While the Feng Dengke case remains unresolved, an analysis of Haichen Energy Storage's performance reports reveals numerous financial risks hidden beneath this seemingly brilliant enterprise's facade.

More than two months after former Haichen Energy Storage executive Feng Dengke was detained by Ningde police, a letter allegedly from "Feng Dengke's wife" seeking help suddenly appeared online on September 15 and was widely circulated. The letter stated that she never imagined her honest husband would suddenly become embroiled in such turmoil, becoming a victim of malicious business warfare that would bring devastating disaster to their ordinary family.

Although the Feng Dengke case remains unresolved, analysis of Haichen Energy Storage's performance reports reveals numerous inconsistent financial risks hidden behind this seemingly brilliant enterprise.

**Overseas Transaction Concerns**

Haichen Energy Storage was established in 2019, focusing on energy storage batteries and systems as its core business, providing comprehensive energy storage solutions across all scenarios. By lithium-ion energy storage battery shipment volume, it ranked third globally in 2024 and second in the first half of 2025.

According to the prospectus, energy storage battery shipments reached 35.1GWh in 2024, with a compound annual growth rate of 167% from 2022 to 2024. Company revenue primarily comes from two major segments: energy storage batteries and energy storage systems, accounting for 61.6% and 36.2% of revenue respectively in 2024. Geographically, mainland China and overseas markets contributed 71.4% and 28.6% of revenue respectively.

Notably, Haichen Energy Storage achieved profitability in 2024, primarily benefiting from high gross margins in the North American market (42.3%), while domestic market gross margins were only 8.1%.

Despite this seemingly favorable situation, the authenticity of overseas market orders has raised questions. In August, Haichen Energy Storage attempted to downplay the impact of major overseas customer Powin's bankruptcy on its business through a statement that seemed evasive, forcing investors to reassess the authenticity of its transactions with Powin.

Questions about actual order quantities, whether revenue was inflated through credit sales, and similar orders where only cooperation agreements were signed without delivery have become puzzles for investors.

**Low R&D, High Patents**

Regarding R&D investment, while Haichen Energy Storage's absolute R&D spending continued to grow from 2022 to 2024, its R&D expense ratio declined year over year. Based on 2024 revenue estimates, the R&D expense ratio was only 4.1%, ranking last among the top six global energy storage companies, contrasting sharply with industry leaders CATL (5.14%), BYD (6.85%), and EVE Energy (5.6%).

Moreover, Haichen Energy Storage's R&D investment was even less than its administrative expenses, with cumulative administrative expenses of 2.153 billion yuan from 2022 to 2024, while cumulative R&D investment was only 1.212 billion yuan. This seems unreasonable for a company claiming to lead industry development through innovation.

Compared to industry leader CATL's 18.6 billion yuan R&D investment that year, Haichen Energy Storage invested only 530 million yuan in 2024. In the technology-intensive energy storage industry, this investment gap will directly impact product performance, cost control, and market share.

However, Haichen Energy Storage claims to have applied for over 4,400 patents globally, with the prospectus emphasizing "3,900+ patents approved and pending." But it combines "authorized" and "pending" disclosures without breaking down patent types and geographical structure.

Patent applications typically take an average of 18 months, making it shocking how Haichen Energy Storage, established less than six years ago, could accumulate so many patents so quickly.

In June 2025, CATL sued Haichen and its core personnel for "unfair competition," involving multiple Haichen Energy Storage executives (many former CATL employees), seeking approximately 150 million yuan in damages. This event puts Haichen Energy Storage's "innovation source" under a magnifying glass, and regardless of the lawsuit's outcome, it compels the market to verify the "source compliance" and "technological independence" behind its rapid patent accumulation.

**Cash Generation Concerns**

Haichen Energy Storage's revenue grew from 3.615 billion yuan in 2022 to 12.917 billion yuan in 2024, with a compound annual growth rate of 89%. However, profit attributable to owners was -1.77 billion yuan and -1.963 billion yuan in 2022 and 2023 respectively, only achieving 259 million yuan profit in 2024. Gross margins also increased from 11.3% in 2022 and 12.1% in 2023 to 17.9% in 2024.

However, Haichen Energy Storage's 2024 net profit turnaround is somewhat related to government subsidies, which amounted to 11 million yuan, 101 million yuan, and 414 million yuan from 2022 to 2024 respectively.

To achieve scale expansion, Haichen Energy Storage engaged in fierce price competition, with domestic market gross margins as low as 8.1%, significantly lower than CATL (22.94%), EVE Energy (16.19%), and energy storage system newcomer Hyperstrong (16.85%).

From average product pricing perspective, energy storage battery average prices plummeted from 0.8 yuan/Wh to 0.3 yuan/Wh from 2022 to 2024, a decline of 62.5%. Although overall gross margins improved in 2024, core product energy storage battery gross margins fell to only 9%.

Whether the company can achieve "self-sustaining cash generation" without subsidies and maintain growth rates without low-price strategies have become two major market concerns about Haichen Energy Storage.

**Surge in Accounts Receivable**

Haichen Energy Storage's trade receivables (net of impairment loss provisions) surged from 223 million yuan in 2022 to 8.31 billion yuan in 2024, a 37-fold increase over two years, accounting for 69.5% of revenue.

From 2022 to 2024, Haichen Energy Storage's third-party customer trade receivables were 223 million yuan, 4.14 billion yuan, and 8.97 billion yuan respectively, growing far beyond revenue growth multiples. Particularly in 2023 and 2024, receivables nearly doubled while revenue increased by only about 27%.

During the same period, the company's credit loss provisions for trade receivables reached 661 million yuan. The prospectus states that Haichen Energy Storage typically provides qualified customers with 1-6 month credit periods, but actual collection periods far exceed this range, with accounts receivable turnover days extending from less than 30 days in 2022 to nearly 200 days in 2024, showing significantly deteriorated collection capabilities.

Furthermore, the prospectus doesn't clearly disclose the contribution of top five/ten global customers to revenue or receivables. If there's high concentration on individual overseas large developers/system integrators, risks would be significantly amplified.

The surge in Haichen Energy Storage's accounts receivable may be due to overly aggressive credit policies adopted to capture market share, involving substantial credit sales.

Conversely, Haichen Energy Storage's trade payables, notes payable, and other payables in 2024 were 9.826 billion yuan, double the 4.502 billion yuan in 2023, showing the company is increasing payment period utilization from upstream suppliers.

Massive payables and receivables hang like a sword of Damocles over the company. If some receivables cannot be collected, Haichen Energy Storage would not only see profits significantly shrink but could also face cash flow risks.

**Heavy Financial Burden**

As of the end of 2024, Haichen Energy Storage's bank and other borrowings reached 9.983 billion yuan, with an asset-liability ratio of 73.1% and current ratio of 1.29, below the industry warning line of 1.5.

Financial costs increased from 64.73 million yuan in 2022 to 336 million yuan in 2024, equivalent to 2.6% of annual revenue, creating a heavy financial burden.

As of the end of 2024, Haichen Energy Storage had 4.294 billion yuan in cash and cash equivalents on its books, but bank and other borrowings were as high as 9.983 billion yuan. Additionally, restricted bank deposits surged to 2.321 billion yuan (from 854 million yuan in 2023), accounting for 54% of current cash and equivalents, meaning actually available cash is far below the reported figures.

If customer defaults or payment delays occur, Haichen could face urgent cash flow risks. Therefore, Haichen Energy Storage should disclose its funding source plans for the next 12 months to investors, including existing bank facilities, planned debt/equity issuance timelines, and contingency plans for acceptance, discounting, or bank tightening scenarios.