New stock outlook | RiMi Corporation: Leading in the photovoltaic silver paste industry, with a sharp increase in performance, still facing difficulties in breaking through the liquidity dilemma?

In recent years, the wave of photovoltaic companies rushing to list on the Hong Kong stock market has become increasingly intense. Recently, another photovoltaic player has joined the "reserve team" in the Hong Kong stock market. According to the Hong Kong Stock Exchange, on May 29, Jiangsu Riyu Photovoltaic New Materials Co., Ltd. (hereinafter referred to as Riyu Shares) submitted a listing application to the Hong Kong Stock Exchange Main Board, with Guotai Junan International as its exclusive sponsor. The prospectus shows that Riyu Shares is a leading global supplier of conductive photovoltaic silver paste. Based on revenue growth projections from 2022 to 2024, the company is ranked first among the top five photovoltaic silver paste manufacturers in the world in 2024; and fourth in revenue and sales in the global photovoltaic silver paste industry in 2024. The company's revenue and sales in the 2024 fiscal year respectively accounted for approximately 4.8% of the total revenue and sales in the global conductive photovoltaic silver paste industry. As of May 23, 2025, Guo Peng, Chairman of Riyu Shares, directly held 32.91% of the shares in Riyu Photovoltaic, while Wuxi Pengkun Limited Partnership, Wuxi Pengxin Limited Partnership, Wuxi Pengsheng Limited Partnership, and Wuxi Pengjie Limited Partnership respectively held approximately 12.89%, 9.67%, 1.10%, and 0.83% of the shares. Performance of the silver paste leader explodes, but cannot hide the hidden worries of "double highs". Riyu Shares was established in September 2015. With a decade of experience in the photovoltaic industry, the company is able to produce conductive photovoltaic silver paste used in various types of solar cells, including TOPCon cells, xBC cells, and PERC cells. Conductive photovoltaic silver paste is a specialized silver paste used in the production of solar cells, known for its high conductivity and low resistivity. Photovoltaic silver paste is used as the material for the front and back electrodes of crystalline silicon solar cells to collect and conduct the current generated by silicon-based solar cells. The company is mainly engaged in the manufacture and sale of TOPCon silver paste, xBC silver paste, and PERC silver paste. It is worth noting that the funds raised from the company's Hong Kong IPO will be used for investment in forward-looking technologies, including the development of TOPCon 5.0/6.0 metallization solutions, new generation N-type xBC cell metallization solutions, BC cell metallization solutions based on overlay technology, and low-temperature metallization solutions for HJT, HBC, and perovskite tandem solar cells. In terms of performance, Riyu Photovoltaic's revenue and gross profit have both experienced rapid growth. In 2022, 2023, and 2024 (referred to as the Reporting Period below), the company's revenue was RMB 393 million, RMB 1.594 billion, and RMB 2.285 billion, respectively, with a three-year compound growth rate of 141.3%; gross profit was RMB 37.46 million, RMB 179 million, and RMB 21.2 million; gross margin was 9.5%, 11.2%, and 9.3% respectively. Annual profit was RMB 8.77 million, RMB 59.659 million, and RMB 92.241 million, with a three-year compounded growth rate of 925.6%. The high growth in performance is mainly due to the rapid increase in the sales volume of the company's silver paste products. During the period, TOPCon silver paste quickly rose to become the revenue pillar of the company, contributing revenue of RMB 1.7 million, RMB 56.67 million, and RMB 1.601 billion respectively. The sales volume of this product during the period was 0.03 tons, 33.05 tons, and 241.7 tons respectively, with average selling prices of RMB 5,667/kg, RMB 5,590/kg, and RMB 6,624/kg. The increase in both volume and price naturally drove revenue growth. During the same period, the sales volume of xBC silver paste increased from 0.53 tons to 91.43 tons, with an average selling price increasing from RMB 4,747/kg to RMB 5,662/kg. It is worth noting that during the period, the revenue of the company's PERC silver paste significantly decreased, from RMB 0.36 billion in 2022 to RMB 0.137 billion in 2024, mainly due to the decrease in sales volume from 79.68 tons to 23.57 tons. It is believed that the change in the company's product structure is consistent with the trend of the industry. Currently, the mainstream PERC cells have approached their theoretical efficiency limit, limiting future cost reductions. Therefore, the focus of the photovoltaic industry is shifting to the new generation of N-type cells. Among them, TOPCon cells and N-type xBC photovoltaic cells have higher theoretical efficiencies than PERC cells. Therefore, TOPCon and N-type xBC cells are expected to become the most common N-type cells. It is estimated that by 2029, the shipment volume of N-type cells will reach 1,166.9 gigawatts, accounting for 95.4% of the global photovoltaic cell shipments. Guided by industry trends, Riyu Photovoltaic's PERC silver paste products naturally declined rapidly, while TOPCon silver paste quickly became the revenue pillar. Despite the explosive growth in performance, the company still cannot hide the high proportion of raw material