Working capital: receivables, prepayments and cash cycle
Hong Kong IPO disclosure precedents · 547 companies, 635 items
high or rising trade receivables, long turnover days, overdue balances, subsequent settlement, impairment; large or rising prepayments; a long cash conversion cycle
Our trade and notes receivables increased from RMB74.3 million as of December 31, 2023 to RMB100.9 million as of December 31, 2024, and further increased to RMB135.6 million as of December 31, 2025 and RMB174.7 million as of July 31, 2026 in line with the growth in our sales.
Financial Information · p. 226
The increase was primarily driven by our business scale expansion and sales growth, particularly the growth in overseas sales, for which the collection cycle is generally longer.
Financial Information · p. 227
We seek to maintain strict control over our outstanding receivables and have established credit control policies to minimize credit risk.
Our trade and bills receivables, net of impairment, increased to RMB78.3 million as of April 30, 2026, primarily in line with our revenue growth.
Financial Information · p. 262
Our trade and bills receivables turnover days increased from 54.9 days in 2025 to 65.1 days in the four months ended April 30, 2026, primarily because
Financial Information · p. 263
Our impairment losses under ECL model, net of reversal changed from reversal of impairment losses RMB0.9 million in the four months ended April 30, 2025 to impairment losses of RMB8.1 million in the four months ended April 30, 2026, primarily due to the net impairment losses recognized on trade and bills receivables, mainly attributable to (i) the increase in revenue by 50.7% in the four months ended April 30, 2026 compared to the corresponding period in 2025, which resulted in a larger balance of trade receivables; and (ii) a higher loss rate applied to balances from certain customers, taking into consideration their historical default patterns and the cessation of our business relationships with these customers.
Our trade and bill receivables increased from RMB21.4 million as of December 31, 2023 to RMB33.0 million as of December 31, 2024, to RMB105.9 million as of December 31, 2025, and to RMB295.9 million as of June 30, 2026, primarily driven by the expansion of our business.
Financial Information · p. 214
Our trade and bill receivable turnover days increased from 27 days in 2025 to 69 days in the six months ended June 30, 2026, primarily due to an increase in our trade receivables balance as certain AI Computing Infrastructure Solutions projects were completed and accepted by customers toward the end of the period.
Financial Information · p. 215
As of July 31, 2026, approximately RMB34.6 million, or 10.7% of our trade and bill receivables outstanding as of June 30, 2026, had been subsequently settled.
Our prepayments and other assets increased to RMB246.2 million as of December 31, 2025 and RMB281.3 million as of June 30, 2026, primarily due to an increase in prepayments for purchasing hardware for AI Computing Infrastructure Solutions from RMB20.6 million as of December 31, 2024 to RMB220.4 million as of December 31, 2025 and RMB251.9 million as of June 30, 2026, which were mainly attributable to advance procurement in anticipation of upcoming projects under our AI Computing Infrastructure Solution business.
During the Track Record Period, our trade and bills receivable turnover days were longer than the credit period that we typically granted to our customers, which was 60 to 120 days, primarily because certain customers issued us bills prior to the due dates of their trade receivables, extending the settlement time of such amounts.
Financial Information · p. 232
During the Track Record Period, we made proactive efforts to collect trade receivables from our customers, including (i) closely monitoring the status of our trade receivables; (ii) holding periodic meetings to discuss the status of our outstanding trade receivables; (iii) timely communicating with and reminding our customers of payments through various channels; and (iv) taking legal actions when necessary to recover outstanding trade receivables.
Financial Information · p. 232
As of July 31, 2026, US$58.3 million, or 34.7%, of our trade receivables as of June 30, 2026 had been subsequently settled.
Our trade and notes receivables increased from RMB214.0 million as of December 31, 2023 to RMB254.1 million as of December 31, 2024, and further increased to RMB275.7 million as of December 31, 2025, primarily reflecting our business growth in 2024, as well as slower payments from certain pharmaceutical glass packaging customers in 2024 and 2025 amid the implementation of medical insurance cost control in the PRC.
Financial Information · p. 226
Our trade receivables turnover days increased from 69 days in 2024 to 86 days in 2025, consistent with the increase in our trade receivables balances resulting from our business growth and slower payments from certain pharmaceutical glass packaging customers.
Financial Information · p. 226
We have established credit control procedures to manage the recoverability of our trade and notes receivables.
Our trade receivables amounted to RMB127.5 million, RMB133.8 million, RMB166.6 million and RMB238.8 million as of December 31, 2023, 2024 and 2025 and May 31, 2026, respectively.
