The 'Maoming's Richest' with a net worth of 11.5 billion rushes for Hong Kong IPO

Rushing to IPO in Hong Kong has become a standard move for lithium battery giants.

Following CATL and EVE Energy, the second-tier leader in power batteries, Sunwoda, is also aiming for a Hong Kong IPO.

According to relevant reports, Sunwoda has officially submitted an H-share listing application to the Hong Kong Stock Exchange.

Regarding the reason for listing in Hong Kong, Sunwoda explained that it is to accelerate the globalization of its business.

Sunwoda stated that in order to deeply promote the company's globalization strategy, build an international capital operation platform, enhance international brand image and comprehensive competitiveness, and assist the company's long-term development, the company plans to issue overseas listed foreign shares and apply for listing on the main board of the Hong Kong Stock Exchange.

Indeed, accelerating the globalization of its business is an important factor for its push to list in Hong Kong, but according to Kan Jian Finance's observation, alleviating financial pressure may be the fundamental reason for Sunwoda's listing in Hong Kong.

As a second-tier leader in power batteries, in recent years, in order to catch up with first-tier giants like CATL and EVE Energy, Sunwoda has accelerated its expansion. In just five years, its fixed assets have skyrocketed from 5.936 billion yuan in 2020 to 19.76 billion yuan in 2024.

However, the cost of accelerated expansion is increasing debt.

According to relevant data, as of the end of the first quarter of this year, Sunwoda's asset-liability ratio has risen to 64.59%, while in 2023, its asset-liability ratio was only 59.07%. The rapid rise in the asset-liability ratio has put Sunwoda under tremendous financial pressure, with its total liabilities currently reaching 58.34 billion yuan, and accounts payable and notes payable alone amounting to 25.17 billion yuan.

For Sunwoda, the funds raised from listing in Hong Kong can alleviate its financial pressure and give it the confidence to continue catching up with giants like CATL and EVE Energy.

However, in an increasingly competitive market environment, successfully listing in Hong Kong can only partially alleviate Sunwoda's financial pressure. To truly enter the "first-tier lineup," Sunwoda's journey is still long.

Financial reports show that Wang Mingwang and Wang Wei are the actual controllers of the company, currently holding 19.60% and 7.18% of the company's shares, respectively. According to the Hurun Global Rich List, in 2022, Wang Mingwang ranked 1187th globally with a net worth of 19 billion yuan, becoming the new "Maoming richest man." By 2025, Wang Mingwang's net worth had shrunk to 11.5 billion yuan, ranking 2295th globally.

Surviving in the Cracks

Public information shows that Sunwoda was founded in 1997, initially starting with the production of consumer lithium-ion battery modules.

In 1999, Konka Group, also based in Shenzhen, decided to enter the mobile phone industry. Sunwoda seized the opportunity to produce batteries that met Konka Group's requirements, thus establishing a cooperative relationship with them.

After securing orders from Konka Group, Sunwoda gradually became a supplier to mobile phone giants such as Apple, Huawei, and Xiaomi. By 2011, when Sunwoda went public on the Shenzhen Stock Exchange's Growth Enterprise Market, it had already become an invisible champion in the consumer battery field.

After successfully entering the capital market, thanks to the booming development of the consumer electronics market, Sunwoda's size rapidly expanded.

Financial reports show that at the beginning of its listing in 2011, Sunwoda's revenue was only 1.031 billion yuan, but by 2022, its revenue had grown to 52.16 billion yuan, with a compound annual growth rate of 42.86%. During the same period, Sunwoda's net profit also grew from 82.67 million yuan to 1.068 billion yuan, with a compound annual growth rate of 29.11%.

After entering 2023, the consumer electronics market began to peak and decline, and Sunwoda's pressure followed.

According to IDC statistics, global smartphone shipments in 2023 were 1.17 billion units, a year-on-year decrease of 3.2%. In addition, according to a report released by TechInsights, global tablet market shipments in 2023 were approximately 137 million units, a year-on-year decrease of 16%.

When the high growth of the consumer electronics market is no longer, Sunwoda's performance also begins to slow down.

In 2023, Sunwoda's revenue and net profit growth rates were -8.24% and 0.77%, respectively, marking the first time it encountered negative revenue growth since its listing. In 2024, performance growth rebounded, but revenue growth was still the lowest in nearly a decade (except for 2023).

In the context of a slowdown in the growth of the consumer electronics market, finding a second growth curve is urgent.

In fact, Sunwoda began laying out its power battery business as early as 2008, hoping to use it as a new performance growth point, but unfortunately, business progress has been slow. Currently, the power battery market has entered an "oligopoly market." From January to May 2025, the combined market share of the top three power battery installations in China, CATL, BYD, and CALB, reached 73.22%, and Sunwoda's name did not appear at the top of the list. In the entire year of 2024, Sunwoda's power battery installations were 18.8GWh, although a year-on-year increase of 74.1%, the market share was only 2.1%.

