--- title: "Domestic PLC \"Little Giant\": Aote Technology's IPO Still Under Inquiry After One and a Half Years" type: "Topics" locale: "en" url: "https://longbridge.com/en/topics/43471317.md" description: "Aotuo Technology, a national-level specialized and sophisticated enterprise focused on the R&D and production of medium-to-large PLCs, had its application accepted by the STAR Market in March 2025, with responses to the second round of review inquiries disclosed on August 13, 2026. It has not yet reached the listing committee review stage, and the specific date for the meeting remains unclear. In terms of performance, the company's results have been commendable. According to the prospectus, revenue increased from 197 million yuan in 2023 to 318 million yuan in 2025, while net profit grew from 53.28 million yuan to 118 million yuan..." datetime: "2026-08-19T02:03:30.000Z" locales: - [en](https://longbridge.com/en/topics/43471317.md) - [zh-CN](https://longbridge.com/zh-CN/topics/43471317.md) - [zh-HK](https://longbridge.com/zh-HK/topics/43471317.md) author: "[朝阳资本论](https://longbridge.com/en/profiles/26763750.md)" generator: "portal-rs" --- # Domestic PLC "Little Giant": Aote Technology's IPO Still Under Inquiry After One and a Half Years Aotu Technology, a national-level specialized and sophisticated enterprise focused on the R&D and production of medium-to-large PLCs, had its application accepted by the STAR Market in March 2025, and filed its response to the second round of review inquiries on August 13, 2026. It has not yet entered the listing committee review stage, and the specific date for the meeting remains unclear. In terms of performance, the company's results have been noteworthy. The prospectus shows that revenue grew from 197 million yuan in 2023 to 318 million yuan in 2025, while net profit increased from 53.28 million yuan to 118 million yuan. The business is deeply tied to key infrastructure sectors such as water conservancy and hydropower, petroleum and petrochemicals, shipbuilding, and national defense, having participated in benchmark projects like the Three Gorges Hydropower Station renovation, the Eastern Route of the South-to-North Water Diversion hub upgrade, and the Qingdao Metro Line 4 BAS system. However, two core flaws are being repeatedly scrutinized by the exchange: First, with a market share of only 3.58%, its gross margin is more than 30 percentage points higher than the mainstream level of peers, nearly doubling it, raising doubts about the rationality of its high profitability; Second, accounts receivable as a percentage of revenue has climbed to 67.89%, with operating cash flow and net profit diverging continuously. The 27.01% compound annual growth rate (CAGR) of revenue barely exceeds the hard threshold of 25% for the STAR Market's innovation attribute evaluation, prompting close scrutiny of revenue quality and motives for scaling up. **Competition in the medium-to-large PLC track is intensifying** Aotu Technology's main business is programmable logic controllers (PLCs). This device is known as the "control brain" of the industrial sector. From single pieces of production equipment to control systems for basin-level water conservancy hubs, none can do without the logical scheduling of PLCs. The company has entered the medium-to-large PLC track, which has a higher technical barrier. This market has long been monopolized by foreign firms. According to the latest revised data from MIR Databank for 2026, the domestic market size for medium-to-large PLCs was 10.874 billion yuan in 2025. Foreign brands hold an absolute dominant position, with local manufacturers accounting for only 16.71% of the overall market share. Currently, the market has long presented a competitive landscape of "foreign dominance, domestic catch-up," with clear tier divisions. **The first tier consists of international top-tier manufacturers,** with Germany's Siemens as the absolute leader, followed closely by Rockwell Automation (US), Schneider Electric (France), Omron (Japan), and Mitsubishi Electric (Japan). These manufacturers，凭借 decades of technological accumulation, complete product ecosystems, and global customer validation bases, collectively account for about 80% of the domestic medium-to-large PLC market, holding pricing power and industry standard-setting authority in the high-end market. Siemens alone maintains a market share of over 40% year-round, with significant advantages. **The second tier is centered around leading local manufacturers,** mainly including Inovance Technology, Supcon Technology, Hollysys, Zhongdian Zhike, and Aotu Technology. Inovance Technology holds about 5% market share, ranking first among domestic manufacturers; Supcon Technology continues to increase its market share in large-scale PLCs for process industries; Hollysys possesses strong competitiveness in rail transit and nuclear power fields; Aotu Technology is gradually penetrating niche tracks such as water conservancy and hydropower, and national defense shipbuilding. Overall, domestic manufacturers still have significant gaps compared to international giants in terms of technological accumulation, breadth of product ecosystems, and global market coverage. However, they are leveraging policy dividends for autonomous controllability to gradually achieve import substitution and market share growth in their respective 深耕 advantage tracks. **Taking Aotu Technology as an example, based on its own research methodology, the company's market share in medium-to-large PLCs was approximately 3.58% in 2025, ranking among the top local brands, but still belonging to the second tier when viewed across the entire industry.