Recently, Sichuan Yingfa Ruineng Technology CO., LTD. (hereinafter referred to as "Yingfa Ruineng") submitted its IPO application documents to the Hong Kong Stock Exchange, with CITIC Securities International and Huatai International serving as joint sponsors.

The company plans to allocate approximately 60.6% of the net IPO proceeds to establish and upgrade its Indonesian base, about 15.2% for R&D of advanced technologies applicable to photovoltaic cell product development, approximately 15.2% for enhancing and optimizing domestic and overseas sales channels, with the remaining 9.1% of net proceeds designated for working capital and general corporate purposes.

As the world's third-largest specialized N-type TOPCon (Tunnel Oxide Passivated Contact, an advanced N-type silicon wafer battery technology) solar cell manufacturer, it has been noted that over the past three years, Yingfa Ruineng's raw material costs have consistently represented a high proportion of sales costs, while the company's inventory amounts and inventory turnover days have shown year-on-year growth trends.

According to the application documents, Yingfa Ruineng was established in 2016 as a professional photovoltaic cell manufacturer. Since its establishment, the company has focused on the R&D, production, and sales of photovoltaic cells. Yingfa Ruineng operates with a customer-demand orientation, selling products globally that cover both P-type and N-type solar cells. Additionally, based on N-type TOPCon solar cell technology, the company has strategically positioned itself in the next-generation N-type xBC solar cell technology roadmap.

The application documents cite data from Frost & Sullivan indicating that by 2024 shipment volume, Yingfa Ruineng is the world's third-largest specialized N-type TOPCon solar cell manufacturer, holding a 14.7% global market share.

In the first four months of this year, Yingfa Ruineng's production capacity primarily included 32.7GW annual capacity for N-type TOPCon solar cells. As of April 30, 2025, Yingfa Ruineng's entire production capacity has been converted to the mainstream 182mm and larger-sized solar cells.

Yingfa Ruineng has proactively established substantial advanced solar cell production capacity in Yibin, Sichuan, fully leveraging Yibin's photovoltaic cluster advantages and premium regional resources while deeply collaborating with upstream and downstream industry chain manufacturers also operating in Yibin. Besides its Yibin base, Yingfa Ruineng operates three additional facilities in Mianyang, Sichuan Province; Tianchang, Anhui Province; and Indonesia.

Notably, the company has secured financing from multiple Yibin-based institutions in recent years. According to application documents, since June 2022, Yingfa Ruineng has completed four financing rounds with investors including Yibin High-tech Investment, Yibin Ruineng Investment, Yibin High-tech Industry Investment, Yibin Green Energy, National Green Fund, Donghe Venture Capital, and Jianxin Investment.

During 2022-2024 and the first four months of 2025 (hereinafter referred to as the "reporting period"), Yingfa Ruineng generated revenue primarily through P-type PERC (Passivated Emitter and Rear Cell) solar cells and N-type TOPCon solar cells. According to Frost & Sullivan information, in August 2025, Yingfa Ruineng became the world's first specialized photovoltaic cell manufacturer to achieve commercial production of N-type xBC solar cells.

Specifically, in the first four months of 2025, Yingfa Ruineng's revenue from N-type TOPCon solar cells increased from 7.1% in 2023 to 95.5%.

During the reporting period, Yingfa Ruineng's revenues were approximately 5.643 billion yuan, 10.494 billion yuan, 4.359 billion yuan, and 2.408 billion yuan respectively. Corresponding annual/period profits were approximately 350 million yuan, 410 million yuan, -864 million yuan, and 355 million yuan respectively. In the first four months of this year, Yingfa Ruineng's revenue grew approximately 111% year-on-year, with net profit turning from loss to profit.

During the reporting period, Yingfa Ruineng's top five customers contributed revenues of 2.808 billion yuan, 5.923 billion yuan, 2.384 billion yuan, and 951 million yuan respectively, accounting for 49.7%, 56.5%, 54.7%, and 39.6% of total revenue for the corresponding periods. Revenue from the largest single customer represented 19.7%, 24.4%, 20.5%, and 12.2% respectively for the same periods.

Yingfa Ruineng's top five customers are almost exclusively Chinese photovoltaic module manufacturers. Regarding overseas customers, Yingfa Ruineng's main overseas markets during the reporting period were India and Vietnam. Additionally, the company's overseas revenue proportion increased from 3.2% in 2022 to 24.5% in the first four months of this year.

It has been observed that during the reporting period, Yingfa Ruineng's raw material costs constituted the vast majority of the company's total sales costs. Specifically, raw material costs were 4.567 billion yuan, 8.466 billion yuan, 3.695 billion yuan, 930 million yuan, and 1.479 billion yuan respectively during the reporting period, representing 91.9%, 88.4%, 78.9%, 76.9%, and 80.6% of total sales costs for the corresponding periods. Among these, silicon wafers and silver paste materials alone account for over 50% of total sales costs.

Consequently, Yingfa Ruineng faces risks from price volatility in raw materials such as silicon wafers and silver paste. The company explicitly mentioned that during the reporting period, its raw material prices experienced significant fluctuations, and the company cannot guarantee complete mitigation of raw material cost volatility.

It was also noted that during the reporting period, Yingfa Ruineng's inventory amounts were 265 million yuan, 277 million yuan, 1.153 billion yuan, and 1.346 billion yuan respectively. Corresponding inventory turnover days were 15 days, 10 days, 47 days, and 63 days respectively.

In the application documents, Yingfa Ruineng attributed the increase in inventory amounts during the reporting period primarily to increased raw material demand following the commissioning of Phase I of its Indonesian base, to meet production requirements and promote silicon ingot pulling production, which requires substantial inventory reserves to support enhanced capacity and continuous production activities. Additionally, the expansion of new production base capacity and increased output led to higher finished goods quantities.

The company stated: "We cannot guarantee that our inventory management system will remain consistently effective and maintain optimal inventory levels at all times. Prior to product sales, we must estimate product demand, and due to inherent uncertainties, demand estimates may be inaccurate. If market demand for products unexpectedly declines, it may result in excess inventory; conversely, insufficient inventory may cause us to miss sales opportunities. Failure to adequately manage inventory risks may lead to obsolete inventory, inventory impairment, or inventory write-offs."

Regarding the increase in inventory turnover days, Yingfa Ruineng cited three reasons: first, expanded silicon ingot pulling production scale, thus increasing raw material inventory to meet future production needs; second, intense industry-wide competition among downstream manufacturers, leading to slower inventory turnover; third, expansion of overseas sales business, which has longer delivery cycles compared to domestic sales.

Regarding questions about the company's future plans to reduce raw material costs, inventory amounts, and inventory turnover days, an inquiry was sent to the company's official email on the afternoon of August 21, but no response was received by publication time.