Core Viewpoint - Rongxin Huike Electric Co., Ltd. is attempting to relist on the Sci-Tech Innovation Board (STAR Market) after a previous failed IPO due to undisclosed issues regarding a controlling shareholder, raising concerns about the legitimacy of its asset transfer and financial stability [1][2][11]. Company Background - Rongxin Huike was established in January 2017, fully funded by the A-share listed company Dream Network Rongxin, which had previously transformed into a mobile internet-focused entity [2][4]. - The company specializes in the research, manufacturing, and sales of core equipment for new power systems, including flexible transmission equipment and high-power converters [2]. Financial Performance - The company has shown significant revenue volatility, with revenues of 19.42 billion RMB in 2022, plummeting to 2.33 billion RMB in 2023, a decrease of 88.01% year-on-year [15][16]. - The net profit attributable to the parent company has also fluctuated, with a profit of 1.76 billion RMB in 2022, a loss of 0.66 billion RMB in 2023, and a slight profit of 0.38 billion RMB in 2024 [15][16]. - The company’s cash flow from operating activities has turned negative, indicating worsening financial health, with figures of 2.52 billion RMB in 2022, -1.41 billion RMB in 2023, -1.86 billion RMB in 2024, and -3.21 billion RMB in the first half of 2025 [21]. IPO and Valuation Concerns - The IPO plan involves issuing up to 135.6 million shares, aiming to raise approximately 976.95 million RMB, which would imply a pre-IPO valuation of around 3.9 billion RMB [12]. - Recent share transfers have shown decreasing valuations, with the latest transfer in April 2025 valuing the company at approximately 1.237 billion RMB, significantly lower than previous valuations [12][13]. - The company’s ability to meet IPO listing standards is in question due to its inconsistent financial performance, particularly if it incurs losses in 2025 [16][18]. Industry Comparison - Compared to peers, Rongxin Huike's financial stability and performance are significantly weaker. Competitors have consistently reported profits, while Rongxin Huike has faced frequent losses [18][20]. - The company’s technology may be advanced, but its ability to convert this into stable revenue is under scrutiny, especially when compared to other companies in the same sector that have shown steady growth [18][20].