For stock trading, rely on Jinlinqi analyst reports — authoritative, professional, timely and comprehensive, helping you uncover potential thematic opportunities! Recently, Ningbo Peiyuan Co., Ltd. (hereinafter referred to as "Peiyuan Shares") responded to the second round of inquiries from the Beijing Stock Exchange.

During the reporting period, Peiyuan Shares' revenue grew continuously, but net profit fluctuated significantly. Net profit fell sharply in 2024, and in the first half of 2026 revenue rose while profit did not, which is closely related to exchange gains and losses caused by a high share of export revenue. The top five customers accounted for about 80% of Peiyuan Shares' revenue, indicating a high degree of dependence. On the procurement side, Peiyuan Shares' outsourced processing amount surged, but outsourced procurement involves risks such as supplier management, pricing fairness and environmental compliance.

In 2025, the share of revenue confirmed through reconciliation rose to 54%, with issues involving non-official email and WeChat reconciliation, especially a sharp increase in both the amount and share of WeChat reconciliation. In addition, changes in the company's consignment model and corrections of annual price reduction rebate errors both involve accounting judgments. Whether the company's response can dispel the key doubts raised by regulators remains to be seen.

Customer concentration higher than comparable peers

The prospectus shows that Peiyuan Shares is a high-tech enterprise specializing in the research, development, production and sales of auto parts, with its main business being the research, development, production and sales of shock absorber parts such as shock absorber piston rods and shock absorber outer cylinders, as well as hydraulic flip system parts such as hydraulic flip system piston rods. The company's leading product, the automotive shock absorber piston rod, is a core component of automotive shock absorbers.

From 2023 to 2025 and in the first half of 2026, Peiyuan Shares' operating revenue was 610 million yuan, 652 million yuan, 720 million yuan and 382 million yuan respectively; up 10.63%, 6.97%, 10.36% and 14.85% year on year; and net profit attributable to the parent was 76 million yuan, 60 million yuan, 88 million yuan and 34 million yuan respectively, changing by 9.54%, -21.36%, 47.72% and -1.42% year on year.

It is not difficult to see that Peiyuan Shares' revenue grew continuously, but net profit fluctuated significantly. Net profit fell by more than 20% in 2024, and in the first half of 2026 revenue rose without a corresponding profit increase, which is closely related to exchange gains and losses caused by a high share of export revenue. From 2022 to 2024 and in the first half of 2025, Peiyuan Shares' export revenue as a proportion of main business revenue was 55.79%, 55.65%, 58.68% and 56.14% respectively; the company's exchange gains and losses were -17.9011 million yuan, -12.2906 million yuan, 9.9147 million yuan and -11.487 million yuan respectively.

In addition, Peiyuan Shares is relatively dependent on a single product. From 2023 to 2025, sales revenue from the company's automotive shock absorber piston rod product was 525.8017 million yuan, 561.1674 million yuan and 605.8974 million yuan respectively, accounting for 86.25%, 86.06% and 84.2% of operating revenue in each period. A product structure relying on "one piston rod to conquer the market" means the company's operating performance is highly tied to the prosperity of the downstream automotive shock absorber market. Once the auto industry experiences cyclical fluctuations, technological routes change, or major customers adjust procurement strategies, the company may lack sufficient business buffer.

Equally noteworthy is Peiyuan Shares' dependence on major customers. From 2023 to 2025, revenue from sales to the top five customers accounted for 81.53%, 80.49% and 76.79% of operating revenue in each period. In its response to the inquiry, the company explained that ZF, Tenneco, ThyssenKrupp and Astemo are all globally leading auto parts manufacturers and were major customers of the issuer during the reporting period, which led to high customer concentration.

Source: application materials. This explanation by Peiyuan Shares is reasonable in terms of industry logic. However, Peiyuan Shares' customer concentration is significantly higher than that of comparable companies in the same industry. Taking Beite Technology as an example, its top five customers accounted for about 36.85% of revenue in 2025, while Demaisi accounted for about 49.86%; the average of comparable peers was 54.39%, while Peiyuan Shares was as high as 76.79%. Peiyuan Shares stated that its main business products are mainly concentrated in automotive shock absorber piston rods, resulting in higher customer concentration.

