Financial Crisis Analysis Report of Shijing Technology (301030.SZ) for its Cross-Border Photovoltaic Business

Shijing Technology (Stock Code: 301030.SZ) was founded in 2005, is a high-tech enterprise focusing on process pollution prevention and control equipment, and listed on the ChiNext in 2021. Its traditional main business is the R&D, production and sales of process pollution prevention and control equipment, end-of-pipe pollution treatment equipment and remote online monitoring systems for industries such as pan-semiconductor, photovoltaic, and precision manufacturing [1].

In late 2023, Shijing Technology officially entered the photovoltaic sector, established Anhui Shijing Photovoltaic Energy Technology Co., Ltd., and built high-efficiency solar cell production lines. The background of this cross-border transformation decision was that the PV industry was at a boom peak at that time, with strong profitability across all links of the industrial chain. However, just as the company invested heavily in building PV production capacity, the industry’s supply and demand pattern changed drastically, leading the company into the embarrassing situation of “losing money as soon as production starts” [2].

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Based on public financial data, Shijing Technology’s financial situation has continued to deteriorate in recent years:

Financial Indicator	2024 Data	Year-on-Year Change	First Three Quarters of 2025	Year-on-Year Change
Operating Revenue	RMB 2.055 billion	-40%	RMB 1.111 billion	-65.44%
Net Profit	RMB 771 million loss	Turned from profit to loss	RMB 226 million loss	-256.77%
Asset-Liability Ratio	Over 90%	Sharply rose	-	-
Accounts Receivable	-	-	RMB 1.646 billion	1.5 times of operating revenue

The company recorded its first annual loss since listing in 2024, and the loss further expanded in 2025. Its single-quarter operating revenue in Q3 2025 was only RMB 53.9223 million, plummeting 95.4% month-on-month and 83.25% year-on-year, indicating a continuous deterioration of its operating conditions [2].

Shijing Technology’s business composition and gross profit margin show a worrying “double whammy” pattern:

• In 2024, PV product revenue reached RMB 644 million, accounting for 31.35% of total revenue, but
  gross profit margin plummeted to -40.26%
• In H1 2025, PV product revenue was RMB 441 million, accounting for 41.71% of total revenue, but the gross profit margin still stood at
  -23.87%
• Core subsidiary Anhui Shijing Photovoltaic Energy Technology Co., Ltd. recorded a net loss of RMB 72.1612 million in H1 2025

• In 2024, revenue of the traditional business was approximately RMB 1.4 billion,
  gross profit margin once dropped to -1.3%
• In H1 2025, revenue reached RMB 541 million,
  gross profit margin recovered to 29.98%
  , but fell sharply by 70.29% year-on-year

From the gross profit margin structure, two key issues can be seen: first, the continuous negative gross profit margin of the PV business has severely eroded profits; second, the traditional core business has seen a sharp 70% drop in revenue due to market contraction, resulting in the loss of economies of scale [1][2].

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From 2024 to 2025, China’s PV industry experienced an unprecedented industry-wide winter. According to industry data, the prices of all links in the PV industrial chain dropped by 66%-88% compared to the highest point since 2020, and the entire industrial chain fell into a large-scale loss state. In 2024, only 31 A-share listed PV main industrial chain companies recorded a total net loss of RMB 57.47 billion; in Q1 2025, these 31 companies recorded a combined net loss of over RMB 12.58 billion, a year-on-year increase of 270% [1].

Compared with first-tier PV enterprises, cross-border enterprises generally face three major disadvantages:

1. Weak overseas channels
   : After the price war broke out first in the domestic market, enterprises with leading overseas market development gained a certain buffer, but cross-border enterprises generally have weak overseas layouts
2. Single technical route
   : Most cross-border enterprises chose the TOPCon technical route, lacking differentiated competitive advantages
3. Obvious cost disadvantages
   : Without economies of scale and full industrial chain synergy capabilities, they are at a disadvantage in price wars

As an industry insider put it: “The most direct reason is that the industrial chain prices have dropped too much, and cross-border enterprises without cost and overseas channel advantages quickly entered a state of negative gross profit and cash loss” [1].

