Does Sunwoda, owned by the richest man in Maoming, really lack money?

While spending 4 billion yuan on financial management, it has also launched an H-share financing. Is Sunwoda, under the "richest man in Maoming", Wang Mingwang's family, short of money?

With the disclosure of the Hong Kong stock prospectus, the real operating conditions of Sunwoda, the world's "king of mobile phone batteries", are about to be examined by top global investors.

01 Financial Concerns

On July 30, Sunwoda officially submitted a listing application to the main board of the Hong Kong Stock Exchange, with Goldman Sachs and CITIC Securities as joint sponsors. It has only been a month since the previous announcement of planning to list on the H-share market. It's quite fast.

The company stated that it launched the H-share listing application to deeply promote the globalization strategy, build an international capital operation platform, and enhance its international brand and comprehensive competitiveness.

In February this year, the company announced that it planned to invest no more than 4 billion yuan in financial management and no more than 300 million yuan of its own funds in securities investment. Two months later, Sunwoda participated in the placement of Honggong Technology, a new stock on the Science and Technology Innovation Board, buying a 0.85% stake in the latter for nearly 18 million yuan. Currently, this investment has a floating profit of 280%.

▲Source: Sunwoda's announcement

Honggong Technology is a supplier of automated lithium battery material processing production lines and equipment, and Sunwoda is one of its important customers. The capital alliance between upstream and downstream helps to strengthen the cooperation and synergy of the industrial chain and also brings considerable returns. It's a successful investment.

However, compared with the 4 billion yuan, the initial capital of less than 20 million yuan is just the tip of the iceberg. Being able to spend three times the annual net profit so generously shows that Sunwoda has a very abundant capital situation.

However, the actual situation is more complicated.

In the past 30 years, the lithium battery industry has gone through multiple cycles. In the long run, relying on the stable output of the consumer battery business, 28-year-old Sunwoda is definitely stable and has strong sustainability.

Sunwoda has never suffered a loss in the past 17 years (from 2008 to the first quarter of 2025). Its revenue scale has only decreased slightly twice, and its profitability (net profit attributable to the parent company) has been growing positively for the past 12 years. In 2024, the company's revenue exceeded 56 billion yuan, and its net profit attributable to the parent company increased by 36.43% to 1.468 billion yuan, both reaching record highs.

But since the transformation to power batteries, the company's financial situation has shown hidden concerns.

For example, at the end of 2024, its accounts receivable reached as high as 16.079 billion yuan, a year-on-year increase of 34.6%, far exceeding the 17.05% increase in operating income during the same period. The accounts receivable are even 11 times the net profit. In the first quarter of this year, the accounts receivable were 14.274 billion yuan, and the turnover days reached 111.15 days, the highest in 12 years. In the same period, the turnover days of CATL and EVE Energy were only 66.05 days and 91.1 days respectively.

▲Source: Sunwoda's financial report, Flush

The large scale of accounts receivable and the long collection cycle have greatly reduced the company's profit quality, indicating that it faces great pressure in collecting payments, has weak bargaining power in the industrial chain, and is far inferior to CATL. A large amount of funds are occupied by customers, increasing the risk of bad debts.

At the end of the first quarter of this year, Sunwoda had 10.752 billion yuan in cash on hand. However, the short-term borrowings in the same period were 10.297 billion yuan, a month-on-month increase of 1.625 billion yuan. It can be seen that the company's cash situation is not very sufficient.

In particular, Sunwoda Power has been frequently raising funds since its establishment. Previously, it has received more than 12 billion yuan in total from venture capital institutions such as IDG Capital, Source Code Capital, and Shenzhen Capital Group, as well as automobile manufacturers such as SAIC, NIO, XPeng, and Li Auto.

It can be seen that whether at the parent company level or in the power battery segment, Sunwoda's capital situation is not generous, and its room for debt maneuvering is limited.

02 Ice and Fire Intertwined

"Top three in China, top five in the world" is the vision of Sunwoda Power.

Under this concept, the Sunwoda Power segment has fallen into a negative cycle of losing blood on one hand and expanding aggressively on the other.

Riding on the wave of the new energy vehicle industry, Sunwoda Power has been soaring. By 2024, its power battery shipments reached 25.29 GWh, a year-on-year increase of 116.90%. Its installed capacity ranked tenth in the world (data from SNE).

▲Unit: GWh, Data source: SNE Research

In the first quarter of this year, the company's power business revenue was 3.3 billion yuan, a year-on-year increase of 20%. The total shipments were 6.8 GWh, including 4 GWh of power batteries and 2.8 GWh of energy storage batteries. In the first half of the year, the installed capacity was 9.07 GWh, ranking sixth in China, representing a second-tier manufacturer.

The increase in scale has boosted the revenue. In 2021, the revenue of Sunwoda's electric vehicle batteries was 2.933 billion yuan, accounting for less than 8%. In 2024, the revenue rose to 15.139 billion yuan, accounting for 27.02%.

