Core Viewpoint - Meilian Steel Structure Building System Co., Ltd. (Meilian) is facing challenges with a low net profit margin of 4.4% and significant revenue fluctuations, raising questions about its upcoming secondary listing on the Hong Kong Stock Exchange [1] Company Overview - Meilian primarily engages in prefabricated steel structure construction subcontracting, professional engineering contracting, and industrial environmental protection equipment, with the prefabricated steel structure subcontracting being the largest revenue source [1][4] - The company holds a 3.5% market share in China's prefabricated steel structure construction market, ranking third [1][6] Financial Performance - Revenue has fluctuated from RMB 1.903 billion in 2022 to RMB 1.523 billion in 2024, with a significant increase of 179.5% in the first half of 2025 [1][2] - The net profit margin has remained stable between 4.3% and 4.6% from 2022 to the first half of 2025, with a slight increase to 4.4% in the latest period [5] Business Segments - The revenue distribution for the first half of 2025 is as follows: prefabricated steel structure subcontracting (87.6%), professional engineering contracting (9.9%), and industrial environmental protection equipment (2.5%) [1][4] - The prefabricated steel structure subcontracting business saw a revenue increase of 182.1% in the first half of 2025, driven by project growth and demand from the automotive sector [2][4] Market Dynamics - The prefabricated steel structure construction market in China is projected to decline from RMB 512.2 billion in 2021 to RMB 441.3 billion in 2024, a decrease of 13.8% [1][6] - The market is characterized by high concentration, with the top five players holding a combined market share of 52.6%, and Meilian's competitive position is relatively weak compared to the top two players [6][9] Client Base and Risks - Meilian's client base is concentrated, with the top five clients contributing 84% of revenue, and the largest client accounting for 61.1% [4][9] - The company faces risks related to high client concentration, low profit margins, and significant debt, with bank loans amounting to RMB 380 million against cash equivalents of only RMB 179 million [9]

Core Viewpoint - Meilian Steel Structure Building System Co., Ltd. (Meilian) is facing challenges with a low net profit margin of 4.4% and significant revenue fluctuations, raising questions about its upcoming secondary listing on the Hong Kong Stock Exchange [1] Company Overview - Meilian primarily engages in prefabricated steel structure construction subcontracting, professional engineering contracting, and industrial environmental equipment, with the prefabricated steel structure subcontracting being the largest revenue source [1][5] - The company holds a 3.5% market share in China's prefabricated steel structure construction market, ranking third [1][10] Financial Performance - Revenue has declined from RMB 1.903 billion in 2022 to RMB 1.523 billion in 2024, but there was a significant increase of 179.5% in the first half of 2025 [1][2] - The net profit margin has remained stable, fluctuating between 4.3% and 4.6% from 2022 to the first half of 2025, with a slight increase to 4.4% in the first half of 2025 [1][6] Market Dynamics - The prefabricated steel structure construction market in China is projected to decrease from RMB 512.2 billion in 2021 to RMB 441.3 billion in 2024, a decline of 13.8% [1][7] - The market is expected to grow at a compound annual growth rate (CAGR) of 5.3% from 2024 to 2029, reaching RMB 551.3 billion [7] Business Segments - The prefabricated steel structure subcontracting business saw a revenue increase of 182.1% in the first half of 2025, driven by project growth and demand from the automotive sector [2][5] - The professional engineering contracting segment has also shown rapid growth, with a revenue increase of 576.2% in the first half of 2025 [5] Client Concentration - The company has a high client concentration, with the top five clients contributing 84% of total revenue, and the largest client accounting for 61.1% [5][10] - Long-term relationships with major clients provide some revenue stability, but also pose risks due to high dependency [10] Industry Competition - The industry is characterized by high concentration, with the top five players holding a combined market share of 52.6%, and the largest player dominating with a 35.8% share [10] - Meilian's competitive position is relatively weak compared to the top two players, which may impact its market performance [10]

Core Viewpoint - Meilian Steel Structure Building System (Shanghai) Co., Ltd. has submitted an application to the Hong Kong Stock Exchange for a main board listing, with Shenwan Hongyuan (Hong Kong) as the sole sponsor. The company previously submitted an application on February 14, 2025 [1]. Company Overview - Meilian is a comprehensive subcontractor in the prefabricated steel structure building market, providing integrated services including project design, procurement, manufacturing, and installation, primarily in China and overseas [3]. - The company ranks third in the industrial sector of China's prefabricated steel structure market with a market share of 3.5%, while the top two competitors hold market shares of 35.8% and 6.5% respectively [3]. Production Capacity and Utilization - The company's production facilities are located in Shanghai, Suzhou (Jiangsu Province), and Jiangmen (Guangdong Province). The capacity utilization rates for prefabricated steel structure components were 128.3%, 88.1%, 101.7%, and 158.7% for the years ending December 31, 2022, 2023, 2024, and the six months ending June 30, 2025, respectively. For industrial environmental protection equipment, the utilization rates were 50.9%, 72.7%, 85.9%, and 82.7% for the same periods [3]. Revenue and Profitability - The company's revenue for the fiscal years 2022, 2023, 2024, and the six months ending June 30, 2025, were approximately RMB 1.903 billion, RMB 1.453 billion, RMB 1.523 billion, and RMB 1.424 billion, respectively. Corresponding profits were RMB 87.706 million, RMB 62.132 million, RMB 70.783 million, and RMB 62.629 million [5][6]. Client Dependency - A significant portion of the company's revenue is derived from major clients, with the top five clients contributing approximately 77.7%, 64.6%, 59.0%, and 84.0% of total revenue in the respective years. The largest client accounted for about 64.8%, 43.1%, 42.1%, and 61.1% of total revenue in the same periods [4].