New stock forecast | Green-Sheng: Holding 9.8% global market share of cutting machines, still difficult to break the high account receivable predicament?

As the global lithium battery industry transitions from a competition based on scale to a stage of refined competition with "yield, efficiency, and cost" at its core, the mid-end equipment that determines the core performance of battery cells has become a key factor in the industry chain. At a critical point in the industry's evolution, Shenzhen Greensea Technology Co., Ltd. (referred to as "Greensea"), which has been deeply involved in mid-end lithium battery equipment for 17 years, officially submitted its application for IPO to the Hong Kong Stock Exchange on May 15th, with South China Financing Limited as its exclusive sponsor. Greensea plans to raise funds primarily for capacity expansion, core technology research and development, advancing strategic initiatives, and supplementing working capital. Top Supplier of Mid-End Equipment for Lithium Batteries According to the prospectus, Greensea was founded in 2009 and is one of the leading market participants in the global intelligent equipment industry for lithium-ion battery mid-ends. The company focuses on the research, development, and manufacturing of stacking technology and equipment for the new energy battery industry, especially for serving lithium-ion battery manufacturers in China and overseas. Greensea Technology provides fully automated equipment solutions for core mid-end manufacturing processes, focusing mainly on lithium-ion battery manufacturing and assembly equipment, including: the cutting stage, which involves the research and manufacturing of laser cutting machines; the stacking stage, which includes the research and manufacturing of various types of stacking machines, ranging from single to multi-tasking stacking machines; the company also engages in the research and manufacturing of cutting and stacking integrated machines; the winding stage, which includes the research and manufacturing of square cell and cylindrical cell winding machines; the injection stage, which includes the research and manufacturing of various types of injection machines for square, cylindrical, and pouch cells; and the production of automated conveyor lines and other equipment purchased by customers. In 2025, cutting machines accounted for 58.7% of the company's revenue, injection machines and winding machines accounted for 15.9% and 19.4% of revenue respectively. Greensea Technology is well-known for its high-speed stacking technology and has continuously achieved industry breakthroughs in stacking speed, such as increasing the efficiency of stacking from 0.6 seconds per piece in 2016 to 0.1 seconds per piece as of the most recent feasible date. The company's stacking machines use various proprietary stacking technologies tailored specifically for prismatic and pouch cell production, ensuring minimal battery variation, high consistency, and efficient automated manufacturing. During the historical period, the company's customers included nine of the top ten lithium-ion battery manufacturers (based on shipment volume) globally by 2025. These relationships are based on high entry barriers, strict and lengthy certification processes, and strict requirements for product safety and reliability. The company has five production facilities located in Shenzhen and Jiangmen in Guangdong Province, Huangshan in Anhui Province, and Xiaogan in Hubei Province, with a total building area of over 60,000 square meters. According to a Frost & Sullivan report, based on revenue for the 2025 fiscal year, the company ranks second among global lithium-ion battery cutting and stacking machine providers, with a market share of approximately 9.8% of global total revenue; and ranks fourth among global intelligent equipment providers in the mid-end of the lithium-ion battery industry, with a market share of approximately 5.7% of global total revenue. Turning Loss into Profit, High Receivables In terms of performance, in the fiscal years 2023, 2024, and 2025, Greensea achieved revenues of approximately RMB 1.165 billion, RMB 1.155 billion, and RMB 1.221 billion respectively; corresponding gross profits of approximately RMB 176 million, RMB 204 million, and RMB 208 million respectively, with gross profit margins of 15.1%, 17.6%, and 17.1% respectively; net profits of approximately -RMB 16.844 million, RMB 17.572 million, and RMB 48.235 million respectively. According to the prospectus, the company was able to achieve a turnaround from loss to profit and sustained growth during the industry adjustment cycle, mainly due to three factors: first, the profitability of core products improved, with the sales gross margin of cutting and stacking machines increasing from 10.4% in 2023 to 18.2% in 2025. In 2025, the increase in revenue after completing the equipment acceptance process for cutting and stacking machines led to a nearly 20 percentage point increase in their share of revenue to 58.7% year-on-year. Second, cost control measures were effective, with overall sales expenses, management expenses, and research and development expenses remaining stable. It is worth noting that, while improving performance, Greensea also faces the common challenges of high receivables and customer concentration in the lithium battery equipment industry. Data from the prospectus shows that as of the end of the fiscal years 2023 to 2025, the company's accounts receivable balances were approximately RMB 436 million, RMB 602 million, and RMB 530 million, accounting for approximately 16.1%, 26.2%, and 27.1% of total current assets respectively, with accounts receivable turnover days of 116 days, 169 days, and 169 days respectively, indicating