--- title: "[IPO Watch] TRANSSION Passes HKEX Listing Hearing: How to Tell a New AI Story?" type: "News" locale: "en" url: "https://longbridge.com/en/news/300432746.md" description: "On September 25, TRANSSION disclosed its post-hearing information package, officially passing the listing hearing for the Main Board of the Hong Kong Stock Exchange, just one step away from issuing H shares. The company appointed CITIC Securities as the sole sponsor. As the \"King of African Mobile Phones,\" TRANSSION is advancing the construction of an \"A+H\" dual capital platform and is in a transition period towards smartphones and the Internet of Things (IoT), with performance expected to recover and grow in 2026" datetime: "2026-09-29T11:56:41.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/300432746.md) - [en](https://longbridge.com/en/news/300432746.md) - [zh-HK](https://longbridge.com/zh-HK/news/300432746.md) generator: "portal-rs" --- # [IPO Watch] TRANSSION Passes HKEX Listing Hearing: How to Tell a New AI Story? According to the HKEXnews website, on September 25, TRANSSION (688036.SH), the "King of African Mobile Phones" listed on the A-share market, disclosed its post-hearing information package. This indicates that the company has passed the listing hearing for the Main Board of the Hong Kong Stock Exchange (HKEX) and is just one step away from the issuance and listing of H shares. The post-hearing information package shows that the company has appointed CITIC Securities as the sole sponsor, JPMorgan as the financial advisor, and CICC, Haitong Securities, and Deutsche Bank also serving as financial advisors. TRANSSION is a provider of smart terminal products and mobile internet services, focusing on the design, R&D, production, sales, and brand operation of mobile phones. According to Frost & Sullivan, based on 2025 revenue, the company ranks eighth in the global mobile phone market with a market share of 1.7%. It owns three major mobile phone brands: TECNO (focusing on the mid-to-high-end segment), Infinix (targeting young consumers), and itel (emphasizing cost-effectiveness), earning it the title of "King of African Mobile Phones" in the market. The company's A shares were listed on the Growth Enterprise Market (GEM) in September 2019 (stock code 688036). After passing this hearing, if the H shares are successfully listed, it will form an "A+H" dual capital platform, adding another large-cap target to the consumer electronics sector of the Hong Kong stock market. **Mobile Phone Core Business Withstands Cyclical Tests, Growth to Restart in 2026** TRANSSION is currently undergoing a diversified transformation from feature phones to smartphones, from hardware to mobile internet services, and from mobile phones to IoT products. Short-term performance has fluctuated significantly due to the cyclical nature of memory chip prices and market competition, but signs of recovery have emerged in 2026. From 2023 to 2025, TRANSSION's revenues were RMB 62.3 billion, RMB 68.72 billion, and RMB 65.59 billion, respectively (currency: RMB, unless otherwise stated). Revenue increased by 10.3% year-on-year in 2024 but fell by 4.5% in 2025. In the first four months of 2026, revenue reached RMB 23.29 billion, a year-on-year increase of 30.1%. The company's revenue remains overwhelmingly driven by mobile phones: in 2025, mobile phone revenue was RMB 58.45 billion, accounting for 89.1% of total revenue, of which smartphone revenue was RMB 54.82 billion (83.6%); mobile internet service revenue was RMB 940 million (1.4%); and revenue from IoT products and others was RMB 6.2 billion (9.5%). In terms of regional structure, in 2025, revenue from the African market was RMB 24.75 billion (37.7%), and from emerging Asia-Pacific markets was RMB 23.9 billion (36.4%), together accounting for over 70%. The Middle East, Latin America, and Central and Eastern Europe accounted for 9.4%, 8.0%, and 5.4%, respectively. The company covers more than 100 countries and regions globally through over 2,900 distributors. In 2025, the revenue contribution from the top five customers was 13.4%, with the largest customer accounting for 3.1%, indicating a highly dispersed customer base. On the profitability front, the company's gross margin decreased from 23.2% in 2023 to 20.9% in 2024 and 18.7% in 2025, before rebounding to 21.9% in the first four months of 2026. Net profit for 2023, 2024, and 2025 was RMB 5.59 billion, RMB 5.6 billion, and RMB 2.61 billion, respectively, with the net profit margin dropping from 9.0% to 4.0%. In the first four months of 2026, net profit surged more than 120% year-on-year to RMB 1.361 billion. The decline in performance in 2025 was mainly due to rising procurement costs for memory chips. To cope with price hikes, the company slowed its shipment pace, resulting in a 9.1% year-on-year decrease in smartphone sales volume and a 23.9% decrease in feature phone sales volume. Intensified competition in Central and Eastern Europe also led to a 36.1% decrease in revenue in that region, while revenue in Latin America fell by 23.7%. Entering 2026, industry-wide price increases took effect, significantly improving the company's volume-price structure: in the first four months of 2026, smartphone sales volume was 27.252 million units. Although this represented a year-on-year decrease, the average selling price rose from RMB 538.8 per unit in the same period last year to RMB 705.5, an increase of over 30%, driving revenue back to double-digit growth. In terms of production and R&D, the company adopts a model combining internal production with ODM/OEM suppliers. As of September 17, 2026, it had six production bases in Chongqing, Shenzhen, Nanchang, Wuxi, Bangladesh, and Ethiopia. The capacity utilization rate for smartphones in 2025 was 82.3%. As of April 30, 2026, the company had been granted over 3,000 patents domestically and internationally (including more than 1,400 invention patents). R&D expenditure as a percentage of revenue increased from 3.6% in 2023 to 4.6% in the first four months of 2026, reflecting continued increases in investment. **Fundraising Heavily Bets on AI, Second Growth Curve Narrative Takes Shape** The use of proceeds from this H-share fundraising highlights