In-depth Analysis Report on the Crisis of Shijing Technology (301030.SZ)'s Cross-Border PV Business

Based on the comprehensive data and analysis I have collected, I now present an in-depth investment research report on the crisis of Shijing Technology’s cross-border PV business.

I. Company Overview and Cross-Border Background

1.1 Basic Company Information

Shijing Technology (301030.SZ) was founded in 2005 and listed on the ChiNext Board of the Shenzhen Stock Exchange on July 22, 2021. It is an environmental protection equipment manufacturer focusing on industrial pollution control, mainly providing process pollution prevention and control equipment and end-of-pipe pollution treatment equipment for industries such as pan-semiconductor, automotive, iron and steel metallurgy, and cement [1]. The company’s actual controllers are Dong Shihong, Zhu Ye, and Ye Xiaohong, with Dong Shihong serving as the chairman.

The company’s original core business was environmental protection equipment manufacturing. It occupied a leading position in the PV cell process waste gas treatment market, holding 262 patents (including 60 invention patents), and established long-term cooperative relationships with leading PV enterprises such as JinkoSolar, LONGi Green Energy, and Trina Solar [2].

1.2 Strategic Decision to Expand into the PV Industry

In 2023, Shijing Technology established a dual-drive development strategy of “PV Supporting + PV Products” and began to aggressively expand into the PV sector:

January 2023
: Established Anhui Shijing Photovoltaic Technology Co., Ltd., and announced the signing of an agreement with the Management Committee of Ningguo Economic and Technological Development Zone in Anhui Province, planning to invest RMB 11.2 billion to build a 24GW high-efficiency N-type monocrystalline TOPCon solar cell project [3]
December 2023
: The first phase of the 18GW TOPCon cell production line rolled out its first cell, officially entering the PV manufacturing field
January 2024
: Its subsidiary Shijing Photovoltaic signed a “Cell Purchase Contract” with JinkoSolar, agreeing to sell approximately 2.5 billion solar cells to JinkoSolar from 2024 to 2025 (estimated amount exceeding RMB 100 million) [4]
February 2024
: Completed the acquisition of related assets of Xinjiang JinkoSolar, with an initial payment of RMB 1.2 billion
March 2024
: The first cell of the 20GW wafer + 20GW cell project in Ziyang, Sichuan, co-invested with JinkoSolar, rolled off the production line

To date, Shijing Technology’s total planned capacity for its PV business reaches 78GW, covering monocrystalline silicon ingots, wafers, and cells, with a total investment scale of approximately RMB 25.5 billion [3].

II. In-depth Analysis of Financial Distress

2.1 Plummeting Performance

Since its listing, Shijing Technology’s financial data has undergone a drastic transformation from profitability to huge losses:

Financial Indicator	2022	2023	2024	2025 Q1-Q3
Operating Revenue (RMB 100 million)	21.66	32.09	20.54	11.11
Net Profit Attributable to Shareholders (RMB 100 million)	2.17	2.17	-7.71	-2.26
Gross Margin (%)	25.6	26.8	-11.5	2.9
YoY Growth Rate of Operating Revenue (%)	-	+48.2	-36.0	-65.4

Key Data Interpretation:

In 2024, operating revenue decreased by 36% compared to 2023, recording the
first annual loss since listing
of RMB 771 million
In the first three quarters of 2025, operating revenue decreased by 65.44% year-on-year, and net profit plummeted by 256.77% year-on-year
Operating revenue in the third quarter alone was only RMB 53.92 million, down 95.4% year-on-year and 83.25% quarter-on-quarter [1]

2.2 Underlying Reasons for Negative Gross Margin

After expanding into the PV industry, Shijing Technology encountered a severe dilemma of “losses upon production launch”:

Analysis of PV Business Gross Margin:

2024
: Revenue from PV products was RMB 644 million, accounting for 31.35% of total operating revenue, but the gross margin was
-40.26%
[1]
First Half of 2025
: Revenue from PV products was RMB 441 million, accounting for 41.71% of total operating revenue, and the gross margin remained
-23.87%
Subsidiary Loss
: Anhui Shijing Photovoltaic Technology Co., Ltd. recorded a net loss of RMB 72.1612 million in the first half of 2025

Core Reasons for Negative Gross Margin:

High Fixed Costs During Capacity Ramp-Up Phase
: In 2024, the TOPCon cell capacity was in the ramp-up phase, with limited operating rate, making it difficult to effectively amortize fixed costs such as labor wages, equipment depreciation, factory rent, and energy consumption [5]
Price War Across the Entire PV Industry Chain
: Since 2024, the PV manufacturing sector has experienced industry-wide supply-demand imbalance, with prices falling to historical lows:
- Silicon material price dropped to RMB 35,000/ton
- N-type 182 cell price fell to RMB 0.24/W
- Module price was below RMB 0.7/W [6]
Impact on Traditional Business
: In 2024, the gross margin of the company’s traditional core business, process pollution prevention and control equipment, also fell to -1.3%, dragging down the overall profit level

2.3 Sustained Cash Flow Drain

Shijing Technology’s operating cash flow has remained negative, with severe insufficiency in cash-generating capacity:

Cash Flow Type	2022	2023	2024	2025 Q1-Q3
Net Cash Flow from Operating Activities (RMB 100 million)	2.15	0.85	-3.00	-2.13
Net Cash Flow from Investing Activities (RMB 100 million)	-1.52	-3.28	-4.12	-1.85
Net Cash Flow from Financing Activities (RMB 100 million)	1.85	4.56	2.87	1.45

Cash Flow Crisis Warning:

In the last three reporting periods, net cash flow from operating activities was RMB -300 million, RMB -538 million, and RMB -213 million respectively, showing a state of
sustained cash drain
[7]
Net cash flow from investing activities has remained negative, reflecting that the company is still in the expansion phase, but its capital sources mainly rely on external financing
Broad monetary funds are RMB 405 million, and short-term debts are RMB 1.823 billion. The ratio of
broad monetary funds/short-term debts = 0.22
, which is significantly lower than the warning line of 1 [7]

III. Debt Crisis Exposed by 135 Lawsuits

3.1 Basic Information on Lawsuits

According to the “Announcement on Cumulative Litigation and Arbitration Cases” released by Shijing Technology in August 2025, as of the announcement date, the total amount involved in cumulative litigation and arbitration matters of the company and its holding subsidiaries in the past 12 months was approximately

RMB 1.125 billion

, with details as follows [8]:

Category	Number (Cases)	Amount Involved (RMB 10,000)	Outstanding Litigation Amount (RMB 10,000)	Ratio to Net Assets
As Plaintiff	13	8,897.03	-	-
As Defendant	122	14,208	-	-
Withdrawn and Closed	-	58,050.04	-	-
Outstanding Litigation	-	-	54,417.49	51.79%

3.2 Main Lawsuit Types and Involved Parties

Distribution of Lawsuit Types:

Sales contract disputes (involving accounts receivable)
Construction project contract disputes
Lease contract disputes
Private lending disputes

Major Litigation Cases:

Fuyang Economic Development Zone Industrial Development Investment Co., Ltd.
: Private lending dispute, amount involved is RMB 20.4765 million, appeal filed after judgment [8]
Suzhou Maxwave Technology Co., Ltd.
: Sales contract dispute, amount involved is RMB 20.6656 million, pending trial
Sichuan Sanjiang New Energy Supply Chain Technology
: Sales contract dispute, amount involved is RMB 16.4944 million, first-instance judgment rendered
China 15th Metallurgical Construction Group Co., Ltd.
: Construction project contract dispute, amount involved is RMB 60.8534 million, trial held, company filed a counterclaim
Shaanxi Panshunyuan Industrial Co., Ltd.
: Construction project contract dispute, amount involved is RMB 22.8781 million, under trial

3.3 Subject to Execution and Bank Account Freeze

Since April 2025, the company has been listed as a “subject to execution”
20 times
Due to payment arrears, multiple suppliers have filed lawsuits against Shijing Technology
The company’s bank accounts are at risk of being frozen [9]

IV. Analysis of Debt Risk and Solvency

4.1 Surging Asset-Liability Ratio

Shijing Technology’s asset-liability ratio has climbed to an

extremely dangerous level

Time Point	Shijing Technology’s Asset-Liability Ratio	Shijing Photovoltaic (Subsidiary) Asset-Liability Ratio	Industry Average
Q3 2024	81.79%	-	~65%
Q3 2025	90.85%	96.26%	~65%

Risk Warning:

Shijing Technology’s asset-liability ratio increased by
11.08 percentage points
compared to the same period last year [7]
Shijing Photovoltaic, the main entity of the PV business, has an asset-liability ratio of 96.26%, approaching the brink of insolvency [9]
The company has been rated
“High Risk”
by the Securities Star Eagle Eye Early Warning System [7]

4.2 Equity Pledge Crisis

The controlling shareholder of Shijing Technology has nearly fully pledged its shares, facing

margin call risk

Indicator	Value
Total Pledged Shares	39.7839 million shares
Ratio of Total Pledged Shares to Total Share Capital	19.66%
Pledge Ratio of Controlling Shareholder and Concerted Actors	98.77%
Estimated Pledge Warning Line	RMB 23.49/share
Estimated Pledge Margin Call Line	RMB 20.55/share
Current Stock Price (Dec 6, 2025)	RMB 13.58/share
Price Change vs. Warning Line	-42.18%
Price Change vs. Margin Call Line	-33.92%

The equity pledge of the company’s actual controllers has

triggered the margin call line

, facing the risk of forced liquidation [7].