** But problems arise from this. Aotu Technology, a latecomer with less than 4% market share, has a gross margin nearly twice the industry mainstream level. Is this reasonable? **Flaw One: Can high gross margins be maintained?** Why are gross margins so high? This is the most concerning financial doubt regarding Aotu Technology and the focus of both rounds of inquiries. The second round delved deeper into three dimensions: pricing logic, channel differences, and competitor comparisons. It is reported that from 2023 to 2025, the company's main business gross margins were 74.23%, 72.52%, and 75.64%, respectively. The gross margin for its core product, medium-to-large PLCs, has remained above 80% for years. (Changes in the company's gross margin data, source: prospectus) Horizontally comparing, the average comprehensive gross margin of A-share industry comparable companies Inovance Technology, Xinye Electric, and Hechuan Technology is only 32%-43%. Hechuan Technology previously disclosed historical gross margins for medium-to-large PLCs of no more than 60%, a gap of over 20 percentage points compared to Aotu Technology, which is extremely rare in the equipment manufacturing industry. **How can a company with less than 4% market share possess pricing power far exceeding that of industry leaders?** In the second round of inquiries, the exchange required the company to analyze the rationality of its high gross margins. Aotu Technology's explanation mainly has three points: First, products focus on sectors with extremely high requirements for safety and autonomous controllability, such as water conservancy, national defense, and shipbuilding, where customers have low price sensitivity; Second, PLCs account for only about 10%-15% of the value in the entire industrial control system, serving as core components at the control layer, making cost reduction a lower priority for customers; Third, medium-to-large PLCs have high technical barriers. As a pioneer in domestic substitution, the company enjoys a premium for technological scarcity, allowing pricing to benchmark against international brands. In plain language, this means **Aotu Technology's core control products specialize in fields with extremely strict requirements like national defense and water conservancy. Customers aren't short on money and don't bargain much, so products can be priced high; moreover, these items don't cost much in the 整套 equipment but are particularly critical, so no one would cut costs on them; additionally, the company's technological leadership allows its pricing to keep pace with foreign big brands.** While this explanation seems logically self-consistent, three questions remain to be resolved: First, why haven't companies like Supcon Technology and Inovance Technology, which also serve central state-owned enterprise clients, obtained such high gross margin premiums? The scale effects and brand power of industry leaders should translate into stronger pricing power. This inversion of commercial logic has not been fully explained. Second, the stark contrast of 逆势 growth during a downturn raises doubts about the authenticity and sustainability of the growth. In 2024, the domestic market size for medium-to-large PLCs declined by 25.5% YoY, with collective shrinkage in demand from three major downstream sectors—photovoltaics, lithium batteries, and metallurgy—as the core drag. Conversely, Aotu Technology's revenue from medium-to-large PLCs surged 逆势 by 33.9%, deviating from the industry trend. In other words, if the industry as a whole is sluggish, how can the company thrive independently? Aotu's explanation divides into two aspects: First, revenue is concentrated in key infrastructure fields with rigid demand, such as water conservancy and shipbuilding, with basically no overlap with cyclical downturn tracks like photovoltaics and lithium batteries; Second, policies for autonomous controllability are accelerating implementation, and the company is continuously replacing foreign stock shares 凭借 its first-mover advantage. However, the long-term validity of this growth logic still needs verification. The narrowing space for incremental investment in large-scale infrastructure is an objective trend. If order releases in traditional advantageous fields like water conservancy slow down later, and expansion into new tracks like metallurgy and new energy falls short of expectations, whether the company's high growth can continue will face substantial tests. Third, the industry competitive landscape is changing rapidly, and the sustainability of high gross margins awaits resolution. As head manufacturers like Inovance