costs and high customer concentration. Firstly, silver powder, glass powder, and organic materials are the main raw materials used by the company to produce its products. The cost of raw materials accounts for the highest proportion of Riyu Photovoltaic's sales costs. In 2022, 2023, and 2024, raw material costs were RMB 345 million, RMB 1.382 billion, and RMB 2.018 billion, respectively, accounting for 97.2%, 97.7%, and 97.3% of the total sales costs. The company stated in its risk warning that if the company is unable to purchase relevant raw materials from its preferred suppliers, it may have to purchase the raw materials at higher prices or delay the procurement of the materials. If the company cannot find any alternative sources of supply in a timely manner, its business, reputation, and operating performance may be adversely affected. Secondly, Riyu Photovoltaic is heavily dependent on large customers. During the period, the revenue generated by the company's top five customers was RMB 392 million, RMB 1.541 billion, and RMB 1.708 billion, respectively, accounting for 99.8%, 96.7%, and 74.8% of the total revenue. The high customer concentration leads to the company having high trade receivables. During the period, the company's trade receivables and bills were RMB 157 million, RMB 509 million, and RMB 958 million, respectively. The surge in trade receivables has led to the company not receiving real cash from its operating activities. During the period, the company's operating cash flow remained negative. From 2022 to 2024, the operating cash flow was RMB 126 million, RMB 128 million, and RMB 539 million. If the company's future operating cash flow cannot be improved to a level sufficient to meet its overall cash requirements, it will need to rely on external debt or equity financing, indicating that the company's move to Hong Kong for financing.Urgency of resources.Photovoltaic silver paste market is a trillion-dollar market It is worth noting that since 2024, the solar industry has been deeply trapped in overcapacity and price wars, but the silver paste track has shown structural opportunities. As the efficiency of PERC cells approaches the theoretical limit, the market share of N-type technologies such as TOPCon and xBC has risen from less than 20% in 2022 to 65% in 2024, driving the growth of high-performance silver paste demand. The marketization level of the photovoltaic silver paste industry is relatively high. With the continuous growth of global photovoltaic installations and the continuous iteration of photovoltaic cell technology, the long-term growth of photovoltaic silver paste as the core auxiliary material of photovoltaic cell slices has certainty. The global photovoltaic silver paste market has developed rapidly in the past few years, growing from 13.1 billion yuan in 2020 to 46.8 billion yuan in 2024, and is expected to further increase to 116 billion yuan by 2029, with a compound annual growth rate of 19.9% between 2024 and 2029. With the iterative update of photovoltaic module technology routes, silver paste will gradually shift from the PERC technology route to the TOPCon route, leading to an overall increase in unit price, and in the future, photovoltaic silver paste for XBC batteries and HJT batteries will dominate the market share. As China accelerates the pace of sustainable development, China has become a major source of global photovoltaic modules. Chinese photovoltaic silver paste manufacturers have gradually replaced international manufacturers in the market with technological upgrades and rapid response services, occupying a significant market share. At the same time, the sales volume of photovoltaic silver paste has grown rapidly from 28.5 thousand tons in 2020 to 75.4 thousand tons in 2024, and is expected to further increase to 167.3 thousand tons by 2029, with a compound annual growth rate of 17.3% between 2024 and 2029. In terms of competitive landscape, the solar industry has formed a relatively mature industrial chain after several years of development, and the photovoltaic silver paste industry has also formed a high degree of concentration in evolution, with the top five global photovoltaic silver paste manufacturers accounting for approximately 73.0% of the market share in terms of revenue. Riyoma ranks fourth among global photovoltaic silver paste manufacturers and has been the fastest growing company in photovoltaic silver paste revenue among the top five suppliers in the past three years. It is worth noting that the company still lags behind the top three significantly. In particular, the leading company's photovoltaic silver paste revenue in 2024 was 12.86 billion yuan, almost six times that of the company. In summary, currently, the market share of the top companies in the global silver paste market exceeds 70%, with giants such as Wuxi Dk Electronic Materials Co., Ltd. and Heraeus actively accelerating the layout of metal-induced technology. In comparison, Riyoma's 4.8% market share still needs to break through further. According to the company's development plan, Riyoma's next-generation technology will focus on low-temperature silver paste technology, silver-copper hybrid paste, and improving printing accuracy in three main directions. As the global photovoltaic installations move towards 800 GW, Riyoma may leverage the power of the capital market to further expand.