a generally long cash collection cycle. If downstream industry cyclic fluctuations lead to a slowdown in the production expansion pace of core customers, or if there is a significant adverse change in customer operations, the company may face the risk of delayed accounts receivable collection or bad debts, which could have an adverse impact on its cash flow and operational performance. The core reason for the high accounts receivable is due to the industry's business model and customer structure: on one hand, lithium battery equipment follows an "order-based production, installment payment" model. According to the prospectus, Greensea's customers in the lithium-ion battery intelligent equipment industry typically pay approximately 30% of the total contract price upon signing the sales agreement, another 30% after passing the Factory Acceptance Test (FAT), Another 30% after passing the Site Acceptance Test (SAT), and the remaining 10% within 30 days after the end of the 12-month warranty period. Therefore, as some cash inflows are deferred to later stages of the project cycle, while research and development, raw material, and component procurement, production activities, and project execution require funds early in the process, there may be a mismatch between cash inflows and outflows. On the other hand, Greensea's customer concentration is relatively high. During the historical period, revenues from the company's top five customers accounted for approximately 57.3%, 53.8%, and 72.2% of total income each year respectively; and sales to the company's largest customer accounted for approximately 25.8%, 20.1%, and 35.3% of total revenue each year respectively. Downstream lithium battery manufacturers generally hold a strong position, have strong bargaining power, and therefore have a generally long payment period. A Bright Future for Mid-End Equipment in the Lithium Battery Industry Despite facing challenges of high accounts receivable and customer concentration, Greensea operates in a lithium mid-end equipment track that is expected to experience long-term growth, driven by expanding downstream demand and technological upgrades opening up industry growth space. According to a Frost & Sullivan report, the global new energy battery industry is experiencing rapid growth and has become an important support for global energy transformation and new industrial systems, with lithium batteries accounting for over 90% of global new energy battery shipments. By 2030, global lithium battery shipments are expected to reach 6,572.1 GWh, with a CAGR of 23.6% from 2025 onwards. China remains the world's largest market for intelligent lithium battery equipment, with the market size expected to grow from RMB 36.9 billion in 2025 to RMB 85.2 billion in 2030. At the same time, significant growth is expected in the European and North American markets, with expected CAGRs of approximately 27.7% and 25.5% from 2025 to 2030. The mid-end link directly affects the stability of battery structure, energy density, and product yield, making it a key link in the lithium battery manufacturing process with high technological barriers and concentrated value. In 2025, mid-end intelligent equipment accounted for approximately 34% of the global lithium battery intelligent equipment market. With the upgrade of high-energy density battery technology, the scale expansion of energy storage and power battery production lines, and the continuous improvement in production efficiency and yield requirements by battery companies, the demand for mid-end intelligent equipment is expected to continue to grow. The global market size of mid-end intelligent equipment for lithium batteries is expected to increase from RMB 21.5 billion in 2025 to RMB 64.6 billion in 2030, with a CAGR of 24.6% during the period. In terms of equipment types, cutting and stacking machines, winding machines, and injection machines constitute the core equipment system for the mid-end segment. Currently, power lithium batteries still use winding technology mainly, however, as power batteries evolve towards thinning and higher energy density, cutting and stacking machines are expected to grow rapidly. The global market size of lithium battery cutting and stacking machines is expected to increase from RMB 7.3 billion in 2025 to RMB 29 billion in 2030, with a CAGR of approximately 31.8%, outpacing winding machines. The global market size of winding machines and injection machines is expected to grow to RMB 17.4 billion and RMB 8.2 billion by 2030 respectively. The rapid growth of the mid-end equipment track for lithium batteries has placed Greensea at a critical strategic crossroads. Current industry competition has evolved from a single technological competition to a comprehensive strength competition of "delivery capability + technical iteration speed + global service," which is also the core reason why the company chose to list on the Hong Kong Stock Exchange at this time. In conclusion, Greensea is a distinctive specialized enterprise in the mid-end equipment for lithium batteries. Their 17 years of deep cultivation have established solid technological barriers and a high-quality customer base, and their clear strategic positioning has allowed them to occupy a leading market position in a specialized field. This Hong Kong IPO will provide capital support for the company's capacity expansion, research and development, and globalization, helping them further consolidate their market position in the efficiency revolution of the lithium battery industry. For investors, focusing on the company's progress in capacity release, technological iteration achievements, and overseas market expansion will be key indicators for assessing its long-term investment value.