Yihong Smart Rushes for Hong Kong IPO, CATL Contributes Over 70% of Revenue
Alina Collins
Lithium-battery equipment maker Yihong Intelligence has filed for an HKEX main-board listing, posting ~37% compound annual revenue growth over three years — but its largest customer, CATL, contributes over 70% of sales, making client concentration the single biggest risk post-IPO.
What does this company actually do?
Yihong Intelligence (易鸿智能) has two business lines: lithium-battery smart equipment — machines that roll-press and slit electrode sheets in one integrated step — and machine-vision inspection — cameras that automatically spot battery defects.
The company is mid-pivot. Equipment revenue surged from RMB 96 million in 2023 to RMB 461 million in 2025, rising from 32.7% to 83.6% of total sales. Vision-inspection revenue shrank from RMB 174 million to RMB 71 million over the same period.
This means → Yihong has transformed from a vision-inspection firm into a heavy-equipment supplier. Its bet is squarely on large-format integrated machines.
How do the financials look?
Revenue for 2023–2025: RMB 294 million, 394 million, and 552 million, a compound annual growth rate of roughly 37%.
But net profit swung wildly: just RMB 709,000 in 2023, jumping to RMB 51.3 million in 2024, then RMB 69.7 million in 2025. The 2024 surge was partly driven by fair-value gains on financial-asset disposals — not all operating profit.
Gross margin climbed from 19.6% in 2023 to 30.9% in 2024, then slipped back to 26.2% in 2025. In plain terms = revenue is growing, but profitability has not stabilized.
What happened to the vision-inspection business?
Gross margin for machine-vision inspection crashed from 40.8% in 2024 to 14.4% in 2025 — more than halved.
The company's explanation: intensifying competition driving down average selling prices. This means → the vision-inspection segment has low barriers; the top five suppliers hold just 31.2% combined market share, leaving the field fragmented and price-competitive.
This reflects something deeper: Yihong's pivot to equipment is not purely a voluntary upgrade — vision-inspection margins were being squeezed, so the shift was partly a matter of survival.
How heavy is the CATL dependency?
Top-five clients accounted for 98.7%, 97.2%, and 94.4% of revenue in 2023–2025. CATL alone contributed 86.0%, 67.1%, and 75.8% respectively.
In 2025, Yihong held roughly a 50% share of wide-format roll-press-and-slit integrated machines on CATL production lines.
In plain terms = more than seven out of every ten renminbi of revenue come from one customer — a customer that also has the capability to develop equipment in-house. If CATL cuts capex or shifts to self-developed machines, Yihong's top line takes an immediate hit.
Is the industry ceiling high enough?
Frost & Sullivan projects the global lithium-battery smart-equipment market will grow from RMB 58.3 billion in 2025 to RMB 141.7 billion by 2030, a 19.4% CAGR.
Europe and North America are growing faster — roughly 28.3% and 25.9% respectively. Yihong has set up subsidiaries in Hungary and the UK, though overseas operations are still nascent.
The wide-format roll-press-and-slit machine market is highly concentrated: the top three makers hold 95.1% combined share. This means → Yihong already sits at the top of this niche, but the room left for newcomers is razor-thin — growth depends on taking share or waiting for the total market to expand.
What else should investors watch before the IPO?
R&D spending as a share of revenue fell from 12.8% in 2023 to 8.9% in 2025 — revenue grew faster than R&D investment, so research intensity is diluting.
Yihong has delivered its first high-speed automated assembly line for full-tab cylindrical cells and secured an order from a leading South Korean cylindrical-battery maker's Nanjing plant — a first step toward client diversification.
This reflects the company's awareness of its "CATL dependency" risk; it is trying to spread exposure through new product lines and overseas clients. But the volumes are still small — whether concentration truly falls depends on order structure over the next two years.
Content is for reference only, not financial advice.