Sieyuan Electric has submitted a listing application to the Hong Kong Stock Exchange. The announcement has sparked questions as the company recently reported its strongest financial performance to date.
Financially, Sieyuan Electric achieved revenue of 21.2 billion yuan in 2025, with net profit surging 54% year-on-year to 3.16 billion yuan. The company maintains ample cash reserves and demonstrates robust performance across its business segments, indicating strong financial health.
However, a closer look at the financial statements reveals an interesting detail: while profits increased, cash flow from operating activities declined by 9.5% year-on-year.
A significant factor behind this trend is the company's energy storage business. In 2024, Sieyuan Electric signed a major memorandum of understanding with CATL for 50 GWh of energy storage cooperation. If fully realized, this partnership could generate approximately 20 billion yuan in annual revenue, equivalent to 94% of Sieyuan's total revenue in 2025.
Yet, the energy storage sector requires substantial upfront investment for production line construction, capacity expansion, and capital funding before returns materialize. In the first three quarters of 2025, Sieyuan's energy storage business contributed 805 million yuan in revenue, accounting for 5.8% of total revenue but showing impressive growth momentum.
Beyond energy storage, larger opportunities lie in grid investment. During the "16th Five-Year Plan" period, State Grid's fixed asset investment is projected to reach 4 trillion yuan, a 40% increase from the previous period. In 2025, State Grid's bidding for transmission and transformation equipment totaled 68.19 billion yuan, up 23% year-on-year. Sieyuan Electric secured 4.81 billion yuan in contracts, a 73% increase.
Overseas expansion is also accelerating. In the first three quarters of 2025, international revenue accounted for 30.3% of total revenue, with the company entering supply chains for top European grid operators.
Looking further ahead, AIDC (AI Data Centers) represents the next growth frontier. Supercapacitors, produced by Sieyuan's subsidiary XJ Energy, address high-power demands in data centers. Pilot applications began in 2025, with scaled adoption expected in 2026. The company has reported increasing orders from North America driven by data center demand and strengthened cooperation with industry leaders like Delta Electronics.
Founded in 1993 by Dong Zengping, a Shanghai Jiao Tong University graduate, Sieyuan Electric has grown into a global enterprise operating in over 100 countries, with a market capitalization exceeding 170 billion yuan. The 56-year-old founder holds approximately 16.8% of shares, making him the largest single shareholder. The company maintains a highly stable management team, which is uncommon among A-listed private firms.
Sieyuan's business spans six segments: switchgear, transformers, protection and automation, power electronics, energy storage and components, and EPC. Switchgear contributed 41.5% of revenue in the first three quarters of 2025, followed by transformers at 23.8%.
Nevertheless, challenges persist. Trade receivables reached 8.085 billion yuan by the end of the third quarter of 2025, with days sales outstanding extending from 126 to 138 days. Goodstood at 541 million yuan, primarily from acquisitions such as supercapacitor businesses. In 2023 and 2024, the company recorded goodwill impairment losses of 113 million yuan and 107 million yuan, respectively, due to uncertainties in the financial performance of supercapacitor operations.
The Hong Kong IPO is viewed by some as a move to secure additional funding despite strong finances, while others see it as a step toward internationalization. A more accurate interpretation may be that Sieyuan is strengthening its position during an industry upcycle. Energy storage, overseas expansion, and AIDC development all require capital. While the A-share market supports domestic financing, an H-share listing opens international capital channels, providing a more stable foundation for growth.
Having led the company for 33 years, Dong Zengping has witnessed multiple technology transitions. The Hong Kong listing essentially provides an additional strategic advantage. With a 50 GWh energy storage order and industry opportunities at hand, securing funding and building capacity are critical to capturing market share. The monetization of supercapacitor technology remains a future goal, but securing strategic resources now is a prudent move.
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