In 2022, when the lithium battery industry was booming, Sunwoda ambitiously launched multiple projects. In March, it planned to invest 12 billion yuan to build a 30 GWh power battery project in Zhuhai. In the same month, it planned to invest 8 billion yuan in Shifang, Sichuan, to build a 20 GWh power battery and energy storage battery factory. In September, it joined hands with Dongfeng Group and planned to invest 12 billion yuan with a planned production capacity of 30 GWh. In the same month, it planned to invest about 21.3 billion yuan in Yiwu to form a total production capacity of 50 GWh for power batteries and energy storage batteries.

According to rough statistics, in 2022 alone, Sunwoda's investment planning in the power battery field exceeded 50 billion yuan, with a planned production capacity of 130 GWh.

In the fiercely competitive lithium battery track, CATL wins with technology and scale, BYD dominates the automotive industry with its vertical industrial chain, "the king of involution" CMG goes through a bloody path with price wars, and Gotion High-Tech hugs Volkswagen tightly.

Sunwoda stands out with differentiation. As the company's chairman Wang Wei said, "Although we still have a gap in scale, focusing on the research and innovation of fast-charging technology gives our products unique competitiveness in the market."

Sunwoda focuses on square aluminum shells and also layouts large cylindrical batteries, covering the BEV, PHEV (plug-in)/EREV (extended-range) power markets. It has launched "flash-charging" batteries for BEV and plug-in hybrid batteries for the EREV and PHEV markets.

Now, the company's HEV battery installed capacity has ranked first in the Chinese market for three consecutive years and is among the top three in the world. It is the largest hybrid vehicle battery supplier in China.

However, under the halo, Sunwoda's power battery business has accumulated a loss of 6.58 billion yuan in the past four years. In 2024, Sunwoda Power still had a loss of 1.587 billion yuan. It has become a huge drag on the listed company's market value and performance. While bringing great attention and performance volume to the company, it also makes its situation more embarrassing. The company's stock price has been halved from its historical high.

▲Source: Sunwoda's 2024 annual report

▲Source: WeChat public account "Lithium Battery Investment Research"

In July 2023, Sunwoda decided to spin off Sunwoda Power for listing, further reducing its shareholding ratio and gradually diluting its drag on the parent company.

In March of the same year, the company announced a planned private placement of 4.8 billion yuan. However, up to now, there is still no news about the spin-off, and the refinancing plan has been shelved. In April this year, two major projects with a total investment of 14 billion yuan (the intelligent hardware comprehensive production base project in Ningxiang and the 30 GWh power battery production base project) were stopped. In 2024, two investment projects in Chengdu and Zhuhai were also stopped.

Now, the entire lithium battery industry chain is facing the dilemma of overcapacity, and the involution competition is intensifying. In 2024, the product unit price of Sunwoda Power dropped to 0.6 yuan/Wh, and the gross profit margin decreased by 2.42 percentage points.

Launching the H-share refinancing, relying solely on a grand business plan to increase exposure , cannot cover up the reality of its weak value creation ability.

03

Return to the Hong Kong Stock Market

After two years of the capital winter, the Hong Kong stock IPO market is now extremely hot.

In just half a year, more than 40 new stocks have been listed on the Hong Kong stock market, raising more than 100 billion Hong Kong dollars in new stock financing. It has taken the top spot in global IPO financing, far surpassing NASDAQ across the ocean.

Some people joked that "the gongs at the Hong Kong Stock Exchange are not enough."

With CATL setting a good example in the power battery track, its current total market value in the Hong Kong stock market has exceeded HK$1.8 trillion. Especially with the reshaping of the valuation and pricing in the Hong Kong stock market, the discount of H-share valuations has not only been eliminated but has even exceeded that of A-shares. Since its listing, CATL's stock price has risen by more than 53% compared with the issue price (HK$263), also driving up the A-share price.

Under the demonstration of the capital effects of giants such as CATL, Hengrui Medicine, and Mixue Group, second-tier lithium battery companies have flocked to the Hong Kong stock market, and Sunwoda is one of them.

In 1997, the reform wave swept across the country. Wang Mingwang and his cousin Wang Wei founded Shenzhen Sunwoda Electronic Co., Ltd. The two brothers grasped the pulse of the times. They first entered the consumer battery field and successfully joined the Apple industrial chain through cooperation with ATL. With Apple's endorsement, Sunwoda became well-known. In April of the same year, the company was successfully listed on the Growth Enterprise Market.

Supported by both industrial strength and financial capital, Sunwoda entered the fast lane and soon became the "king of global mobile phone batteries."

In 2014, the company acquired Dongguan Liwei, thereby entering the battery cell field and achieving a full industrial chain layout from PACK assembly to battery cell manufacturing. Two years later, it officially entered the energy storage battery track. Currently, Sunwoda ranks among the top five global AC-side energy storage system suppliers (in terms of shipments).

According to the Hurun Rich List, in 2024, the Wang Mingwang family ranked 494th with a wealth value of 10.5 billion yuan, becoming the veritable "richest man in Maoming."

▲Source: Hurun Rich List

However, upon closer inspection, the company's profitability still relies heavily on the consumer battery business. Its gross profit margin has risen from 13.79% in 2022 to 17.65% in 2024. It is the mainstay of the company