What happened
Beijing Stock Exchange's 83rd review meeting is scheduled for Sept 4, 2026, to consider the IPO of Changde New Materials Technology. The company first filed with the Shenzhen Stock Exchange's main board in July 2022 seeking 1.169 billion yuan, was accepted for review in September 2023, responded to a second round of inquiry in January 2024, and then withdrew the application on July 1, 2024, with sponsor CSC Financial, prompting Shenzhen to end the review.
Ahead of the BSE hearing, Changde made two notable adjustments. On Aug 19, 2026, its board voted to cancel a working-capital supplement project and a multi-product line expansion project, reducing planned fundraising from 500 million yuan to 296 million yuan, a drop of roughly 40%. On Aug 25, ten days before the hearing, the board approved accounting-error corrections covering 2024, the first half of 2025, the full year 2025, and the first half of 2026, while saying the corrections do not affect the main financial data for those periods.
The filing also shows a profit squeeze. Revenue rose from 1.064 billion yuan in 2023 to 1.555 billion yuan in 2024, up 46.14%, and to 1.601 billion yuan in 2025, up just 2.96%. Net profit attributable to the parent was 79.7653 million yuan, 71.469 million yuan and 86.7585 million yuan over the same years, with 2024 profit falling 10.4%. Overall gross margin slid from 35.21% in 2022 to 19.91% in 2023 and 12.28% in 2025, partly because newer products such as ethyl acetate and polyether amine have been operating at very thin margins.
Why it matters
Changde's case shows the gap between revenue scale and sustainable profitability. Growth has been driven largely by low-margin products, while net profit has stagnated and gross margin has fallen sharply. The company also depends heavily on Sinopec, with raw and auxiliary material purchases from Sinopec accounting for 75.64%, 82.05% and 69.65% of total such purchases in the reported periods, including some core raw materials supplied through adjacent pipeline from Hunan Petrochemical.
The last-minute fundraising cut and accounting-error disclosure may heighten governance scrutiny. That is particularly notable because the company approved a 34.9699 million yuan cash dividend days before its initial filing audit cutoff, while it had also planned to use 77 million yuan of IPO proceeds for working capital. Removing that project and shrinking the raise could be seen as a response to such concerns.
Key facts
Changde Technology reduced planned IPO proceeds from 500 million yuan to 296 million yuan, dropping the working-capital supplement and multi-product line expansion projects.
Gross margin fell from 35.21% in 2022 to 19.91% in 2023 and 12.28% in 2025.
Purchases of raw and auxiliary materials from Sinopec represented 75.64%, 82.05% and 69.65% of total such purchases in the reported periods.
What to watch next
Whether the BSE listing committee approves Changde's IPO despite accounting-error corrections made just ten days before the hearing.
Whether the company can restore gross margins and reduce reliance on low-margin products and Sinopec supply.
Whether special investment clauses with Sinopec Capital, including a repurchase trigger if the company is not listed by Dec 31, 2029, come into play.