New stock preview | Lingong Group re-submitted its application: Gross profit margin increased by "reducing volume to maintain price", revealing that the old and new driving forces are not connected.

On May 20, the Hong Kong Stock Exchange welcomed once again the engineering machinery giant from Shandong - Lingong Heavy Machinery Co., Ltd. (referred to as Lingong Heavy Machinery). After its initial application in November 2025, this leading mining equipment and aerial work equipment company, sponsored by CICC and CISI FIN, is making another attempt to impact the Hong Kong stock market. At the intersection of the green transformation and globalization trends in the engineering machinery industry, Lingong Heavy Machinery is trying to accelerate its transition from "Made in China" to "global giant" with the help of the capital market. Significant revenue fluctuations Profit increase against the tide The prospectus shows that Lingong Heavy Machinery has built a global research, production, and sales network covering China, Japan, and Mexico, with products exported to over 100 countries and regions worldwide. The overseas sales revenue accounted for over 51.3% in 2025, marking a successful transformation into a truly global enterprise. Looking at the financial data, Lingong Heavy Machinery's performance is not optimistic. Firstly, there is a significant shrink in revenue scale. After a strong growth of 21.5% in 2024, the operating revenue dropped sharply to about 10.148 billion yuan in 2025, a decrease of over 17 percentage points from the peak of 12.028 billion yuan in 2024. More crucially, the growth in 2024 was a rebound from a 6% decline in revenue in 2023, indicating a drastic fluctuation of "decline-rebound-decline" in the company's revenue growth trajectory, lacking sustainable growth momentum. The revenue decline should have been a warning signal for profit, however, interestingly, the net profit of the company in 2025 increased by about 4% year-on-year to 1.04 billion yuan, showing a counter-trend of "increasing profit without increasing revenue." The profit increase in 2025 mainly relied on the improvement of gross profit margin, which itself presents a logical contradiction with the shrinkage in revenue scale - the company's gross profit margins from 2023 to 2025 were 18.8%, 20.1%, and 23.5%, showing a rising trend. However, a deeper analysis of the driving factors behind the increase reveals the underlying issues: the increase in gross profit margin mainly benefited from the increased proportion of high-gross-profit new energy mining equipment sales, and the structural dividend brought about by the rise in the proportion of overseas market revenue. But the problem lies in the fact that the revenue of the high-altitude operation equipment business with a high gross profit margin of 25.9% saw a sharp decline, while the lower gross profit margin mining equipment accounted for a larger share of the revenue. This "shrinkage of high-gross-profit business, expansion of medium to low-gross-profit business" in the revenue structure adjustment actually erodes the basis of the company's future gross profit margin. Once the overseas market sentiment falls or the demand for new energy products slows down, the company's path to improving gross profit margin that it currently relies on will quickly narrow or even reverse.