The specific difficulties faced by Shijing Technology in its cross-border PV business include:

• Unfavorable timing
  : The first batch of products rolled off the production line only in late 2023, which coincided with the most intense period of the PV price war
• Excessive investment scale
  : The upfront fixed asset investment has formed a large depreciation pressure
• Tight capital chain
  : The asset-liability ratio exceeds 90%, making it difficult to sustain losses

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Shijing Technology’s current financial situation has already raised red flags:

Risk Indicator	Data	Risk Rating
Asset-Liability Ratio	Over 90%	Extremely High Risk
Short-Term Debt Repayment Pressure	Huge	High Risk
Accounts Receivable Turnover	RMB 1.646 billion / 1.5 times of operating revenue	Severe Capital Occupation
Credit Impairment Loss	RMB 125 million (First Three Quarters of 2025)	Continuous Profit Erosion

Even more severely, the company’s actual controller Zhu Ye has pledged almost all of his shares, and the company’s RMB 420 million private placement fundraising plan (for supplementing working capital and repaying bank loans) disclosed in August 2024 was also terminated in March 2025 [2]. After the failure of the private placement, the company has to seek “bailout” from state-owned institutions to resolve the capital crisis.

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In 2024, the PV business’s gross profit loss exceeded RMB 250 million, and there is no sign of a profit inflection point in the short term. This loss will continue to expand before the industry’s capacity clearing is completed (expected to be 2026-2027).

An asset-liability ratio exceeding 90% means the company can no longer provide continuous investment for the PV business through debt financing; the failure of the private placement has blocked the equity financing channel.

The process pollution prevention and control equipment business still maintains a gross profit margin of around 30%, which is the company’s business area with real competitiveness. Continuing to maintain the PV business will only drag down the resource investment in the traditional business.

Almost all shares are pledged, private placement failed, and the introduction of strategic investors fell through, indicating that the company has fallen into a liquidity crisis and must make strategic choices.

If the PV business is spun off now, the upfront fixed asset investment will face large-scale impairment, and the expected impairment loss may reach hundreds of millions of yuan, severely impacting the company’s net assets.

The PV business accounts for more than 40% of total revenue, and a sudden spin-off will lead to a sharp shrinkage of revenue scale, which may trigger delisting risks.

In the second half of 2025, PV industrial chain prices showed signs of stabilizing, and industry analysts expect capacity clearing to be completed in 2026-2027. Exiting before the dawn may result in cutting losses at the bottom.

Cross-border PV enterprises generally face problems such as discounted equipment sales, employee placement, and customer defaults, and the exit cost may exceed expectations.

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Based on the above analysis, this report recommends that Shijing Technology adopt a

strategy, rather than simple business spin-off. The specific recommendations are as follows:

• Suspend all expansion plans for the PV business, and no longer add any investment
• Maintain the minimum operation of existing PV production capacity to avoid impairment from equipment idling
• Actively introduce state-owned institutions or industrial investors as strategic shareholders to resolve the capital crisis
• Consider selling part of the equity of the PV subsidiary to introduce partners with industry resources

• Conduct a comprehensive impairment test on PV-related assets and accrue impairment losses in one go
• Negotiate debt extension or restructuring with creditors to relieve short-term debt repayment pressure
• Recover part of the cash through asset disposal to improve liquidity

• Concentrate resources on the traditional advantageous business of process pollution prevention and control equipment
• Increase market development efforts for the traditional business to make up for the revenue gap caused by the shrinkage of the PV business
• Utilize the high gross profit margin feature of the traditional business to restore profitability

• Wait until the PV industry’s capacity clearing is completed and the industry pattern stabilizes (expected to be 2026-2027)
• Reassess whether to integrate PV resources through mergers and acquisitions instead of building production capacity by itself
• If the industry environment continues to deteriorate, consider permanently exiting the PV sector

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The decision of Shijing Technology to expand into the PV business was not strategically inappropriate (the industry was in a boom cycle at that time), but the implementation timing encountered drastic changes in the industry cycle, leading the company into a severe predicament.

, the core view of this report is:

Shijing Technology should consider “strategic contraction” instead of simple business spin-off. It is recommended to implement it in steps: ① Suspend expansion → ② Introduce strategic investors → ③ Asset impairment → ④ Focus on main business → ⑤ Reassess PV business when the time is mature.

This gradual exit strategy can maximize the protection of shareholder interests while retaining strategic flexibility for the company’s future. The PV industry is still in a deep reshuffle stage; radical exit may result in cutting losses at the bottom, while maintaining the status quo will continue to consume limited resources. Therefore, suspending expansion, introducing external resources, and focusing on traditional advantageous businesses are the most pragmatic and rational strategic choices at present.

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[1] Securities Times - “Cross-Border PV Expansion by Listed Companies Fades, Capacity Clearing Progress Becomes Focus” (https://www.stcn.com/article/detail/1828726.html)

[2] Securities Star - “Hundred Billion PV Gamble Fails, Shijing Technology’s Third Quarterly Report Plunges 256%” (https://finance.sina.com.cn/stock/s/2025-11-27/doc-infyvthh8308813.shtml)