group 4: Strategic Partnerships - Lijichuang Storage has a close relationship with Lijidian, which has been its sole foundry partner, accounting for 34.4% to 49.1% of its procurement from 2022 to 2025 [10] - The company is collaborating with Lijidian to develop advanced memory products, with plans to start mass production of 19nm products by Q3 2027 [10] Group 5: Market Strategy and Future Outlook - The company plans to continue prioritizing market share expansion over immediate profitability, which is expected to result in further net losses in 2025 [15] - The increase in share-based payment expenses, which reached 150 million RMB in 2023, has also contributed to the company's financial losses [14]

Core Viewpoint - Zhejiang Li Ji Storage Technology Co., Ltd. has submitted a new application for an IPO on the Hong Kong Stock Exchange, marking its second attempt this year, reflecting the company's strong determination to enter the capital market [1] Company Overview - Li Ji Storage is a leading memory chip design company in China, focusing on niche markets with core products including 8Gb DDR4 and earlier generation memory chips [1] - According to Frost & Sullivan, the company ranks fourth among Chinese companies in the global niche DRAM market and eleventh among all participants [1] Business Structure and Performance - The company's main business segments include memory chips, memory modules, and KGD wafers, with a noticeable optimization in its business structure in recent years [1] - Revenue from memory chips is projected to drop from 70.2% in 2024 to 53.3% in the first half of 2025, while memory module revenue surged to 165 million yuan in the first half of 2025, representing a 217% year-on-year increase and accounting for 42.2% of total revenue [1] Financial Performance - The company is currently in a strategic expansion phase and has not yet achieved profitability, reporting net losses of 139 million yuan in 2022, 244.3 million yuan in 2023, 108.9 million yuan in 2024, and 49.8 million yuan in the first half of 2025 [2] - The reasons for the ongoing losses include share-based payment expenses, cyclical industry fluctuations, and high R&D investments [2] Industry Outlook - Despite short-term profitability challenges, industry experts remain optimistic about the long-term prospects of the niche DRAM market, which is expected to show resilience due to mature technology, stable market demand, and differentiated product positioning [2] - In 2024, niche DRAM is projected to account for 8.5% of the global DRAM market and 15.9% in the Chinese market, indicating significant growth opportunities for local companies like Li Ji Storage as the domestic supply chain improves and market demand stabilizes [2]

Core Viewpoint - The article discusses the recent developments of LiJichuang Storage, a memory chip design company, including its updated IPO application and growth in the niche DRAM market, highlighting its financial performance and market positioning. Company Overview - LiJichuang Storage specializes in the design of DRAM memory chips, focusing on 8GB DDR4 and earlier generations. The company was established in March 2020 after acquiring assets from Zental Japan [6][9]. - The company is closely related to Taiwan's chip manufacturer, Powerchip Semiconductor Manufacturing Corporation, which is its sole third-party foundry supplier [9]. Financial Performance - LiJichuang Storage's total storage capacity sold increased from 13.8 million GB in 2022 to 34.2 million GB in 2024, with over 1 million memory chips sold in 2024 [9]. - The company's revenue for 2022, 2023, 2024, and the first half of 2025 was RMB 610 million, RMB 580 million, RMB 646 million, and RMB 412 million, respectively, with net profits of -139 million, -245 million, -110 million, and -50 million [12][15]. - The gross profit margin improved from -2.1% in 2022 to 10.2% in 2025, indicating a recovery from previous losses due to the downturn in the DRAM industry [14]. Market Positioning - In the global niche DRAM market, LiJichuang Storage ranks 4th among Chinese companies with a market share of 11.1% and 11th globally with a market share of 0.8% [10][12]. - The global integrated circuit market is projected to reach RMB 3.81 trillion in 2024, with the memory chip market accounting for approximately RMB 1.19 trillion, representing 31.3% of the total market [10]. Product and Technology - LiJichuang Storage produces niche DRAM products, which are less stringent in performance requirements compared to mainstream DRAM products, and are crucial for automotive, communication, and industrial applications [10][11]. - The company has established R&D centers in China and Japan, employing experienced professionals from leading semiconductor firms [17][18]. Customer and Supplier Dynamics - The company has a high customer concentration, with its top five customers contributing approximately 64.0% to 51.0% of total revenue over the past few years [20][22]. - LiJichuang Storage's procurement is also concentrated, with its top five suppliers accounting for about 97.0% to 76.2% of total procurement amounts [24][26]. Ownership and Management - The founder of LiJichuang Storage holds a direct stake of 44.6% in the company, indicating significant ownership and control [27].