Outsourced processing amount surges

From 2023 to 2025, Peiyuan Shares' outsourced procurement amount was 63.1821 million yuan, 68.3811 million yuan and 91.3512 million yuan respectively, up 33.57% year on year in 2025; processing fees within manufacturing expenses were 53.7452 million yuan, 60.5433 million yuan and 75.4251 million yuan respectively. The company explained that the surge in outsourced procurement was due to saturated production capacity, but outsourced procurement involves risks such as supplier management, pricing fairness and environmental compliance.

The inquiry response announcement shows that the actual controller of Peiyuan Shares once donated electroplating equipment to the issuer and placed it at outsourced suppliers — Ningbo Yinzhou Tuoji Plating Co., Ltd. and Ningbo Fenghua Chengxin Environmental Protection Technology Co., Ltd. — specifically for processing the company's products, without charging usage fees. During the reporting period, Tuoji Plating's processing revenue from Peiyuan Shares accounted for about 60%-70% of its revenue.

Peiyuan Shares stated that the ownership of the electroplating equipment placed at outsourced suppliers belongs to the company, while the outsourced suppliers only enjoy the right to use it and can only use it to process Peiyuan Shares' products. The electroplating price is fair, and there is no situation that may lead to a substantial transfer of benefits. Tuoji Plating and Chengxin Environmental Protection, which are placed at outsourced suppliers, use Peiyuan Shares' equipment for processing. Peiyuan Shares claimed environmental compliance, saying the outsourced suppliers have obtained environmental impact assessment approvals and pollutant discharge permits, and there were no environmental penalties during the reporting period.

The difference in pipe procurement prices is a sharp issue in the inquiry. From 2023 to 2025, Peiyuan Shares' pipe procurement prices were 8,500 yuan/ton, 8,500 yuan/ton and 8,100 yuan/ton respectively, while the market average prices were 4,900 yuan/ton, 4,600 yuan/ton and 4,200 yuan/ton. The company's procurement price was close to twice the market average.

Source: application materials. In addition, from 2023 to 2025, the procurement share of Peiyuan Shares' top three pipe suppliers was 99.19%, 91.08% and 96.23% respectively, indicating extremely high concentration. Peiyuan Shares stated that the pipes it purchases are precision seamless pipes specially used for automotive shock absorption, requiring suppliers to use round steel bars and steel strips as basic raw materials and complete the full process of precision deep processing, heat treatment and non-destructive testing; low-priced pipes on the market are only simply formed ordinary steel pipes, and the two types of products differ fundamentally in material standards, processing chains and quality control. The persistence of the price difference between the company's pipe procurement unit price and ordinary steel pipe prices on the market can be traced, and there was no artificial increase in pipe procurement prices during the reporting period.

WeChat reconciliation revenue soars 13-fold, with its share rising sharply

Peiyuan Shares' revenue recognition is divided into three modes: reconciliation confirmation, signed receipt confirmation and export customs declaration confirmation, among which revenue confirmed through reconciliation rose to 54% in 2025. From 2023 to 2025, revenue under the company's reconciliation model accounted for 42.67%, 39.97% and 54.10% respectively.

Source: application materials. During the reporting period, the company had issues involving non-official email and WeChat reconciliation, especially a sharp increase in the share of WeChat reconciliation amounts. From 2023 to 2025, Peiyuan Shares' non-official email reconciliation existed only in 2023, amounting to 127,700 yuan, or 0.05% of total reconciliation that year; WeChat reconciliation existed in each year, amounting to 6.0250 million yuan, 1.7872 million yuan and 25.6532 million yuan respectively, accounting for 2.32%, 0.69% and 6.59% respectively.

Peiyuan Shares stated that the company had circumstances of non-official email reconciliation, but the related transaction amount and revenue proportion were relatively low, the reconciliation was authentic and revenue recognition was accurate; there was no revenue fraud, cross-period recognition or other violations, the company had carried out effective rectification and standardization, and the relevant circumstances did not constitute a major defect in revenue recognition.

