Jiangsu Dianduo Technology Co., Ltd., a semiconductor process exhaust system provider, has moved forward in its ChiNext IPO process after recently disclosing its response to the first round of review inquiry letters.

The company has posted consistent revenue and profit growth during the reporting period. However, concerns remain including cash dividends distributed before plans to raise funds for working capital, rising accounts receivable balances, and R&D expense ratios trailing industry averages. Additionally, actual controller Zhong Ping holds 94.21% of the company's voting shares.

Company Addresses Dividend Concerns

According to the Shenzhen Stock Exchange website, Dianduo Technology's ChiNext IPO application was accepted on June 28, 2026, and entered the inquiry phase on July 18. The company recently disclosed its responses to the first round of review questions. Founded in 2010, Dianduo Technology is a nationally recognized "Little Giant" enterprise specializing in R&D, design, manufacturing, and installation services for semiconductor process exhaust systems.

Financially, the company achieved year-over-year growth in both revenue and net profit during the reporting period. From 2023 to 2025, revenue reached approximately RMB 446 million, RMB 528 million, and RMB 677 million respectively, while net profits attributable to shareholders were approximately RMB 76.06 million, RMB 103 million, and RMB 118 million.

For this IPO attempt, the company plans to raise approximately RMB 987 million, allocated to a semiconductor intelligent environmental equipment and piping/accessories production base project (RMB 573 million), a smart manufacturing base equipment technology upgrade project (RMB 121 million), an R&D center construction project (RMB 193 million), and working capital supplementation (RMB 100 million). Notably, the company distributed cash dividends of RMB 59.08 million in 2023 and RMB 10.69 million in 2025, prior to the fundraising plan.

In response, Dianduo Technology stated that it had not distributed any cash dividends from its establishment until early 2023. During the reporting period, with sustained revenue and profit growth and a sound financial position, the dividends were implemented following necessary review procedures, with distribution plans complying with relevant laws and the company's articles of association. The company noted that the working capital supplement is intended to meet future business expansion needs. As business scale grows and funded projects are implemented, working capital requirements will increase further, especially given the significant working capital occupation by systematic delivery projects. Semiconductor owners' capital expenditure demands often release concurrently due to similar cyclical factors, making sufficient working capital crucial for securing and executing orders and supporting sustainable development.

Regarding control structure, Shanghai Dianduo holds 78.84% of the company's shares as the controlling shareholder, while Zhong Ping controls 94.21% of voting shares as the actual controller. Born in January 1973, Zhong currently serves as chairman, general manager, and core technical personnel. The company explained that it has established a sound governance structure and internal control systems, with measures including institutional regulations, independent director and audit committee oversight, and written commitments from controlling shareholders to mitigate risks of improper control.

R&D Spending Lags Peers

During each reporting period, Dianduo Technology's R&D expense ratio remained notably below the average of comparable listed companies. From 2023 to 2025, R&D expenses were approximately RMB 16.76 million, RMB 19.93 million, and RMB 22.26 million, representing 3.76%, 3.78%, and 3.29% of revenue respectively. During the same period, comparable listed companies averaged R&D ratios of 6.81%, 7.36%, and 8.38%.

The R&D expenses primarily consisted of employee compensation and material inputs, which together accounted for 95.6%, 92.64%, and 88.68% of total R&D spending. The company attributed the lower ratio to differences in business nature, technology types, and regional wage levels. Based on its prospectus calculations, if wage compensation in R&D were doubled to adjust for regional wage differences, the R&D expense ratios would be 5.36%, 5.45%, and 4.8%, exceeding the level of comparable company Shengjian Technology at its IPO. R&D personnel numbered 50, 54, and 54 at each period end, representing 10.82%, 10.42%, and 9.47% of total employees.

According to lawyer Sun Yuhu, a senior partner at Shanghai Haihua Yongtai Law Firm, a lower R&D expense ratio does not simply equate to insufficient technical capability. Key considerations include the company's specific business model and R&D stage, as well as factors such as revenue growth scale, R&D project cycles, and how R&D personnel and equipment investments are structured. Sun further noted that assessing whether an R&D ratio is reasonable requires more than horizontal comparison with industry averages — one must also examine absolute R&D spending and trends, R&D headcount, core technology formation processes, patents and outcomes, and whether those outcomes consistently convert into orders and product competitiveness.

Rising Accounts Receivable

Dianduo Technology's prospectus highlights a noticeable increase in accounts receivable balances. At the end of each reporting period, accounts receivable stood at approximately RMB 285 million, RMB 289 million, and RMB 370 million, representing 63.82%, 54.82%, and 54.75% of revenue respectively. The company stated that the continued growth aligns with its expanding business scale.

However, accounts receivable turnover consistently lagged comparable company averages. Turnover rates were 2.04 times, 1.84 times, and 2.05 times during the reporting periods, versus industry averages of 2.56 times, 2.44 times, and 2.41 times. The company explained that its turnover exceeds that of Shengjian Technology, which, despite some overlap in product forms and business models, serves display panel customers while Dianduo primarily serves semiconductor wafer fab clients. Conversely, turnover trails that of Zhengfan Technology and Jingyi Equipment, whose primary or partial products directly participate in wafer manufacturing process steps or supply essential raw materials for process tools. Their direct customers are semiconductor wafer manufacturers who procure such equipment or materials after completing facility or production line construction, without lengthy project settlement processes, resulting in higher turnover rates.

Inventory book balances at each period end were approximately RMB 312 million, RMB 431 million, and RMB 372 million, accounting for 49.93%, 54.43%, and 43.58% of current assets respectively. The company noted that inventory mainly comprises contract fulfillment costs — under its systematic delivery model, these represent materials delivered and installed at project sites but not yet accepted, along with corresponding installation service expenditures, labor costs, and other expenses.