Goreli passes the HKEX hearing and may become the first listed company in the pan-semiconductor intelligent manufacturing software sector.

On June 24, Hong Kong Stock Exchange documents showed that Shanghai Gerui Software Co., Ltd. ("Gerui") has released its post-hearing information pack, marking its official approval in the HKEX IPO hearing. Guotai Junan International and Minyin Capital are serving as joint sponsors.

As a company applying for listing under Chapter 18C of the HKEX, Gerui’s expected market value in this issuance will exceed HKD 4 billion.  

From the financial situation outlined in its prospectus, Gerui displays the typical characteristics of an early-stage commercial, industrial software company: heavy capital investment and long payment cycles in exchange for market share.

In terms of its business, Gerui’s core operations focus on China’s broad semiconductor industry, covering semiconductors, panels, PCB, and photovoltaics, providing intelligent manufacturing software solutions.

In terms of scale, the company maintained rapid revenue growth during the reporting period. The prospectus shows that from 2023 to 2025, Gerui’s operating revenue was RMB 165 million, RMB 249 million, and RMB 300 million respectively. The broad semiconductor IMSS business contributed the absolute majority of revenue, accounting for 99.0%, 99.1%, and 99.3% of total income from 2023 to 2025, respectively.

However, while revenue expanded, its profit remained under significant pressure.

From 2023 to 2025, the company’s net losses were RMB 127 million, RMB 103 million, and RMB 104 million, respectively. Even excluding non-cash and one-off items such as share payments and listing expenses, its adjusted net losses were RMB 126 million, RMB 102 million, and RMB 83.63 million, respectively.  

Its gross margin structure reveals part of the reason for the losses. In 2023 to 2025, Gerui’s overall gross margin was 3.4%, 13.2%, and 14.2% respectively. Though showing signs of recovery, the absolute values remain extremely low within the software industry.

The prospectus acknowledges that the low gross margin is directly related to loss contract provisions and inventory impairment losses. Due to the company's strategy of offering strategic pricing to win benchmark projects and new customers, some projects faced cost overruns early in their execution.  

For industrial software companies in the To B segment, the challenge of cash flow is generally more severe than the book losses. From 2023 to 2025, Gerui’s net cash used in operating activities was RMB -116 million, RMB -143 million, and RMB -113 million, respectively, showing net outflows for three consecutive years.  

This “bleeding” state stems from its long cycle business model; Gerui’s revenue recognition depends heavily on phased delivery and acceptance of individual projects.

Data shows that its cash conversion cycle reached 556 days in 2023, though shortened to 243 days by 2025, still meaning more than eight months of capital lock-up. Simultaneously, in 2025, its turnover days for trade receivables and notes receivable remain as high as 229 days. The dual challenge of long delivery and payment cycles poses substantial challenges for its working capital chain.  

However, in terms of industry ranking, Gerui has secured a place in its vertical niche.

Based on 2025 revenue, Gerui ranks third in China’s broad semiconductor IMSS market, and second among domestic providers, with around 12% market share. But in the broader Chinese IMSS market, its share is only 0.5%, ranking 16th.  

From a customer structure perspective, Gerui faces significant risks of customer concentration.

From 2023 to 2025, its top five customers contributed 54.2%, 46.7%, and 23.1% of total revenue. The single largest customer accounted for 20.0%, 19.8%, and 7.9% of revenue during the reporting period. If major customers cut capital expenditure or technological investment, it will directly impact Gerui’s performance.  

From a technology base, Gerui’s fundamental income comes from its production operation platform, which includes computer-integrated manufacturing systems, and integrated automation platform. Together these contributed 82.7%, 78.5%, and 71.6% of revenue from 2023 to 2025.

It's noteworthy that the company is extending its business into the AI sector.

To meet the needs for physical AI and unmanned factories in advanced manufacturing, Gerui is advancing the commercialization of its LOFA intelligent control digital platform. This platform aims to integrate remote centralized control, AI, and industrial vision technologies, replacing manual re-inspection with automated repair operations.

However, intensive technological iteration requires concentrated capital resources. From 2023 to 2025, Gerui's R&D expenses were RMB 66.42 million, RMB 59.02 million, and RMB 66.24 million, accounting for as much as 40.1%, 23.7%, and 22.1% of total income respectively.  

Overall, Gerui’s pursuit of a Hong Kong listing is essentially the capital market’s premium on the logic of domestic substitution in the broad semiconductor industrial software sector. The fundraising will help replenish its capital to cope with intensive R&D and long-cycle project consumption.

But looking forward, how to optimize its strategic pricing model, shorten delivery and acceptance cycles, and rely on AI empowerment to substantially raise gross margin to cross the break-even point will be its core industrial challenge after entering the secondary market.

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