Shihua Technology plans to invest 500 million in high-performance optical materials, driven by innovation, and has accumulated a total of 132 authorized patents.

With the expansion of market demand, well-known domestic listed rubber companies(23.830, 0.00, 0.00%)(688093.SH) accelerates its expansion pace.

On March 26, Shihua Technology announced that its wholly-owned subsidiary, Jiangsu Shituo New Materials Technology Co., Ltd. (referred to as "Jiangsu Shituo"), plans to invest in the construction of a "High-Performance Optical and Integrated Circuit Polymer Materials Project" at the Jiangsu Yangtze River International Chemical Industry Park, with an estimated total investment of approximately 500 million yuan.

Shihua Technology stated that this investment is based on the company's strategic plan and aims to create a leading materials technology platform to enhance the manufacturing capabilities of polymer materials in related fields.

The company places a high emphasis on research and development, with a cumulative R&D investment of 119 million yuan from 2022 to 2024. By the end of 2024, the company has obtained a total of 132 authorized patents, including 79 invention patents.

Plan to invest 500 million in the construction of a high-performance optical materials project.

On March 26, Shihua Technology announced that its wholly-owned subsidiary, Jiangsu Shituo, plans to invest in the construction of a high-performance optical and integrated circuit polymer materials project, with a total estimated investment of approximately 500 million yuan. Among this, the fixed asset investment is about 350 million yuan, and the working capital for initial expenses is approximately 150 million yuan.

The funding for the above project will mainly come from the company's own or self-raised funds, with a construction period estimated to be 2 to 3 years. Shihua Technology stated that the project aims to enhance the company's manufacturing capabilities in polymer materials for optical display and integrated circuit fields, aligning with the company's strategic development plan.

Currently, the global market space for optical materials is large, with high-end materials primarily dominated by foreign companies, indicating significant potential for domestic substitution. According to data from three market sources, the global optical film market size is expected to reach 29.8 billion USD in 2024 and grow to 55.5 billion USD by 2032, with an average annual compound growth rate of 8.08%.

Facing the favorable opportunities for industry development, Shihua Technology is actively making arrangements. In December 2024, the company plans to invest approximately 2.2 billion yuan to build a high-performance optical materials manufacturing base project in the Wujiang Economic and Technological Development Zone of Suzhou. The project is expected to be completed within 3 to 5 years.

In January 2025, Shihua Technology plans to raise no more than 600 million yuan through a private placement to expand its production of optical display film materials. The company stated that once the project is completed, it will effectively enhance the manufacturing capacity of high-performance optical materials, further strengthen the company's industrial layout in the field of functional materials, and improve the company's product structure and application areas, aligning with the company's strategic needs and requirements for high-quality growth.

The financial report shows that by the end of 2024, Shihua Technology had cash and cash equivalents of 312 million yuan, total liabilities of only 170 million yuan, and a debt-to-asset ratio of 7.98%, a decrease of 1.31 percentage points compared to the previous year.

Revenue and net profit both increased in 2024.

According to public information, Shihua Technology was established in 2010. It is a national-level specialized and innovative "little giant" enterprise and a national high-tech enterprise engaged in the research and development, production, and sales of functional materials. Its products include electronic composite functional materials, optoelectronic display module materials, and precision process application materials, among others.

From the performance perspective, in 2024, Shihua Technology achieved a revenue of 795 million yuan, a year-on-year increase of 55.36%; the net profit reached 280 million yuan, a year-on-year increase of 44.56%. Both revenue and net profit set historical highs.

During the reporting period, Shihua Technology focused on its core business of functional materials, relying on continuous technological innovation and iteration to continuously expand the application boundaries of its products. In terms of products, functional electronic materials achieved revenue of 575 million yuan, a year-on-year increase of 22.24%; high-performance optical materials achieved revenue of 218 million yuan, a year-on-year increase of 442.13%, becoming a key engine driving the company's performance growth.

Changjiang Business Journal noted that currently, Shihua Technology has a strong capability in market expansion. The financial report shows that in 2024, the company's production, sales, and inventory of functional materials increased by 84.91%, 69.42%, and 195.73%, respectively, compared to the same period last year.

At the same time, thanks to long-term good cooperation, the customer's recognition of the company's brand continues to increase. Shihua Technology has also established subsidiaries in the United States, Singapore, and Japan. By 2024, its export revenue proportion is expected to rise to 10.9%, and the mid-to-high-end functional materials industry has gradually begun to show an international competitive landscape.

In recent years, Shihua Technology has focused on continuous innovation in the field of functional materials, continuously increasing its R&D investment. Financial reports show that the company's R&D investment from 2022 to 2024 was 32.269 million yuan, 36.767 million yuan, and 50.205 million yuan, respectively, with year-on-year growth rates of 5.84%, 13.94%, and 36.55%. The cumulative R&D investment over the past three years has reached 119 million yuan.

Continuous research and development have also brought fruitful results. By the end of 2024, Shihua Technology has cumulatively obtained 132 authorized patents, including 79 invention patents and 53 utility model patents. During the reporting period, the company applied for 38 new invention patents and 16 utility model patents; it obtained authorization for 13 invention patents and 9 utility model patents.