Jiangxi Hongban Technology Co., Ltd. (hereinafter referred to as "Hongban Technology") will have its IPO application reviewed by the Shanghai Stock Exchange listing committee on October 31. The company, which supplies circuit boards for well-known smartphone brands such as Honor, OPPO, and vivo, has accumulated over 7 billion yuan in revenue over three years. However, this success is overshadowed by environmental controversies, absolute family control, and performance concerns under a "volume-for-price" strategy.

As a PCB (Printed Circuit Board) manufacturer whose production processes include potentially polluting steps like electroplating and etching, Hongban Technology claims in its prospectus that it does not belong to a heavily polluting industry. This conclusion contradicts regulatory guidelines from 2014 that classify PCB production as high-pollution risk, and it also differs significantly from the general perception among industry peers.

Industry research indicates that PCB manufacturing has traditionally been considered a high-pollution sector, generating pollutants such as copper-containing wastewater, ammonia nitrogen, and volatile organic compounds (VOCs). However, Hongban Technology cites a 2013 document in its prospectus to define itself as a "non-heavily polluting" enterprise—a stance starkly contrasting with competitors like Shennan Circuits and Wus Printed Circuit, which openly acknowledge the industry's high-pollution nature and disclose detailed environmental measures.

Notably, China's Ministry of Ecology and Environment has explicitly listed PCB production as a high-pollution risk industry in its Comprehensive Environmental Protection Catalog since 2014.

Hongban Technology exhibits clear characteristics of a family-controlled business. Its actual controller, Ye Senran, indirectly holds 95.12% of the company's shares through a multi-layered ownership structure. Even after the IPO, the Ye family will retain 71.34% ownership, maintaining absolute control—a governance structure that raises concerns about fairness in related-party transactions.

During the reporting period, Hongban Technology engaged in multiple related-party transactions, including leasing properties from affiliates (paying 1.488 million HKD annually in rent) and purchasing accommodation and catering services from Dongyue Hotel (totaling 5.3747 million yuan over three years).

More notably, the company distributed substantial dividends—138 million yuan between 2022 and 2023, accounting for 56% of its net profit (246 million yuan) during the same period. Given the Ye family's 95%+ stake, approximately 131 million yuan flowed directly to them.

This aggressive dividend policy coincided with a sharp rise in short-term borrowings—from 226 million yuan at the end of 2023 to 379 million yuan by the end of 2024—raising investor skepticism about the rationale behind such "debt-funded dividends."

While Hongban Technology highlights revenue growth in its prospectus (from 2.205 billion yuan in 2022 to 2.702 billion yuan in 2024), the quality of this performance is questionable. Net profit fluctuated significantly, with a 25% year-on-year decline in 2023 despite revenue growth.

Critics argue that the company relies on a "volume-for-price" strategy to boost sales. The average price of its core HDI boards dropped 19.94% in 2023 and another 5.26% in 2024.

Additionally, Hongban Technology's R&D spending (4.56%-4.69% of revenue from 2022-2024) consistently lagged behind industry averages. Meanwhile, accounts receivable ballooned from 591 million yuan in 2022 to 873 million yuan in 2024, representing 34% of revenue—signaling weakening collection capabilities and casting doubt on the sustainability of its growth.