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].

Group 1 - The semiconductor industry is a hot area for IPOs this year, with several companies like ZheJiang LiJi Storage Technology Co., Ltd. recently attempting to enter the capital market [1][2] - ZheJiang LiJi Storage is a memory chip design company and AI computing solution provider, offering a complete product line from SDR to DDR4 [3][8] - The company operates in a competitive niche DRAM market, which is characterized by significant cyclicality, and has incurred cumulative losses of 490 million RMB over the past three years [4][29] Group 2 - The company's history dates back to 2020 when its controlling shareholder recognized the potential of DRAM and acquired a majority stake in Zentel Japan, inheriting the "Zentel" brand [6] - The company was initially backed by Longxin Zhongke, but after several rounds of capital increases and share transfers, it is now primarily supported by multiple investment entities under Dinghui Investment [7] - As of May 20, 2025, the controlling shareholder is Wei Ying, who has extensive experience in various listed companies [7] Group 3 - ZheJiang LiJi Storage's revenue from memory chips, modules, and KGD wafers for 2024 is projected to be 70.2%, 21.3%, and 8.4% respectively [9] - The company's revenue has fluctuated in recent years, with figures of 610 million RMB, 580 million RMB, and 646 million RMB for 2022, 2023, and 2024 respectively, alongside net losses of 139 million RMB, 244 million RMB, and 109 million RMB [11][12] - The average selling price of memory chips has dropped significantly from 42.7 RMB per GB in early 2022 to 19.8 RMB per GB by the end of 2023, a decrease of 53.63% [13] Group 4 - The company has a high R&D expenditure, which accounted for 12.1%, 13.3%, and 14.8% of its revenue in 2022, 2023, and 2024 respectively, contributing to its losses [15] - As of 2024, the company has 137 employees, with approximately 53.3% in the R&D department, primarily sourced from major semiconductor firms [16] - The company relies on external wafer manufacturing and packaging services, with significant procurement from its top suppliers [16] Group 5 - The global integrated circuit market is projected to reach 3.81 trillion RMB in 2024, with the memory chip market accounting for 1.19 trillion RMB, representing 31.3% of the total [22] - The DRAM segment is expected to dominate the memory chip market, with a projected market size of 697.9 billion RMB in 2024, capturing 58.7% of the market [22] - The niche DRAM market in China is anticipated to reach 37.9 billion RMB in 2024, with the competitive landscape expected to improve as international players gradually exit [27][29]

Core Viewpoint - The semiconductor storage chip industry is becoming a key battleground in global technology competition, driven by domestic substitution and the explosive demand for AI computing power. The global storage chip market is projected to reach 1,189.7 billion RMB in 2024, with DRAM accounting for 697.9 billion RMB and a 58.7% market share [1]. Group 1: Company Overview - Zhejiang Liji Storage Technology Co., Ltd. focuses on memory chip design and AI computing solutions, having evolved into a leading memory chip design company in China after acquiring Zentel Japan in 2020 [2]. - The company's business model revolves around memory chip design, packaging, and testing, with products including memory chips, memory modules, and KGD wafers [2]. - Memory chips constitute the core business of the company, maintaining a revenue share of 70.2% to 88.2% from 2022 to 2024 [3]. Group 2: Financial Performance - The company experienced revenue of 610 million RMB in 2022, 580 million RMB in 2023, and is projected to reach 646.4 million RMB in 2024, indicating a "first decline then rise" trend [5]. - Cumulative losses over three years amount to nearly 500 million RMB, with annual losses of 139 million RMB, 244 million RMB, and 109 million RMB from 2022 to 2024 [7]. - The gross margin improved from -2.1% in 2022 to 9.3% in 2024, driven by a recovery in memory chip prices and an increase in high-margin module business [7]. Group 3: Market Position and Growth Potential - By 2024, the company ranks fourth among domestic players in the niche DRAM market, with a market share of 11.3% in China and 0.8% globally [3][4]. - The global DRAM market is expected to grow at a compound annual growth rate (CAGR) of 5.1% from 2024 to 2029, while the Chinese market is projected to grow at a CAGR of 7.6% [11]. - The company is enhancing its core competitiveness through continuous technological innovation and optimizing its business structure to expand its market share [14]. Group 4: Future Strategies - The company plans to use funds from its potential IPO to enhance R&D capabilities, improve production and testing capacities, and expand global sales and marketing efforts [14]. - Measures will be taken to improve financial conditions, including better inventory management and optimizing accounts receivable and payable [14].