Core Viewpoint - 易思维 (Hangzhou) Technology Co., Ltd. is facing significant uncertainties in its pursuit of listing on the Sci-Tech Innovation Board, despite showcasing impressive performance in its prospectus, due to underlying structural risks, policy dependence, and regulatory challenges [1] Financial Performance - From 2022 to 2024, the company achieved a nearly 300% compound annual growth rate in net profit, rising from 5.38 million to 84.43 million yuan [2] - The total net profit during this period was 147 million yuan, while tax incentives and government subsidies amounted to 186 million yuan, indicating a heavy reliance on non-recurring income [2] - In 2024, tax incentives and government subsidies accounted for 87% of the net profit, raising concerns about the sustainability of the company's core business profitability [2][3] Dependency on Government Support - Industry insiders suggest that the company's performance is heavily reliant on government support rather than its own capabilities, with 41% of net profit in 2023 and 2024 coming from government subsidies [3] - The company acknowledged that changes in government policies regarding tax incentives or subsidies could lead to a significant drop in performance, posing a "cliff-like" risk to its earnings [3] Business Structure and Market Risks - The company's revenue is highly concentrated, with over 90% coming from the automotive manufacturing sector, which is sensitive to macroeconomic changes [4] - The automotive industry is currently facing structural overcapacity, with a utilization rate of only about 59% in 2024, leading to a significant decline in profit margins from 8.99% in 2014 to 3.9% in Q1 2025 [4] - The company lacks a second growth curve or buffer in other sectors, as revenue from rail transit, aviation, and other fields accounted for less than 4% in 2024 [4] Regulatory Challenges - The actual controller of the company, Dr. Guo Yin, has been involved in multiple equity transfer activities amounting to millions, raising concerns about potential cashing out before the IPO [5] - Following the acceptance of its IPO application, the company was included in the 2025 second batch of IPO on-site inspection list by the China Securities Association, which could jeopardize its listing process [5] - The focus of the regulatory inspection will be on the authenticity of R&D expenses, compliance of government subsidies, and the accuracy of financial data, with a high termination rate for inspected IPO companies since 2022 [5]