Kesheng Technology submits to HKEX; major clients' dependency issue remains unresolved

On March 24, the solar thermal power giant Zhejiang Kesheng Technology Co., Ltd. (hereinafter referred to as “Kesheng Technology”) once again submitted its listing application materials to the Hong Kong Stock Exchange, aiming for a listing on the Hong Kong stock market. Prior to this, the company had submitted a listing application to the Hong Kong Stock Exchange on September 24, 2025. From a fundamental perspective, Kesheng Technology is projected to achieve steady growth in revenue and net profit for 2024 and 2025. However, alongside the resubmission of the application, the company’s high customer concentration has once again come to the forefront.

2025 Revenue of 2.193 Billion Yuan

The Hong Kong Stock Exchange’s official website shows that the concentrated solar power system supplier Kesheng Technology resubmitted its application on March 24.

It is understood that Kesheng Technology is one of the providers of tower solar thermal power and molten salt energy storage solutions. From 2021 to 2024, there have been 20 tower solar thermal projects in China that have commenced construction and confirmed their concentrated solar power system suppliers, with a total designed capacity of 2160 MW. The company has provided concentrated solar power systems for 11 of these 20 power stations in China—this system is the most critical subsystem for such power stations, with a total designed capacity of 1250 MW.

Therefore, according to a report by Frost & Sullivan, Kesheng Technology became the leading supplier of concentrated solar power systems in China from 2021 to 2024, capturing 57.9% and 55% of the market share in terms of total design capacity and number of projects, respectively. Furthermore, according to the Frost & Sullivan report, as of the last actual feasible date, Kesheng Technology is also the only concentrated solar power system supplier for molten salt tower solar thermal power stations globally with a cumulative service performance exceeding 1 GW.

Behind this push for a Hong Kong stock listing, Kesheng Technology’s performance during the reporting period has shown continuous growth. Financial data indicates that from 2023 to 2025, the company achieved revenues of approximately 858 million yuan, 2.189 billion yuan, and 2.193 billion yuan, respectively; corresponding annual profits were approximately 248 million yuan, 540 million yuan, and 568 million yuan.

However, it is noteworthy that in 2025, the company’s net cash used in operating activities was 252 million yuan; while in 2023 and 2024, the net cash generated from operating activities was approximately 931 million yuan and 329 million yuan, respectively. In the prospectus, Kesheng Technology also stated that if the company continues to record net cash outflows from operating activities in the future, its working capital may be constrained, which could negatively impact its financial performance. If the company encounters long-term and sustained net cash outflows from operating activities in the future, it may lack sufficient working capital to cover operational costs, and its business, financial condition, operating performance, and outlook may be significantly adversely affected.

While the performance is impressive, Kesheng Technology’s revenue also notably comes from a single product (service). The prospectus shows that during the reporting period, the revenue from the molten salt tower solar thermal power station solutions accounted for 99.6%, 95%, and 98.4% of total revenue, respectively. Among these, the revenue from sales of concentrated solar power systems and other core subsystems accounted for approximately 98.5%, 94.7%, and 97% of total revenue; while revenue from construction consulting, operation and maintenance technical guidance, and other technical services accounted for approximately 1.1%, 0.3%, and 1.4%, respectively.

Top Five Clients Account for 98.5% of Revenue

In this application to the Hong Kong Stock Exchange, Kesheng Technology’s high customer concentration has also become a focal point of market attention.

The prospectus shows that from 2023 to 2025, the revenue from the company’s top five customers was 858 million yuan, 1.937 billion yuan, and 2.159 billion yuan, accounting for 99.9%, 88.5%, and 98.5% of total revenue, respectively; during the same period, revenue from the largest customer was approximately 727 million yuan, 488 million yuan, and 675 million yuan, accounting for approximately 84.8%, 22.3%, and 30.8% of the company’s total revenue, respectively.

Additionally, it is worth mentioning that during the reporting period, Kesheng Technology issued substantial dividends. Specifically, at the special shareholders’ meeting held in December 2024, shareholders approved a dividend of 0.43 yuan per share, totaling 155 million yuan, which was subsequently distributed to shareholders; at the special shareholders’ meeting held in September 2025, shareholders approved a dividend of 0.4 yuan per share, totaling 144 million yuan, which was subsequently distributed to shareholders using internal resources.

In terms of equity relationships, as of the last actual feasible date, Jin Jianxiang directly held approximately 3.33% of the company’s issued shares; at the same time, because Jin Jianxiang holds a 99% interest in Hangzhou Jingjiu (the general partner of Huzhou Yuli), and as a limited partner, he holds approximately 93.34% interest in Huzhou Yuli, he is deemed to hold approximately 21.77% of the company’s issued shares through Huzhou Yuli. As of the last actual feasible date, Jin Jianxiang, Huzhou Yuli, and Hangzhou Jingjiu have the right to exercise 25.1% of the company’s voting rights.

“If the company has ample cash flow and the major shareholder has a need to cash out or optimize tax structures, dividends are a legitimate exercise of shareholder rights.” Yuan Shuai, deputy director of the Investment Department of the China Urban Development Research Institute, further stated, “However, in a technology-intensive industry that is in an expansion phase like solar thermal energy storage, funds should often be prioritized for R&D and capacity building, as excessive cash outflows may weaken its ability to withstand risks.”

Beijing Business Daily Reporter Wang Manlei