New Stock News | Tiandi and Xingdi Express Top the Chinese Industrial Cybersecurity Market in 2024 according to Hong Kong Exchange.

According to the disclosure of the Hong Kong Stock Exchange on January 30th, Beijing Tian Di He Xing Technology Co., Ltd. (hereinafter referred to as Tian Di He Xing) has submitted its listing application to the main board of the Hong Kong Stock Exchange, with China Securities Co., Ltd. International and Orient International as its joint sponsors. According to Frost & Sullivan data, based on market share, the company ranked first in the Chinese industrial cybersecurity market in 2024, with an overall market share of approximately 6.7%, particularly with a market share of about 8.4% in the energy sector of the Chinese industrial cybersecurity market. Company Introduction The prospectus shows that Tian Di He Xing was established in August 2007 and is a well-known provider of industrial cybersecurity and energy digitization solutions in China. With the company's industry-specific technology and regulatory knowledge, Tian Di He Xing provides customized solutions to meet the diverse and evolving needs of enterprise users in various industries, protecting their information technology and operational technology assets (including networks, systems, data, applications, and devices) from attacks throughout the industrial production process, and effectively defending against security threats such as network attacks, disruption, and unauthorized access. The company uses AI-driven technology to enhance the security capabilities of enterprise users in different industrial scenarios. In addition to providing comprehensive industrial cybersecurity solutions, the company also offers digitization solutions for enterprise users in the energy sector, with core capabilities in real-time status perception, early risk warning, and process optimization. Since its establishment and up to the last practicable date, Tian Di He Xing has provided industrial cybersecurity solutions for over 6,000 projects. The company's solutions cover various industries such as power, petrochemical, rail transit, smart manufacturing, metallurgy and mining, municipal water supply, with over 200 application scenarios. The enterprise users the company serves represent over 50% of the approximately 100 core central state-owned enterprises supervised by the State-owned Assets Supervision and Administration Commission of the State Council. In the fiscal years ending in 2023, 2024, and the first nine months ending September 30, 2025, state-owned enterprises or state-controlled enterprises accounted for 69.3%, 69.7%, and 80.8% of the company's revenue contributions from enterprise users who used the company's solutions. By leveraging its deep technical expertise and customized solutions, the company has established close cooperation relationships with well-known state-owned enterprises and other government-owned enterprises, maintaining project service relationships with them throughout the prior periods. For the fiscal years ending in 2023, 2024, and the first nine months ending September 30, 2025, state-owned enterprise users who used the company's solutions in their projects for three consecutive years or more accounted for 57.5%, 54.3%, and 70.5% of the company's revenue contributions, respectively. This indicates high customer satisfaction, affirming the company's professional competence and strong project execution capabilities. Tian Di He Xing has built a one-stop product and solution matrix to meet the core needs of industrial cybersecurity. This matrix, based on modular design concept and supported by a unified platform architecture, can flexibly combine and deeply integrate into enterprise users' specific business scenarios. It covers the entire value chain from security protection, intelligent operation and maintenance to reliable power supply, enabling the company to provide customizable, highly reliable comprehensive value delivery for various industries. Financial Information Revenue In the fiscal years ending in 2023, 2024, the first nine months ending September 30, 2024, and the first nine months ending September 30, 2025, the company realized revenues of approximately RMB 474 million, RMB 727 million, RMB 359 million, and RMB 439 million, respectively. Gross Profit and Gross Margin In the fiscal years ending in 2023, 2024, the first nine months ending September 30, 2024, and the first nine months ending September 30, 2025, the company recorded gross profits of approximately RMB 289 million, RMB 366 million, RMB 172 million, and RMB 213 million, with corresponding gross margins of 60.9%, 50.4%, 47.8%, and 48.6%, respectively. Annual/Periodic Losses and Total Comprehensive Expense In the fiscal years ending in 2023, 2024, the first nine months ending September 30, 2024, and the first nine months ending September 30, 2025, the company incurred annual/periodic losses and total comprehensive expenses of approximately RMB 193 million, RMB 45.691 million, RMB 103 million, and RMB 94.672 million, respectively. Industry Overview The overall size of the Chinese industrial cybersecurity market has maintained stable growth. In 2020, the market size was RMB 4.43 billion, which had risen to RMB 9.6 billion by 2024, with a compound annual growth rate of 24.2% from 2020 to 