Hengxing Co. seeks listing on the Beijing Stock Exchange: A "building materials" business under the banner of new materials
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On April 30, Hunan Hengxing New Material Technology Co., Ltd. ("Hengxing Co.") will face deliberation at the Beijing Stock Exchange.
The core product of Hengxing Co. is UV coatings, primarily used for surface coating and bonding of PVC flooring, panel furniture, and other home building materials.
Although UV coatings are classified as "new materials" in statistics, Hengxing Co.'s revenue sources have long been anchored to the building materials industry chain.
Against the backdrop of slowing real estate demand, the future growth prospects of Hengxing Co. remain uncertain.
In fact, Hengxing Co.'s performance growth over the past three years has been limited. Its revenue from 2023 to 2025 is 755 million yuan, 879 million yuan, and 814 million yuan respectively, with net profit attributable to the parent company basically maintained around 100 million yuan in the same period and limited growth flexibility.
To break away from its reliance on the building materials industry chain, Hengxing Co. is expanding its customer base to consumer, automotive, and other industries, but its income proportion is still relatively limited, contributing less than 3% to total revenue in 2025.
For this IPO, Hengxing Co. plans to raise 292 million yuan, mainly for building production bases and improving its marketing network.
Whether Hengxing Co. can knock on the door of the Beijing Stock Exchange is currently a focus of attention.
From Building Materials to New Materials
The core products of Hengxing Co. are ultraviolet (UV) curing coatings and PUR hot melt adhesives, which can be used for surface coating and bonding of light industry products.
Among them, UV coatings are the main source of income for Hengxing Co., generating 672 million yuan, 780 million yuan, and 735 million yuan from 2023 to 2025 respectively, accounting for about 90% of total revenue.
Compared with traditional coatings, UV coatings perform well in environmental protection, energy saving, production efficiency improvement, and performance stability.
According to the National Bureau of Statistics' "Industrial Strategic Emerging Industry Classification Directory (2023)", UV coatings belong to the "advanced petrochemical new materials" under the new materials industry, further subdivided into "new functional coating material manufacturing".
From product attributes to official classification, Hengxing Co. seems to be already on the "new materials" track.
However, if the perspective shifts from "the material itself" to "where the materials are used", the answer starts to deviate.
The vast majority of Hengxing Co.'s products are applied to PVC flooring, panel furniture, edge banding, etc. Among these, PVC flooring is the core application, contributing 609 million yuan, 718 million yuan, and 651 million yuan in revenue from 2023 to 2025, accounting for about 80% of total revenue.
This business model determines the deeper attribute of Hengxing Co.: it is not a direct supplier of materials to high-end manufacturing or emerging industries, but rather an enterprise deeply embedded in the home building materials industry chain.
Tracing the timeline further, this "building materials background" becomes even clearer.
Hengxing Co. was formerly Huarong Hengxing Building Materials Co., Ltd., whose main business at inception was granite, marble, and other stone materials. In 2006, it shifted to UV coatings, and only changed its name to "Hunan Hengxing New Material Technology Co., Ltd." after launching its share reform in 2023.
From the company name, Hengxing Co. has completed the track switch, but its business scope has never left the building materials industry.
It is precisely because of this difference between "new materials in statistical caliber" and "building materials supporting role in industry chain location" that outsiders doubt the rationality of Hengxing Co.'s choice of comparable companies.
The prospectus shows Hengxing Co. lists Songjing Co., Guangxin Materials, and Feikai Materials as comparable companies.
But if you break down the core businesses of these companies, you will find obvious differences in their positions in the industry chain compared to Hengxing Co.
Songjing Co.'s coatings are mainly used in high-end consumer electronics and passenger vehicles; Guangxin Materials focuses on photoresists and supporting coatings—typical electronic chemical companies; Feikai Materials covers key areas like semiconductors and display panels, directly embedded in the integrated circuit and display industry chain.
The Beijing Stock Exchange has also raised inquiries in the past.
In the first round of inquiries, the Beijing Stock Exchange required Hengxing Co. to further explain the rationality behind its selection of comparable companies.
In response, Hengxing Co. explained that its industry is "CE264 Coating, Ink, Pigment, and Similar Product Manufacturing", and the selected comparable companies, Songjing Co., Feikai Materials, and Guangxin Materials, also belong to this industry, so they are comparable.
But this explanation is not sufficiently persuasive. Industry classification only indicates that companies share the same broad product category, but cannot directly prove comparability in downstream structure and growth logic.
This also means Hengxing Co. truly needs to answer whether, when its main income still comes from the building materials industry chain, it is appropriate to be measured on the same valuation coordinates as electronic chemicals, semiconductor materials, and high-end consumer electronics coating companies, and whether future growth prospects are comparable.
Grasp Both "Going Overseas" and Scene Expansion
As demand in the real estate industry slows, building materials demand inevitably takes a hit.
In such a context, upstream supporting companies can hardly remain unaffected. Hengxing Co.'s limited growth in reported performance reflects this logic.
In 2025, Hengxing Co.'s revenue and net profit attributable to the parent company are 814 million yuan and 111 million yuan respectively, down 7.36% and 2.05% year-on-year.
However, compared to most building material enterprises deeply bound to the domestic real estate cycle, Hengxing Co. is not completely passively under pressure; an important "buffer" comes from the expansion of its overseas market.
In 2025, revenue from overseas regions reached 278 million yuan for Hengxing Co., up more than 20% year-on-year, accounting for 34.12% of total revenue, an increase of more than 8 percentage points year-on-year.
Behind this change is the collective "going overseas" of the PVC flooring industry chain.
To better support its overseas customers, Hengxing Co. began establishing sales subsidiaries in Vietnam and Thailand in 2022, enhancing its response speed and service quality for overseas client needs.
One goal of this IPO is to fund the construction of a production base in Thailand.
“By building the Thailand production base, we aim to cover the entire Southeast Asian market, thus expanding the company’s overseas sales scale, increasing the global revenue proportion, and enhancing competitiveness in Southeast Asia and the global market,” stated Hengxing Co. “As more and more domestic customers set up production bases in Southeast Asia and other overseas regions, the overseas market has great development potential and the new capacity has a good market foundation.”
Meanwhile, Hengxing Co. is also trying to open up new application boundaries.
In recent years, the company has gradually extended products into the packaging of daily consumer goods such as tobacco, alcohol, and cosmetics, as well as automotive parts, interiors, and smart vehicle systems.
However, from the current income structure, these new applications are still in the introduction stage and have not yet substantially supported the overall performance. From 2023 to 2025, revenue from consumer and other businesses was only 5 million yuan, 9 million yuan, and 24 million yuan respectively.
On one hand, there is growth pressure from slowing building materials demand; on the other, the company seeks incremental space via “going overseas” and “expanding scenarios”. Whether these new businesses can become a new growth curve for Hengxing Co. still needs time to be validated.
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