From the current perspective, Sunwoda has fallen into a "double-sided squeeze." On one hand, the consumer battery business, which is the basic market, although its profit margin level continues to improve after the price reduction of raw materials, revenue growth has significantly slowed down. In 2024, the revenue of this business was 30.41 billion yuan, while in 2023, the revenue of this business was 28.54 billion yuan. From this calculation, the revenue growth rate of the consumer battery business in 2024 was only 6.55%. On the other hand, although the power battery business, which is the second growth curve, is growing rapidly in size, its profitability is becoming weaker and weaker. In 2023, the gross profit margin of the "electric vehicle battery" business was 11.22%, but by 2024, it had fallen to 8.8%.

For Sunwoda, further expanding the business size of "electric vehicle batteries" is crucial. After all, the power battery industry is one that emphasizes scale. Only when the scale is achieved can Sunwoda have the possibility of further cost reduction, and this may also be an important reason for Sunwoda's pursuit of listing in Hong Kong.

Breaking Through the Dilemma

In recent years, the power battery business has become the focus of Sunwoda's development.

Data shows that in 2022 alone, Sunwoda reached the development or cooperation of multiple power battery projects.

For example, investing 12 billion yuan to build a 30GWh power battery project in the jurisdiction of the Zhuhai municipal government; signing a project investment agreement with the Shifang municipal government in Sichuan to invest 8 billion yuan to build a 20GWh power battery and energy storage battery production base; signing an investment agreement with the Yichang municipal government, Dongfeng Group, and Dongfeng Hongtai to plan to invest 12 billion yuan to expand power battery production; signing a power battery and energy storage battery project investment book of over 20 billion yuan with the Yiwu municipal government.

According to media statistics, in recent years, Sunwoda's investment in power battery expansion has exceeded 60 billion yuan, with a considerable investment scale.

After the rapid expansion of production capacity, Sunwoda's "electric vehicle battery" business size has significantly increased. Financial reports show that in 2021, the revenue of "automotive and power battery" was only 2.933 billion yuan; but by 2024, the revenue of "automotive and power battery" had grown to 15.14 billion yuan. In just three years, the revenue of Sunwoda's "automotive and power battery" business has increased more than fivefold.

However, behind the rapid expansion of business size, Sunwoda has also taken on heavy pressure. Financial reports show that in the first quarter of this year, Sunwoda's asset-liability ratio was 64.59%, with total liabilities of 58.34 billion yuan and liquidity liabilities of 41.61 billion yuan, of which short-term loans alone amounted to 10.3 billion yuan, and accounts payable and notes payable totaled as high as 25.17 billion yuan. It should be noted that in 2018, Sunwoda's asset-liability ratio was 71.12%, although the asset-liability ratio was higher than in the first quarter of this year, the total liquidity liabilities were only 11.49 billion yuan, short-term loans were only 2.5 billion yuan, and accounts payable and notes payable were 7.989 billion yuan.

After the rise in debt, Sunwoda's cash flow pressure is also increasing.

As of the first quarter of this year, Sunwoda's monetary funds were 20.01 billion yuan, and trading financial assets were 587.5 million yuan, totaling 20.5975 billion yuan. Although cash flow has increased compared to the fourth quarter of last year, the "monetary funds + trading financial assets" of 20.5975 billion yuan still cannot cover the 25.17 billion yuan of accounts payable and notes payable.

From the perspective of Sunwoda's debt and cash flow pressure, listing in Hong Kong can indeed bring significant help, as listing in Hong Kong can raise funds and effectively alleviate its financial pressure. However, the bigger challenge Sunwoda currently faces is the difficulty in expanding its size. The reason behind this has been mentioned above. Currently, the power battery industry has entered an "oligopoly market." From January to May 2025, the combined market share of the top three power battery installations in China, CATL, BYD, and CALB, reached 73.22%, and Sunwoda's ranking is not high. Moreover, the power battery market is one that emphasizes scale. If it cannot expand its size, it will be difficult for Sunwoda to make further progress.

In addition, in the "dual oligopoly" market environment, Sunwoda can only choose to take a differentiated route, focusing on square aluminum shell batteries while also laying out large cylindrical batteries, covering the BEV, PHEV (plug-in hybrid)/EREV (range-extended) power market downstream, and launching "flash charge" batteries for BEVs; for the EREV and PHEV markets, laying out plug-in hybrid batteries with a range of 100-300+ km.

Currently, Sunwoda's HEV installations have been the champion of the Chinese market for three consecutive years, making it the largest hybrid vehicle battery supplier in China. However, it is clear from the performance that the demand for batteries in hybrid vehicles is ultimately limited and cannot be compared with pure electric vehicles.

As mentioned at the beginning, in an increasingly competitive market environment, listing in Hong Kong can ultimately only alleviate Sunwoda's financial pressure, but to truly enter the "first-tier lineup," Sunwoda still has a lot to do. $SUNWODA(300207.SZ)