Financial Information · p. 246
Our trade receivable turnover days were 100 days, 72 days, 67 days and 75 days in 2023, 2024 and 2025 and the five months ended May 31, 2026, respectively.
Financial Information · p. 246
To optimize our cash conversion cycle, we have implemented a comprehensive set of measures across our procurement, sales and finance functions.
Our trade receivables increased to RMB1,112.2 million as of December 31, 2025 and decreased to RMB752.9 million as of March 31, 2026, primarily due to the settlement process of certain large amount of receivables recognized by the end of 2025 which was subsequently settled as of March 31, 2026.
Financial Information · p. 280
Our trade receivables turnover days increased to 170 days for the three months ended March 31, 2026, primarily because a relatively high amount of receivables in relation to a large-scale intelligent computing center solution was recognized by the end of March and was settled in July 2026, and certain payments from one customer were temporarily delayed due to overseas remittance process.
Financial Information · p. 281
As of July 31, 2026, RMB618.2 million, or 81.2% of our gross trade receivables as of March 31, 2026 had been subsequently settled.
Our trade and bills receivables increased from RMB72.3 million as of December 31, 2023 to RMB114.4 million as of December 31, 2024, to RMB261.6 million as of December 31, 2025, and further to RMB311.6 million as of June 30, 2026, primarily due to the increased sales of our solutions and products as a result of our continuous business expansion and the Acquisition.
Financial Information · p. 231
Our trade and bills receivables turnover days increased from 142.8 days in 2025 to 154.3 days in the six months ended June 30, 2026, primarily due to the delayed payment by certain tier-one suppliers.
Financial Information · p. 232
As of the July 31, 2026, approximately RMB50.6 million, or 16.2% of our trade and bills receivables as of June 30, 2026 had been subsequently settled.
Our trade receivables increased by 71.8% from RMB1,965.1 million as of December 31, 2023 to RMB3,376.5 million as of December 31, 2024, primarily due to the recognition of the trade receivables arising from transactions involving our former subsidiary in India following its disposal.
Financial Information · p. 232
Our trade receivables further increased by 10.4% to RMB3,726.3 million as of December 31, 2025 primarily because certain overseas customers adopt more sea freight instead of air freight shipping.
Financial Information · p. 233
As of July 31, 2026, RMB5,210.0 million, or 95.9%, of our trade receivables as of April 30, 2026, had been settled.
Our trade and bills receivables turnover days increased from 75 days in 2023 to 88 days in 2024, and further to 95 days in 2025, primarily reflecting the relatively longer credit term for certain key customers with strong credit profiles.
Financial Information · p. 254
Notwithstanding such increase, the aging profile of our trade receivables remained relatively short, with RMB239.2 million, or approximately 98.2%, of our trade receivables as of March 31, 2026 being aged within three months and RMB4.4 million, or approximately 1.8%, being aged between three and six months.
Financial Information · p. 254
As of July 31, 2026, RMB182.4 million, or approximately 74.9% of our trade receivables as of March 31, 2026 had been subsequently collected.
Our trade and bills receivables increased from RMB998.6 million as of December 31, 2023 to RMB1,116.2 million as of December 31, 2024 and RMB1,374.4 million as of December 31, 2025, and further increased to RMB1,677.4 million as of June 30, 2026, primarily reflecting the expansion of our sales and the corresponding increase in customer receivable balances, as well as the timing of customer collections under our customary credit terms.
Financial Information · p. 179
We manage our credit risk through a customer credit-management system covering customer admission, credit approval, ongoing credit monitoring, periodic reconciliation and collection of overdue balances.
Financial Information · p. 179
As of July 31, 2026, RMB488.9 million, or 29.1%, of our trade receivables as of June 30, 2026, had been settled.
Our trade and bills receivables increased by 114.9% from RMB79.4 million as of December 31, 2025 to RMB170.7 million as of June 30, 2026, primarily due to our business expansion.
Financial Information · p. 222
Our trade and bills receivables turnover days exceeded our standard credit terms of 30 to 90 days during the Track Record Period.
Financial Information · p. 223
As of August 31, 2026, RMB50.0 million, or 28.1%, of our trade and bills receivables as of June 30, 2026, had been settled.
Our trade and bills receivables increased by approximately RMB260.1 million from RMB1,073.0 million as at 31 December 2025 to RMB1,333.1 million as at 30 June 2026, which was basically commensurate with the annualised rate of increase in our sales determined based on the increase in sales from 6M2025 to 6M2026.
Financial Information · p. 229
During the Track Record Period, a large majority of our trade and bills receivables were outstanding for not more than six months, which was in line with the credit periods we granted to our customers that typically ranged from 30 days to 180 days.