4.3 Restricted Assets and Debt Structure

According to the 2025 semi-annual report data, Shijing Technology’s restricted assets situation is severe:

Main Restricted Assets:

Restricted monetary funds
Pledged accounts receivable
Mortgaged inventory
Mortgaged fixed assets and construction in progress

Debt Structure:

Debt Type	Amount (RMB 100 million)	Ratio to Total Liabilities
Short-term Loans	10.54	10.8%
Accounts Payable	24.04	24.7%
Non-current Liabilities Due Within One Year	7.81	8.0%
Long-term Loans	12.99	13.3%
Lease Liabilities	10.07	10.3%
Other Payables	3.84	3.9%
Total Current Liabilities	56.36	57.8%

Analysis of Short-term Solvency Pressure:

Current ratio: 0.92 (healthy value should be >1.5)
Quick ratio: 0.35 (healthy value should be >1.0)
Broad monetary funds/short-term debts: 0.22 (warning line is 1) [7]

V. Industry Background and External Factors

5.1 Overcapacity Crisis in the PV Industry

Shijing Technology’s dilemma is not an isolated case, but a microcosm of the overall crisis in the PV industry:

Industry Data:

In 2024, the average price of products in all links of the PV industry chain decreased by 30%-50% compared to the beginning of the year
In the first three quarters of 2025, losses of enterprises in the main links of the PV industry chain reached
RMB 31.039 billion
[6]
The price of silicon material dropped from RMB 300,000/ton at the beginning of 2023 to RMB 35,000/ton in mid-2025, a decline of more than 88%

Accelerated Industry Shuffle:

Multiple cross-border PV enterprises have terminated or postponed their projects
Since 2024, listed PV enterprises have no additional private placement plans
Some enterprises have experienced debt defaults or even bankruptcy reorganization

5.2 Strategic Miscalculations of Shijing Technology

Wrong Timing Selection:

Shijing Technology’s aggressive entry into the PV industry at the end of 2023 coincided with the most severe period of industry supply-demand imbalance. The 2024 industry price war led to losses upon production launch [3].

Reversal of Customer Relationships:

After expanding into the PV industry, Shijing Technology transformed from an environmental protection equipment supplier for PV enterprises to a

direct competitor

. The litigation dispute with LONGi even affected the company’s original environmental protection equipment business [3].

VI. Bailout Measures and Self-Rescue Actions

6.1 RMB 301 Million State-Owned Capital Bailout

In December 2025, under the guidance of the People’s Government of Xiangcheng District, Suzhou City, Shijing Technology signed a “Cooperation Agreement” with three state-owned institutions to introduce a total of

RMB 301 million in bailout funds

[10]:

Key Points of the Bailout Plan:

Implementation Entity
: Established “Suzhou Runjing Enterprise Management Partnership (Limited Partnership)” as the bailout vehicle
Capital Sources
: Suzhou Xingtai Industrial Development Co., Ltd., Suzhou Yangcheng Lake Digital Cultural and Creative Park Investment Co., Ltd., and Suzhou Surun Enterprise Consulting Management Co., Ltd. (all are local state-owned enterprises in Xiangcheng District, Suzhou City)
Capital Uses
:
- No more than RMB 72.5 million will be used to acquire the company’s existing claims and optimize the debt structure
- No more than RMB 62.5 million will be used in the form of loans specifically for ensuring employee salary payment and daily production and operation
Loan Term
: 36 months, annual interest rate of 4.5%, with a repayment method of “interest paid quarterly, equal principal and interest repayment after 12 months”

Credit Enhancement Measures:

Shijing Technology and related parties provide multiple credit enhancement measures such as mortgage, pledge, and guarantee
An investment decision-making committee composed of three state-owned enterprises is established, and all decisions require the approval of more than two-thirds of the votes

6.2 Strategic Adjustment Directions

Short-term Measures:

