Recently, Jiangsu Lopal Tech. has started the listing of H shares, with the listing date from October 22 to October 25. The highest offering price is 7.00 Hong Kong dollars, and the trading unit is 500 shares per lot, with an entrance fee of about 3,535.30 Hong Kong dollars. The company is expected to officially list on the main board of Hong Kong on October 30, becoming the first A+H listed company in the domestic battery materials industry.

1. Cathode materials, the "hidden champion", capital operation triggers industry boom.

As a "hidden champion" emerged from the automotive industry chain, Jiangsu Lopal Tech. has now become a leading global supplier of new energy lithium battery lithium iron phosphate cathode materials.

As early as 2021, Jiangsu Lopal Tech. entered the lithium battery cathode material business through the acquisition of 100% equity of Tianjin Bettery Nano and Jiangsu Battery Nano. Subsequently, the company has carried out a series of capital operations, achieving rapid expansion in this field.

Thanks to this, the company's operational scale has continuously reached new heights.

Looking at the financial data, in 2021, revenue from lithium iron phosphate cathode materials was 1.877 billion yuan, which increased to 12.242 billion yuan in 2022, accounting for 77.4% of the company's total revenue.

(Source: Company Prospectus)

In 2023, due to the slowdown in downstream demand for lithium batteries and new energy vehicles manufacturing as well as the price decline of lithium carbonate, the company's sales scale has decreased slightly. However, from the current perspective, after the second quarter of this year, along with the overall recovery of the industry, Jiangsu Lopal Tech.'s revenue has been in the process of recovery, with continuous increase in production capacity utilization rate, and profit capability is improving.

In this context, Jiangsu Lopal Tech. is also continuously consolidating its leading position in the industry. According to data from Shanghai Metals Market (SMM), as of June this year, among the Top 5 leading companies, only Jiangsu Lopal Tech.'s Changzhou Lithium Source under its umbrella achieved positive growth in market share, with the company's market share increasing from 7.5% to 8.1%, currently ranking third in shipments among the leading companies.

Through the company's transformation, it is easy to see that Jiangsu Lopal Tech. has strong resilience and flexibility, able to quickly enter into newly laid out industries. This is attributed to its deep accumulation in the industry chain and forward-looking strategic layout. Prior to the acquisition of Tianjin Betteray and Jiangsu Betteray Nano by Betteray Group, Jiangsu Lopal Tech. had over ten years of experience in the research and development of lithium iron phosphate cathode materials, forming extensive knowledge accumulation.

As the company transitions from traditional environmentally friendly fine chemicals for automotive use to lithium iron phosphate cathode materials business, Jiangsu Lopal Tech. has now achieved significant success in the field of green new energy core materials, with all business segments flourishing. Besides lithium iron phosphate cathode materials, the company is also the third-largest manufacturer of diesel engine urea solution and the third-largest coolant manufacturer in mainland China, with market shares of 9.1% and 5.8% respectively.

It is evident that with a diversified business layout and leading positions in various segmented markets, Jiangsu Lopal Tech. has further strengthened the stability of its performance and risk resistance ability. The synergistic effects are continuously unfolding, providing solid support for its long-term stable development.

2. Open a new chapter for the "A+H" dual listing and embrace a new milestone in overseas markets.

As a company that has been listed on the A-share market for seven years, Jiangsu Lopal Tech.'s listing in Hong Kong undoubtedly opens up new growth opportunities for them.

On one hand, through the "A+H" dual-platform operation, Jiangsu Lopal Tech. is able to reach a broader group of investors, especially gaining recognition from overseas capital markets, helping to enhance the company's international reputation and influence.

On the other hand, a listed hong kong stock will provide jiangsu lopal tech. with a more diverse channel for fundraising. The acquired low-cost funds are also expected to be used in key areas such as company technology research and development, market expansion, and capacity expansion, which is particularly important for jiangsu lopal tech. at its rapid development stage.

In addition, the IPO fundraising will further improve the company's financial structure, reduce financial pressure, and enhance financial stability.

In fact, the "A+H" listing also echoes the global strategy of jiangsu lopal tech.'s overseas layout. One important use of the fundraising from the hong kong stock listing this time is for the second-phase construction expenses of the Indonesia project factory.

(Source: Company Prospectus)

It is worth mentioning that on the 8th of this month, its Indonesia project received an investment of up to 0.2 billion US dollars from investors led by the Indonesian National Sovereign Wealth Fund (INA). This investment plan will expand the capacity of its Indonesian factory from the current Phase 1 annual production of 0.03 million tons to an annual production of 0.12 million tons by 2025, making it the largest LFP cathode material manufacturing factory globally outside China.

It is evident that jiangsu lopal tech. has a significant first-mover advantage in its overseas layout, and with the continuous progress of the Indonesia project, it is expected to bring more growth potential and profit space to the company.

Moreover, this "A+H" listing will further enhance the company's international competitiveness, enabling jiangsu lopal tech. to better utilize international capital market resources, accelerate the implementation of its internationalization strategy, and thus secure a more favorable competitive position in the global new energy industry.

Conclusion

Against the backdrop of global nengyuanhangye turning towards clean and low-carbon development, the new energy industry is one of China's strategic emerging industries with international competitive advantages, and it has received strong support from national industrial policies. In this context, jiangsu lopal tech. is accelerating its international development pace.

By listing both in China's main board and the main board of Hong Kong, jiangsu lopal tech. will better seize the opportunities in the global new energy industry and achieve a new milestone in development.

Focusing on the current new Hong Kong stock market, jiangsu lopal tech.'s listed H shares face a relatively favorable market environment. As a 'hidden champion' in the segmented industry, the company is rare, with a reasonable issue price. Additionally, the fundamental recovery, coupled with a series of catalysts from policy support, overseas expansion, are expected to bring positive market performance expectations.