the company's bet on new growth engines. The prospectus shows that the company intends to primarily allocate the raised funds to two main directions: AI-related technology R&D and marketing brand building. Among them, AI-related R&D covers four sub-segments: (i) Strengthening AI foundational capabilities, including investing in AI big data infrastructure, developing AI small language models tailored for emerging markets (covering localized languages and mixed-language communication), and enhancing AI chip capabilities to develop device-embedded AI features such as 3-billion-parameter small models and AI voiceprint recognition; (ii) Developing AI assistants and AI agents to support multimodal interaction and provide proactive services for emerging market scenarios such as multi-language, offline or hybrid connectivity, and localized tasks; (iii) Upgrading the proprietary TRANSSION OS by integrating AI into all levels of the operating system to achieve intelligent resource scheduling, enhanced power management, and personalized interaction; (iv) Strengthening AI imaging capabilities by developing AI imaging algorithms suitable for diverse lighting environments in emerging markets, and investing in key imaging technologies such as chips, sensors, and camera modules. The company also disclosed plans to collaborate with a top university in Shanghai on research covering frontier topics such as accelerating vision foundation models and identifying individual speakers in multi-person conversations. Regarding the second growth curve, the company's mobile internet services and IoT businesses have begun to scale. Mobile internet services rely on TRANSSION OS for monetization through app pre-installation, distribution, and advertising, generating revenue of RMB 940 million in 2025 with a gross margin as high as 80.0%, significantly superior in profit quality to the hardware business. Revenue from IoT products and others in 2025 was RMB 6.2 billion (9.5% of total), with gross margin rising from 18.1% in 2023 to 22.2% in the first four months of 2026. This segment covers categories such as laptops, tablets, smartwatches, TWS earphones, smart TVs, and kitchen appliances. Energy storage products (hybrid inverters, lithium battery modules, portable energy storage systems, and photovoltaic modules) also recorded revenue of RMB 360 million in 2025. **Risks and Observations** There are several points worth noting as TRANSSION makes its push for the Hong Kong stock market. First, pressure from memory chip costs persists: the proportion of memory chips in the company's cost of goods sold rose from 20.9% in 2023 to 28.0% in 2025, reaching 48.4% in the first four months of 2026. The company strategically increased purchases to lock in costs, causing inventory to rise from RMB 8.9 billion at the end of 2025 to RMB 17.755 billion at the end of July 2026, nearly doubling. If prices fall subsequently or demand falls short of expectations, there will be pressure from inventory impairment and cash flow occupation. Second, cash flow is under pressure: net cash flow from operating activities dropped from net inflows of RMB 11.85 billion in 2023 and RMB 2.79 billion in 2024 to RMB 135 million in 2025, turning into a net outflow of RMB 587 million in the first four months of 2026. Cash and cash equivalents at the end of the period decreased from RMB 11.12 billion at the end of 2025 to RMB 10.23 billion at the end of April 2026. Third, significant profit volatility: net profit in 2025 decreased by 53.5% year-on-year. The company warned that past financial performance may not indicate future results, and that revenue and net profit may decrease in the future. Fourth, compliance and geopolitical risks: The company's products are sold to several regions subject to sanctions by the United States, the European Union, or the United Nations. The company states that these sales do not constitute primary sanction activities, but export controls and geopolitical changes still need to be monitored. The company also warned that exchange rate fluctuations in emerging markets affect net other income. **Summary** For the Hong Kong stock market, TRANSSION is a rare "King of African Mobile Phones" target: its core mobile phone business contributes stable cash flow and high dividends (declaring dividends of RMB 2.62 billion in 2025, and annual dividends of RMB 1.04 billion and interim dividends of RMB 920 million in May and August 2026, respectively), while AI R&D investment and new businesses such as mobile internet, IoT, and energy storage provide valuation elasticity. Whether the company can smoothly launch its IPO, the pricing of its H shares, and whether the AI narrative can translate into incremental performance will be the key variables for the market to observe its journey in the Hong Kong stock market. ### Related Stocks - [02800.HK](https://longbridge.com/en/quote/02800.HK.md) - [03037.HK](https://longbridge.com/en/quote/03037.HK.md) - [03115.HK](https://longbridge.com/en/quote/03115.HK.md) - [07200.HK](https://longbridge.com/en/quote/07200.HK.md) - [07300.HK](https://longbridge.com/en/quote/07300.HK.md) - [07500.HK](https://longbridge.com/en/quote/07500.HK.md) - [00HSI.HK](https://longbridge.com/en/quote/00HSI.HK.md) - [688036.CN](https://longbridge.com/en/quote/688036.CN.md) - [03908.HK](https://longbridge.com/en/quote/03908.HK.md) - [600030.CN](https://longbridge.com/en/quote/600030.CN.md) - [DB.US](https://longbridge.com/en/quote/DB.US.md) - [JPM.US](https://longbridge.com/en/quote/JPM.US.md) ## Related News & Research - [Tepid response to Hong Kong listing of Africa’s top phone maker](https://longbridge.com/en/news/301630404.md) - [TRANSSION Prices IPO at Lower End of Offer Range at HKD35.3](https://longbridge.com/en/news/301638810.md) - [TRANSSION HOLDINGS Reportedly to Ignite HK IPO Pre-marketing Next Week](https://longbridge.com/en/news/300109765.md) - [Qualcomm Renews Patent License Agreement With Transsion Through 2031](https://longbridge.com/en/news/302038543.md) - [Q2 smartphone production down just 8% year-on-year, to 275 million units](https://longbridge.com/en/news/298298395.md) --- > **Disclaimer: This article is for reference only and does not constitute any investment advice.**