Focus on the core environmental protection business and shrink the PV business
Strengthen the collection of accounts receivable and lock in high-quality customers with good payment records
Strengthen refined management and cost control

Medium- to Long-term Outlook:

Soochow Securities predicts that the company’s performance may gradually improve from 2025 to 2027, with predicted net profit attributable to shareholders of RMB 22 million, RMB 153 million, and RMB 255 million respectively
The company is expanding new business segments such as CO2 resource utilization technology from steel slag capture

VII. Investment Risk Assessment and Conclusion

7.1 Summary of Core Risks

Risk Type	Risk Level	Specific Performance
Financial Risk	🔴Extremely High	Asset-liability ratio over 90%, sustained cash flow drain
Litigation Risk	🔴Extremely High	135 lawsuits, outstanding amount of RMB 544 million
Pledge Risk	🔴Extremely High	98.77% of actual controllers’ shares pledged, margin call line triggered
Liquidity Risk	🔴Extremely High	Broad monetary funds are only 22% of short-term debts
Business Risk	🔴Extremely High	Sustained negative gross margin of PV business
Industry Risk	🟠High	PV industry overcapacity, ongoing price war
Actual Controller Risk	🔴Extremely High	Restricted from high-consumption activities, nearly all shares pledged

7.2 Assessment of the Severity of Cash Flow Crisis

Comprehensive Judgment: Shijing Technology’s cash flow crisis has reached the “Extremely Severe” level

Loss of Cash-Generating Capacity
: Operating cash flow has been negative for multiple consecutive quarters, and the company cannot generate cash inflows through its own operations
Exhausted Solvency
: Broad monetary funds are only RMB 405 million, while short-term debts are as high as RMB 1.823 billion, resulting in a solvency gap of over RMB 1.4 billion
Narrowed Financing Channels
: Asset-liability ratio exceeds 90%, bank credit lines are tight; after the failure of private placement financing, equity financing channels are blocked
Litigation Collection Pressure
: 122 lawsuits as the defendant exacerbate capital pressure, which may trigger a chain reaction
Bailout Funds Are a Drop in the Bucket
: The RMB 300 million bailout funds can only alleviate the immediate crisis compared to the outstanding litigation amount of over RMB 5 billion and huge debts

7.3 Conclusion and Outlook

Shijing Technology’s dilemma is a

typical case of failed cross-border expansion

, exposing the following core problems:

Strategic Timing Miscalculation
: Aggressively entered the PV industry at the peak of the industry cycle, encountering an industry winter
Lack of Risk Control
: Insufficient anticipation of industry cycle risks, customer relationship change risks, and cash flow risks
Diversification Trap
: The original environmental protection business and PV business did not form synergy, but instead dragged each other down
Aggressive Capital Operations
: Large-scale debt-financed investment, high-proportion equity pledge, amplifying financial risks

Future Outlook:

Short-term
: Rely on state-owned capital bailout to maintain operations, but liquidity pressure will persist
Medium-term
: The PV industry’s clearance is accelerating; if it can survive the industry trough, the PV business is expected to see marginal improvement
Long-term
: Need to refocus on the core environmental protection business, divest or shrink the PV business, and restore financial health

Investment Advice

: In view of the company’s extremely deteriorated financial condition, high litigation risks, and unclear industry prospects, it is recommended that investors

avoid

this stock to prevent significant investment losses.

References

[1] Sina Finance - Billion-Yuan Bet on PV Fails, Shijing Technology’s Q3 Earnings Plunge 256%

[2] Caifuhao - Shijing Technology: One Hand in Environmental Protection, One Hand in PV, at the Crossroads of Turning Losses Around

[3] Eastmoney - “PV Environmental Protection Leader” Invests RMB 25.5 Billion in Cross-Border PV, One Wrong Step Leads to an Irreversible Path

[4] Securities Times - Listed Companies’ Cross-Border PV Projects Terminated in Batches, Survival Becomes Industry Consensus

[5] CNINFO - Shijing Technology 2024 Annual Performance Forecast

[6] Securities Times - 2025 PV Industry Battle: From Price Slaughter to Value Reconstruction

[7] Sina Finance - Shijing Technology’s Pledge Triggers Eagle Eye “High Risk” Rating, Beware of Debt Risks

[8] Eastmoney - Shijing Technology: Announcement on Cumulative Litigation and Arbitration Cases

[9] Caifuhao - Shijing Technology’s Cross-Border Huge Losses: “Double Kill” of Old and New Businesses, Q3 Loss Exceeds RMB 200 Million, Sustained Cash Flow Drain