Core Viewpoint - Chongqing Zhixin Industrial Co., Ltd. is accelerating its A-share IPO despite significant growth in performance, with accounts receivable reaching nearly 30% of total assets by the end of 2024, primarily due to high bad debt losses and inventory impairment losses related to the Neta automobile project [1][2][3] Financial Performance - The company's operating revenue from 2022 to 2024 was 2.091 billion, 2.564 billion, and 3.088 billion respectively, with net profit attributable to the parent company after deducting non-recurring gains and losses at 52.25 million, 120 million, and 185 million respectively [2] - Other income during the same period was 19.74 million, 27.74 million, and 43.11 million, accounting for 28.87%, 18.25%, and 19.45% of operating profit, mainly from government subsidies and VAT deductions [2] - Accounts receivable net amount at the end of each year from 2022 to 2024 was 863 million, 929 million, and 1.133 billion, representing 27.39%, 27.14%, and 29.90% of total assets [2][3] Bad Debt and Inventory Losses - Bad debt losses for accounts receivable were 14.32 million, 4.13 million, and 25.34 million from 2022 to 2024, with the 2024 losses primarily attributed to expected credit losses from customers related to the Neta automobile project [3] - Inventory impairment losses increased from 36.54 million and 33.63 million in 2022 and 2023 to 72.61 million in 2024, mainly due to asset impairment losses related to the Neta automobile project [3] Labor and Production Model - The company employed a significant number of labor dispatch workers, with the proportion reaching 21.24% in 2022, then dropping significantly in 2023 and 2024 [1][4] - The external processing amount as a percentage of total procurement increased from 3.81% to 4.60% from 2022 to 2024, focusing on processing and welding operations [4] Client and Supplier Relationships - The main business revenue from welding parts remained stable at over 90%, with gross margins increasing from 12.98% in 2022 to 15.98% in 2024, attributed to declining raw material prices and cost reduction measures [4] - Changan Ford and its affiliates were significant players as both major customers and suppliers, appearing in the top five for both categories during the reporting period [4][5]

Core Viewpoint - Chongqing Zhixin Industrial Co., Ltd. (hereinafter referred to as "Zhixin Co.") has officially initiated its IPO process on the Shanghai Stock Exchange, marking its 30th anniversary, but it is lagging behind its peers in capital market layout [1][6][8] Group 1: IPO Details - Zhixin Co. has received acceptance for its IPO application on June 6, 2025, with a planned fundraising amount of approximately 1.329 billion yuan [3][4] - The funds will be allocated to expanding production capacity and technological upgrades for its automotive stamping production lines, with 1.029 billion yuan for capacity expansion and 300 million yuan for working capital [4] Group 2: Financial Performance - The company has shown steady growth in revenue and net profit from 2022 to 2024, with revenues of approximately 2.091 billion yuan, 2.564 billion yuan, and 3.088 billion yuan, and net profits of approximately 70.69 million yuan, 132 million yuan, and 204 million yuan respectively [4][9] Group 3: Accounts Receivable - Zhixin Co. has experienced a continuous increase in accounts receivable, with values of approximately 863 million yuan, 929 million yuan, and 1.133 billion yuan at the end of 2022, 2023, and 2024, respectively, representing 55.68%, 52.18%, and 57.42% of current assets [4][5] Group 4: Capital Market Position - Established in 1995, Zhixin Co. is late to enter the capital market compared to its peers, with most comparable companies having gone public before it [6][7] - The company's debt-to-asset ratio is significantly higher than the industry average, with ratios of 61.51%, 59.97%, and 58.42% from 2022 to 2024, compared to industry averages of 50.53%, 48.53%, and 47.12% [7][8] Group 5: Control and Governance - The actual controllers of Zhixin Co., Chen Zhiyu and Jing Bing, hold over 83.75% of the voting rights, raising concerns about governance and decision-making transparency [8][9] - The company has a high customer concentration, with sales to its top five customers accounting for approximately 73.86%, 79.77%, and 74.82% of total revenue from 2022 to 2024 [9]