Technology and Hechuan Technology accelerate their layout in the medium-to-large PLC track, competition for domestic substitution is becoming increasingly fierce, and scarcity premiums will continue to narrow. There is major uncertainty as to whether the current high gross margin level can be maintained long-term. High gross margins themselves are not a problem, but how long can one that is nearly double the industry average be sustained? This requires sufficiently solid commercial logic to support it. At present, the persuasiveness of this logic still lacks substance. **Flaw Two: Revenue precisely hits the line, but cash flow continues to shrink** Generally speaking, corporate cash flow issues relate to the "quality" of profitability and are more relevant to the true operational health of the enterprise. At the end of each reporting period, the combined book balance of accounts receivable, contract assets, and other non-current asset contract assets for Aotu Technology were 78.4996 million yuan, 148 million yuan, and 216 million yuan, respectively. The proportion of current operating revenue rose sharply from 39.86% to 67.89%. In other words, for every 100 yuan of revenue realized by the company, nearly 68 yuan is booked as receivables, significantly higher than the 35%-50% average level of industry comparable companies. Correspondingly, **the post-period collection ratio for accounts receivable at the end of 2025 was only 30.71% within 6 months, with collection cycles continuously lengthening and bad debt risks accumulating.** The direct consequence of high receivables is the continuous deterioration of cash flow. In 2023, net cash flow from operating activities was 64.6609 million yuan, corresponding to a net profit of 53.2819 million yuan, with a net profit-to-cash-flow ratio of 1.21. By 2025, operating cash flow dropped to 53.8916 million yuan, while net profit increased to 118 million yuan, causing the ratio to nearly halve to 0.46, presenting typical characteristics of "booked profitability but weak cash flow." Additionally, worth noting is the "precision" of revenue growth. From 2023 to 2025, the company's revenue CAGR was 27.01%, while **the STAR Market's innovation attribute evaluation standard requires "a compound annual growth rate of operating revenue of no less than 25% over the most recent three years."** It exceeds this by only 2 percentage points, hitting the timing and value with extreme precision. 叠加 the characteristics of significantly increasing accounts receivable and clearly lengthened credit cycles, the market cannot help but question: **Is the company relaxing credit policies and overdrawing future orders to boost current operating scale, merely to cross the hard threshold of the innovation attributes?** The exchange also focused on penetrating verification in the second round of inquiries: requiring the company to explain whether the significant revenue growth possesses commercial substance. Aotu Technology responded that downstream customers are mainly central state-owned enterprises, local state-owned enterprises, and system integrators. Internal payment approval processes are long, and project-based settlement cycles are inherently lengthy, which is an industry characteristic. Credit policies did not undergo major changes during the reporting period. Revenue growth resulted from increased downstream demand under the trend of domestic substitution, possessing a real commercial background. But the objective fact is that against the backdrop of overall industry pressure, the company's receivables growth far exceeded revenue growth, with severe divergence between cash flow and profits. If downstream customer payment rhythms slow down further, not only will bad debt risks rise, but the company's own working capital will also face greater pressure. Furthermore, in-hand orders at the end of 2024 had declined 18.19% YoY. Although there was a recovery in 2026, order instability means the sustainability of long-term growth still needs verification. Objectively speaking, as a representative enterprise in the domestic medium-to-large PLC track, Aotu Technology's technological accumulation and industrial value are worthy of affirmation, and the narrative of autonomous controllability aligns with national strategic directions. However, the capital market tests the authenticity of financial data and the sustainability of operational quality. Abnormal gross margins, weakening cash flow, and precisely timed revenue growth rates—these core doubts, although answered in the second round of inquiries, have not completely dispelled market concerns. The second round of replies is just an intermediate node in passing the inspection; the real test lies ahead. Source: Chaoyang Capital Theory ### Related Stocks - [6645.JP](https://longbridge.com/en/quote/6645.JP.md) - [300124.CN](https://longbridge.com/en/quote/300124.CN.md) - [688320.CN](https://longbridge.com/en/quote/688320.CN.md) - [SIE.DE](https://longbridge.com/en/quote/SIE.DE.md) - [SIEGY.US](https://longbridge.com/en/quote/SIEGY.US.md) --- > **Disclaimer: This article is for reference only and does not constitute any investment advice.**