According to the Beijing Stock Exchange, on November 6, the exchange issued its second round of inquiries regarding the application documents of Qiao Luming Technology Co., Ltd. (hereinafter referred to as "Qiao Luming"), which is sponsored by Orient Securities Co., Ltd., for its public offering and listing on the Beijing Stock Exchange. The inquiries mainly focused on the authenticity of revenue and the adequacy of the verification of cash flow, the sustainability of performance growth, the overlap of major customers and suppliers with related parties, and the necessity and rationality of the fundraising projects.
According to project updates disclosed by the Beijing Stock Exchange, Qiao Luming's IPO application was accepted by the exchange on June 26 this year, received the first round of inquiries on July 22, and received the second round of inquiries on November 6.
Public information shows that Qiaoluming Technology Co., Ltd. is an enterprise engaged in the research, development, production and sales of automotive trim parts. Its main products include automotive interior parts, automotive exterior parts and related molds. In 2024, BYD Auto, Geely Auto, NIO, Leapmotor and Dongfeng Voyah were its top five customers.
Is sales to BYD stable and sustainable?
The authenticity of revenue and the adequacy of the verification of cash flow are among the key points of this inquiry. According to data disclosed by Qiao Luming, his sales revenue to BYD in 2022, 2023, 2024, and the first half of 2025 were RMB 568 million, RMB 1.219 billion, RMB 1.852 billion, and RMB 605 million, respectively, accounting for 36.42%, 47.69%, 54.89%, and 42.49% of operating revenue. However, BYD only accepted an interview with an intermediary agency in 2022 and has not agreed to be interviewed since.
In response, the Beijing Stock Exchange requested Qiao Luming to explain the reasons and rationale for BYD's refusal to accept interviews with intermediaries in 2023 and subsequent years, and whether BYD had similar practices with other suppliers; regarding the authenticity of Qiao Luming's transactions with BYD, whether the alternative verification procedures adopted by the intermediaries and the current verification procedures can support the verification conclusions.
Regarding the verification of fund flows, the Beijing Stock Exchange requires Qiao Luming to provide supplementary explanations regarding the exclusion of the fund flows of its newly established subsidiary, Jinzhong Qiao Luming Auto Parts Co., Ltd., from the verification process as of June 30, 2025. Simultaneously, the special explanation for the fund flow verification must include specific details of the verification of large fund flows of Qiao Luming's actual controller and his father, spouse, siblings, etc., explaining the relationship between the counterparty and the verified entity, the reason or background of the transactions, etc., and updating and submitting the special explanation for the fund flow verification. The sponsoring institution must simultaneously provide working papers related to the fund flow verification and revenue authenticity verification.
The sustainability of Qiao Luming's performance growth was also one of the topics of inquiry by the Beijing Stock Exchange. Data shows that in 2023 and 2024, Qiao Luming's sales to BYD increased by 114.47% and 51.95% year-on-year, respectively, while in the first half of 2025, sales decreased by 0.63% year-on-year; however, the average selling price of Qiao Luming's supporting products to BYD showed a downward trend year by year.
The Beijing Stock Exchange requires Qiao Luming to explain the authenticity and rationality of the significant increase in sales to BYD in 2023 and 2024, taking into account the iteration of BYD's main models; and to explain the reasons for the decline in Qiao Luming's supply share to BYD from January to June 2025. Qiao Luming is required to explain the competitive advantages and disadvantages of his products compared to other suppliers of this customer, as well as whether the sales to BYD are stable and sustainable, whether there is a risk of being replaced by other suppliers, fully disclose the risks of declining sales to major customer BYD, and provide important information.
Regarding Geely Automobile's rapid sales growth, the inquiry letter requires demonstrations of the sustainability of this growth, focusing on aspects such as vehicle model compatibility, competitive advantages and disadvantages, and the ability to acquire new designated projects. Simultaneously, the letter demands attention to the reasonableness of the company's growth rate exceeding that of comparable companies, as well as the reasons for the slowdown in growth in the first half of 2025, requiring a comprehensive demonstration of performance sustainability in conjunction with industry trends and core competitiveness. Data shows that Qiao Luming's sales of OEM products for Geely Automobile increased from 45.1367 million units in 2022 to 82.4278 million units in 2024, representing a growth rate of 82.62%.
Supplementary explanation of the land use nature and compliance of the fundraising project.
The compliance of related-party transactions also requires further explanation. During the reporting period, Ningbo Shuangshen, acting as Qiao Luming's sales channel, received a total of RMB 1.425 billion in payments, exceeding the total transaction amount between the two parties by approximately RMB 188 million. The Beijing Stock Exchange requested an explanation of the reasonableness of this discrepancy and whether there was any misappropriation of funds. Furthermore, regarding the overlap between Qiao Luming and related party Mingbo Co., Ltd. in their clients such as BYD and Geely Automobile, as well as multiple suppliers, the inquiry letter requested detailed disclosure of the fairness of transaction prices, differences in products/procurement content, and an explanation of whether there was any transfer of benefits or advance payment of costs through related parties.
According to the application documents and responses to inquiries, Qiao Luming plans to raise 658.2017 million yuan, which will be used for the Qiao Luming New Energy Vehicle Intelligent and Lightweight Interior and Exterior Parts Intelligent Manufacturing Project (Phase I), the Automotive Lightweight Interior and Exterior Parts Intelligent Manufacturing Project (Phase I), and to supplement working capital with 50 million yuan. The former project has not yet obtained land use rights, while the latter project has obtained a "Real Estate Ownership Certificate" for the land, with the right type being sea area use rights, and the purpose being other industrial sea use. Meanwhile, from 2022 to the first half of 2025, the capacity utilization rates for plastic parts were 93.34%, 96.03%, 96.76%, and 97.71%, respectively, and the capacity utilization rates for luggage racks were 76.56%, 88.68%, 94.63%, and 93.77%, respectively.
The Beijing Stock Exchange requires Qiao Luming to provide supplementary information regarding the nature and compliance of the land use for the fundraising projects, the progress of land use rights and environmental impact assessment procedures, and any obstacles. He is also required to explain the necessity, rationality, and feasibility of each fundraising project, whether there are risks related to the absorption of new production capacity or idle equipment or sites, and to fully explain the impact of the completed projects on the company's operating performance. Furthermore, he is required to provide supplementary information on whether the calculations for supplementing working capital and the scale of financing are sufficient and objective, and whether there is any risk of idle funds.