Financial Information · p. 229
As at 31 July 2026, approximately 57.2% of our trade and bills receivables (before impairment loss) as at 30 June 2026, amounting to RMB769.9 million, had been settled.
Our trade and bills receivables increased from RMB362.4 million as of December 31, 2023 to RMB518.7 million as of December 31, 2024, and further increased to RMB751.0 million as of December 31, 2025, primarily due to the extended collection period caused by fluctuation in sales and changes in financial conditions of our customers and the overcapacity in the PV sector.
Financial Information · p. 208
Our trade receivables aged one year and above increased in both absolute amount and as a percentage of total trade receivables, from RMB25.6 million (or approximately 9.0% of total trade receivables) as of December 31, 2023 to RMB26.9 million (or approximately 6.2% of total trade receivables) as of December 31, 2024, and further to RMB168.2 million (or approximately 25.0% of total trade receivables) as of December 31, 2025 and further to RMB158.2 million (or approximately 27.0% of total trade receivables) as of April 30, 2026.
Financial Information · p. 209
In particular, in order to accommodate the liquidity pressures faced by our PV customers during the downturn and to maintain our customer relationships, we agreed to extend the payment terms for certain PV customers, including in certain cases permitting settlement by instalments over a period of up to 36 months.
Our trade and bills receivables decreased by RMB190.1 million, or 3.9%, from RMB4,869.8 million as of December 31, 2025 to RMB4,679.6 million as of April 30, 2026, primarily due to our enhanced credit management measures.
Financial Information · p. 229
Our trade and bills receivable turnover days decreased from 129 days for the year ended December 31, 2023 to 119 days for the year ended December 31, 2024, and further decreased to 110 days for the year ended December 31, 2025, primarily due to our enhanced credit management on our receivables.
Financial Information · p. 230
As of July 31, 2026, RMB3,662.2 million, or 74.4%, of our trade and bills receivables as of April 30, 2026 had been settled.
Our cash conversion cycle increased from 156 days in 2023 to 304 days in 2024, 406 days in 2025 and further to 580 days for the four months ended April 30, 2026.
Business · p. 176
The cash conversion cycle of our PV business lengthened significantly over the Track Record Period, driven principally by (i) our PV customers generally taking a longer time to settle their outstanding balances, amid the PV industry downturn and the resulting financial and liquidity pressure on our customers, which resulted in a marked lengthening of our trade and bills receivables turnover days; and (ii) the slower pace of customer acceptance during the downturn, which extended the interval between our incurrence of production costs and the recognition of revenue and the collection of payment, thereby further lengthening the cycle.
Business · p. 176
Our SiPh business operated with a materially shorter cash conversion cycle than our PV business.
Our trade receivables increased by 30.9% from RMB571.5 million as of December 31, 2023 to RMB747.8 million as of December 31, 2024, and further increased by 5.0% to RMB785.2 million as of December 31, 2025, primarily due to the increase in our sales and an extension of customer credit terms in line with PRC pharmaceutical industry procurement practices.
Financial Information · p. 230
Our trade receivables turnover days increased from 47.7 days in 2023 to 57.9 days in 2024, and further increased to 68.8 days in 2025, primarily due to an extension in customers' payment cycles, which was in line with PRC pharmaceutical industry procurement practices.
Financial Information · p. 231
As of July 31, 2026, RMB337.3 million, or 42.8% of our trade receivables as of June 30, 2026, had been settled.
Our relatively long trade and bills receivables turnover days during the Track Record Period was mainly attributable to our relatively high proportion of sales to customers in China with relatively long credit terms.
Financial Information · p. 211
Our trade and bills receivables turnover days decreased from 126.7 days in 2023 to 112.0 days in 2024 and further to 82.3 days in 2025 and to 71.0 days in the six months ended June 30, 2026, primarily due to increases in our revenue and our enhanced collection efforts.
Financial Information · p. 211
As of July 31, 2026, RMB1,171.1 million, or 48.6%, of our total trade and bills receivables outstanding as of June 30, 2026 had subsequently been collected.
Our trade receivables turnover days increased from 74 days in 2024 to 100 days in 2025, primarily due to an increase in the balance of trade receivables to RMB203.7 million as of December 31, 2025.
Financial Information · p. 249
The increase in trade receivables was primarily attributable to the delayed payment process of one of our major customers, resulting in a slower pace of trade receivable collection and a higher year-end balance.
Financial Information · p. 250
As of July 31, 2026, RMB119.9 million, or 74.3% of our trade receivables as of March 31, 2026, had been settled.