2024. Looking ahead, it is estimated that the market size will reach RMB 29.4 billion by 2029, with a projected compound annual growth rate of 25.0% from 2024 to 2029. In terms of submarkets, the energy sector industrial cybersecurity market reached RMB 1.8 billion in 2020, increasing to RMB 4.4 billion by 2024, with a compound annual growth rate of 24.7% from 2020 to 2024. It is expected to reach RMB 11.7 billion by 2029, with a projected compound annual growth rate of 21.7% from 2024 to 2029, showing a steady expansion trend. The industrial cybersecurity market in the smart manufacturing sector reached RMB 400 million in 2020, rising to RMB 1.3 billion by 2024, with a compound annual growth rate of 26.2% from 2020 to 2024. With the driving force of emerging sectors, this market is expected to grow at a compound annual growth rate of 30.7% from 2024 to 2029, reaching RMB 5 billion by 2029. The industrial cybersecurity market in the rail transit sector reached RMB 1.3 billion in 2024. It is expected to reach RMB 5 billion by 2029, with a projected compound annual growth rate of 30.3% from 2024 to 2029, maintaining a steady growth trend. The industrial cybersecurity market in the Chinese energy sector covers the power grid and oil and petrochemical sub-industries, which have continued to expand. Overall, the market size was RMB 1.8 billion in 2020, soaring to RMB 4.4 billion in 2024, with a compound annual growth rate of 24.7% from 2020 to 2024. It is expected to reach RMB 11.7 billion by 2029, with a projected compound annual growth rate of 21.7% from 2024 to 2029. Specifically, in 2020 and 2024, the market size for the power grid industry was RMB 1 billion and RMB 2.4 billion, respectively. It is expected to reach RMB 6.2 billion by 2029, with a compound annual growth rate of 20.7% from 2024 to 2029. The oil and petrochemical industry has shown more significant growth, with its market size increasing from RMB 800 million in 2020 to RMB 1.9 billion in 2024. The compound annual growth rate from 2020 to 2024 was 25.6%, and it is expected to reach RMB 5.4 billion by 2029. The compound annual growth rate from 2024 to 2029 is projected to be 22.9%. In recent years, with the deepening of the "dual carbon" goals and the accelerated construction of new power systems, the energy industry is experiencing an unprecedented technological revolution. At the same time, backup power solutions designed for industrial scenarios, special environments, and green transformation needs, along with their integrated intelligent management systems, are experiencing continuous market demand growth due to their strong alignment with industry priorities such as power reliability, low-carbon operations, and energy efficiency. Digital transformation has become the core engine driving industry upgrade. The market size of comprehensive energy digitization solutions in China has steadily increased from RMB 17.2 billion in 2020 to RMB 47.6 billion in 2024, with a compound annual growth rate of 17.4% from 2020 to 2024. It is estimated to reach RMB 118.2 billion by 2029, with a projected compound annual growth rate of 22.9% from 2024 to 2029, demonstrating strong growth momentum. This trend not only reflects the dual drive of policy guidance and market demand but also highlights the urgent desire of energy enterprises to reduce costs, improve operational efficiency, achieve green low-carbon transformation, and intelligent operations. Board Information The board of directors is the company's principal decision-making body, responsible for formulating basic business strategies and policies to manage and operate the company's business, and oversee their implementation. After the IPO, the board of directors will consist of 11 directors, including 3 executive directors, 4 non-executive directors, and 4 independent non-executive directors. The initial term of office for all executive directors, non-executive directors, and independent non-executive directors of the company is three years, and may be re-elected and/or reappointed for subsequent terms. Ownership Structure Mr. Wang Xiaodong holds a 21.99% stake, the employee incentive platforms Tianjin Xingyuan and Tianjin Xinghui hold 9.54% and 3.38% stakes respectively, and pre-IPO investors collectively hold 65.09% of the shares. As of the last practicable date, Mr. Wang held 17,105,685 shares. Mr. Wang is a general partner of Tianjin Xingyuan. Under the Securities and Futures Ordinance, Mr. Wang is considered to own the equity interest of 7,418,080 shares held by Tianjin Xingyuan. Tianjin Chichuang (a company wholly owned by Mr. Wang) is the executive partner of Tianjin Xinghui. Under the Securities and Futures Ordinance, Mr. Wang is considered to own the equity interest of 2,631,579 shares held by Tianjin Xinghui. Intermediary Team Joint Sponsors: China Securities Co., Ltd. (International) Finance Limited, and Orient Finance (Hong Kong) Limited Reporting Accountants and Independent Auditors: Deloitte Touche Tohmatsu Company Legal Advisors: Regarding Hong Kong and U.S. law: Akin Gump Strauss Hauer & Feld LLP; Regarding Chinese law: JunHe LLP Joint Sponsors Legal Advisors: Regarding Hong Kong law: King & Wood Mallesons; Regarding Chinese law: King & Wood Mallesons Industry Consultant: Frost & Sullivan Compliance Advisor: May Shi Capital Limited