Tonghe Technology releases annual report; two shareholders consecutively reduce their holdings

On the evening of March 25, Tonghe Technology released its annual report for 2025. In 2025, the company’s operating revenue was 1.557 billion yuan, a year-on-year increase of 28.78%; the net profit attributable to shareholders of the listed company was 40.1533 million yuan, a year-on-year increase of 67.72%.

The list of the top ten circulating shareholders disclosed by the company as of the end of 2025 shows that compared to the end of the third quarter of 2025, individual shareholders Ren Xianwei and Yang Xiongwen reduced their holdings, decreasing by 1.0422 million shares and 996,200 shares respectively, after which their holdings were 6.3028 million shares and 1.7345 million shares respectively.

It is worth mentioning that the number of shares held by these two shareholders at the end of the third quarter of 2025 has also decreased compared to June 30, 2025.

According to Wind data, on March 26, Tonghe Technology’s stock price closed at 23.43 yuan/share, down 5.18%, with a latest market value of 4.1 billion yuan. Recently, the stock price has continued to decline, with a cumulative drop of 21.32% since March 11.

Company Sub-industry Gross Profit Margin Decline

The annual report shows that Tonghe Technology primarily engages in the research, production, sales, and services of power electronics industry products, with its main product core function being power conversion, widely used in charging and swapping equipment, grid equipment, aerospace special equipment, new energy heavy trucks, energy storage devices, etc., mainly covering three business areas: new energy, smart grid, and aerospace.

By industry segment, in 2025, the gross profit margin for the new energy sector was 17.21%, down 5.17 percentage points from 22.38% in the same period last year; the gross profit margin for aerospace and other industries was 45.4%, down 5.66 percentage points from 51.06% in the same period last year.

Regarding the decline in the company’s sub-industry gross profit margins, the company stated that, on one hand, with strong support from national policies, the development prospects of the new energy vehicle industry are broad, and competition in the market for charging power supplies for new energy vehicles and charging swap stations is fierce. On the other hand, the average gross profit margin in the aerospace sector is relatively high, and the gross profit margin for the company’s aerospace special power supply products is also at a high level. However, as more competitors enter the aerospace sector, the company faces the risk of declining gross profit margins for aerospace special power supply products.

At the same time, in various industries where the company’s products are applied, the downward trend in product prices due to competition will persist in the long term. In recent years, affected by the global economy and complex international situations, the prices of raw materials related to non-ferrous metals, such as magnetic components and printed circuit boards, have remained high for an extended period. In 2025, the company maintained long-term strategic partnerships with key suppliers to mitigate supply chain impacts, but market uncertainties exerted pressure on the company to maintain gross profit margin levels.

Regarding countermeasures, the company mentioned in its annual report that it will vigorously carry out research and innovation in core technologies, continuously optimize management, enhance operational efficiency, and continually launch high-value-added new products that meet market demand to maintain the relative stability of the company’s gross profit margin. Additionally, the company actively broadens its supply channels, takes multiple measures to improve supply chain management, and strengthens strategic cooperation with quality suppliers to respond to and reduce the impact of upstream supply chain factors on the company’s gross profit margins.

Significant Increase in Accounts Receivable

The annual report shows that as of the end of 2025, Tonghe Technology’s accounts receivable had a book value of approximately 952 million yuan, an increase of 30.40% compared to the beginning of the year.

The company stated that, on one hand, many of its key customers in the new energy and smart grid industries are well-known and reputable companies in the industry; however, if the future major customers are significantly affected by industry policies or operational conditions, there is still a risk that accounts receivable may not be collected in a timely manner as per contract agreements or may result in bad debts. On the other hand, although aerospace customers have good credit, the industrial chain and payment settlement cycle in the aerospace sector are generally long, and this business still faces risks of continuously increasing accounts receivable and delayed payments.

By the end of 2025, Tonghe Technology’s inventory had a book value of approximately 328 million yuan, an increase of 24.2% compared to the beginning of the year.

The company stated that this was mainly due to sales growth, expansion of production scale, and increased inventory reserves. As the company’s sales scale expands and safety stock increases, the inventory balance will continue to rise, which places higher demands on the company’s inventory management level. If the company’s inventory management level does not gradually improve with business development in the future, the growth in inventory will occupy a significant amount of working capital, leading to liquidity risks for the company. The company continues to implement the policy of “producing based on sales and maintaining safety stock,” enforcing strict warehouse management systems, purchasing management systems, and supplier management systems to ensure timely and stable raw material supply, fast and orderly turnover, and reasonable and effective inventory occupancy, striving to reduce liquidity risks arising from inventory occupation.

In 2025, the net cash flow from investment activities decreased by 45.85% compared to the previous year. The company stated that this was mainly due to increased investments in the industrialization construction project of high-power charging modules, and the research and production projects for power distribution systems and modules for data centers.

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