Core Viewpoint - The company, Liji Storage, specializes in the design of DRAM memory chips, focusing on 8GB DDR4 and earlier generations, and has shown significant growth in sales and product capacity due to the development of storage chips and AI computing industries. Group 1: Company Overview - Liji Storage was founded in March 2020 after acquiring Zental Japan, a Japanese memory chip design company [3] - The company is closely related to Taiwan's chip manufacturer, Liji Electronics, which is its sole third-party foundry supplier [3] - Liji Storage was recognized as a national-level "specialized and innovative" small giant enterprise in 2024 [3] Group 2: Sales and Financial Performance - The total storage capacity sold by Liji Storage increased from 13.8 million GB in 2022 to 34.2 million GB in 2024, with over 1 million memory chips sold in 2024 [3] - Revenue for Liji Storage in 2022, 2023, 2024, and the first half of 2025 was approximately RMB 610 million, RMB 580 million, RMB 646 million, and RMB 412 million respectively [12] - The net profit for the same periods was -RMB 139 million, -RMB 245 million, -RMB 110 million, and -RMB 50 million [12] Group 3: Market Position and Product Focus - Liji Storage ranks 4th in China and 11th globally in market share, with a latest gross margin of 10.2% [5] - The global integrated circuit market is projected to reach RMB 3.81 trillion in 2024, with the memory chip market accounting for approximately RMB 1.19 trillion [5] - DRAM holds a dominant position in the memory chip market, with a market size of RMB 697.9 billion in 2024, representing 58.7% of the memory chip market [5] Group 4: Research and Development - Liji Storage has R&D centers in China and Japan, employing experts with extensive experience in DRAM design and management [15] - The company holds 80 patents, including 71 in China and 9 in Japan, focusing on technologies such as 8GB DDR4 and high-bandwidth memory [15][16] Group 5: Customer and Supplier Concentration - Liji Storage's revenue from its top five customers accounted for approximately 64.0%, 66.8%, 52.0%, and 51.0% of total revenue in the respective years [18] - The company has a high supplier concentration, with the top five suppliers accounting for about 97.0%, 88.6%, 76.2%, and 77.5% of total procurement in the respective years [20]

Core Insights - Several technology companies, including Dell Technologies and HP, have warned of a potential shortage of memory chips next year due to a surge in demand driven by AI infrastructure development [1][3] - Market research firm Counterpoint Research predicts that memory module prices could rise by 50% by the second quarter of next year [1] - The shortage of memory chips may increase manufacturing costs across various products, from smartphones to medical devices and automobiles [1] Group 1: Company Responses - Dell Technologies is adjusting its configurations and product mix, considering options such as repricing some devices due to rising costs [2] - HP's CEO indicated that the second half of 2026 will be particularly challenging, and the company may raise prices as necessary [2] - Apple has a more optimistic outlook, with its CFO noting a slight tailwind in memory prices while emphasizing effective cost management [2] Group 2: Market Dynamics - The memory chip industry is entering what analysts refer to as a "super cycle," with manufacturers prioritizing high-bandwidth memory (HBM) production over traditional memory types [3][7] - Major players like Samsung and SK Hynix are shifting their focus to higher-margin, advanced memory products, planning to cease DDR4 production by late 2025 [6] - Morgan Stanley estimates that tech giants will invest $400 billion in AI infrastructure this year, exacerbating the supply constraints for non-HBM memory chips [6] Group 3: Price Trends - The price of RAM has surged significantly, with 4GB DDR4X chips rising from $7 to over $30 per unit, a 3-4 times increase [6] - NAND flash memory prices have also increased, with 64G eMMC chips going from $3.2 to over $8, a nearly 1.5 times rise [6] - The ongoing demand for memory chips is expected to sustain price increases for several quarters [8]