However, it is worth noting that non-official email and WeChat reconciliation are also regarded in practice as internal control defects. In particular, the company's WeChat reconciliation share rose to 6.59% in 2025, with the amount exceeding 25 million yuan, a 13-fold year-on-year surge.

In addition, changes in Peiyuan Shares' consignment model and corrections of annual price reduction rebate errors both involve accounting judgments. Application materials show that for customers such as ZF Germany, ZF Spain, Tenneco USA and ThyssenKrupp Romania, the revenue recognition method during the reporting period changed from export customs declaration to consignment reconciliation. In terms of amount, the impact of the change seems modest. In 2025, revenue confirmed through consignment reconciliation for ZF Germany, ZF Spain, Tenneco USA and ThyssenKrupp Romania totaled 63.8928 million yuan; if simulated as confirmed by export customs declaration, it would be 77.9057 million yuan, a difference of -14.0129 million yuan, or -1.95% of revenue; in 2024, the total difference was -12.0443 million yuan, or -1.85% of revenue.

Peiyuan Shares' accounting treatment of annual price reductions and sales rebates also involves revenue recognition. During the reporting period, the amounts of regular annual price reductions were 3.0629 million yuan, 2.8131 million yuan and 3.9800 million yuan respectively, accounting for 0.50%, 0.43% and 0.55% of operating revenue; rebate amounts were 6.7392 million yuan, 6.3457 million yuan and 7.5866 million yuan respectively, accounting for 1.11%, 0.97% and 1.05% of operating revenue.

Peiyuan Shares treated rebates as variable consideration offsetting revenue, and had previously made accounting error corrections for sales rebate matters, reducing total profit in 2023 by 175,300 yuan and total profit in 2024 by 664,200 yuan, accounting for 0.19% and 0.89% respectively. Although the impact was small, the error correction itself indicates that there had been cross-period problems in previous rebate accounting, and there had been defects in the completeness and accuracy of revenue recognition.

As of the signing date of this prospectus, Yu Peijun held 26.07% of Peiyuan Shares, Zhang Peiqin held 24.74%, Yu Keyu held 39.55%, and Tian Yu held 0.37%. Together, the four controlled 90.73% of the issuer and were the issuer's joint controlling shareholders and actual controllers. Application materials show that some enterprises controlled by Peiyuan Shares' actual controller Yu Peijun have been involved in private lending disputes, listed as dishonest judgment debtors, and subject to restrictions on high consumption.

The company overlaps with some customers and suppliers of enterprises controlled by actual controller Yu Peijun. In terms of customer overlap, Peiyuan Shares' overlapping customers with Ningbo Zhongchen, controlled by actual controller Yu Peijun, mainly include BYD and Daewoo. The company stated that BYD's and Daewoo's procurement from the company and Ningbo Zhongchen is handled by different procurement material groups, the company and Ningbo Zhongchen have their own independent supplier codes, their products and technologies do not overlap, and they cannot simultaneously obtain the same parts demand packages from OEMs. The company stated that there is no joint acquisition of business opportunities or transfer of business opportunities.

In terms of supplier overlap, Peiyuan Shares and enterprises controlled by the actual controller have a small number of overlapping suppliers in sporadic procurement such as auxiliary materials and spare parts. The company stated that procurement scale from overlapping suppliers is relatively low, there is no situation in which procurement from any overlapping supplier simultaneously exceeds 500,000 yuan, procurement prices are fair, there is no affiliation among the overlapping suppliers, and there is no benefit transfer. However, these formal separations cannot completely eliminate substantive doubts about related-party relationships, because the amount of customer overlap is relatively large (the 2025 sales of both Peiyuan Shares and Ningbo Zhongchen to BYD were around 100 million yuan).

With Peiyuan Shares and other "brother" companies controlled by the actual controller each obtaining orders within the same customer system, is there information sharing, price coordination or transfer of business opportunities? Can the company's explanation dispel investors' concerns? Time will reveal the answer.