Jiadeli's IPO faces a dual dependency dilemma, with the actual controller providing free labor to related parties.

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Jadeli is rushing to list on the Shanghai Main Board. The company’s raw materials and production equipment heavily depend on a single overseas supplier. Additionally, the filing materials may have omitted information about related parties and the actual controller’s external part-time positions.

Quanzhou Jadeli Electronic Materials Co., Ltd. (hereinafter referred to as Jadeli) mainly engages in the research, production, and sales of BOPP (biaxially oriented polypropylene) electrical insulation films. BOPP electrical insulation films are specifically used for manufacturing film capacitors and for the production of composite copper foil anodes for current collectors, mainly applied in new energy vehicles, renewable energy, flexible direct current transmission, and other emerging fields.

Source: Visual China

High dependence on a single overseas supplier, switching main products to a new supplier would take 2 years

According to the prospectus, during the reporting period (2022 to 2024 and the first half of 2025), Borouge has consistently been Jadeli’s largest supplier. The company purchases polypropylene resin from Borouge, with procurement amounts of 248 million yuan, 238 million yuan, 280 million yuan, and 114 million yuan, accounting for approximately 87.5%, 85%, 81%, and 78% of total procurement in each period, respectively.

In response to the first round of inquiries, Jadeli mainly sources polypropylene resin produced by Nordic Chemical from Borouge, while also purchasing resin from other suppliers for trial production and sales. Nordic Chemical is one of the world’s leading polyolefin manufacturers. In China, it has not established a dedicated sales department but grants Borouge exclusive distribution rights for polypropylene resin products in China.

Jadeli states that domestic raw materials for capacitor films are mostly imported, mainly from Nordic Chemical, Hanwha Oil & Chemical, and Singapore TPC. Among these, Nordic Chemical’s products have a higher market share in China.

Among industry peers, companies like Copper Peak Electronics (600237.SH) and Haiwei Holdings (09609.HK) have multiple sources for electrical-grade polypropylene resin. For example, Haiwei sources from Hanwha Oil & Chemical and Singapore TPC. Some competitors also mainly purchase from Borouge.

Jadeli indicates that in the future, if it needs to switch raw material suppliers, it can do so within a relatively short period, but downstream customer application verification requires a certain cycle.

According to the second round of inquiry responses, the switching cycle could be as long as 2 years.

For ultra-thin films used in new energy vehicles, based on product development timelines and historical customer testing feedback cycles, the company estimates that after switching raw materials, product development takes about 2 months, customer verification about 4 months, so each development-to-verification cycle is approximately 6 months. Assuming three rounds of development and verification (small samples, small batches, large batches), the total would be 18 months. Considering the time needed for customer validation, final product stabilization and mass production would take about 2 years.

During the reporting period, Jadeli’s main business revenue was 550 million yuan, 528 million yuan, 728 million yuan, and 367 million yuan, respectively. Among these, ultra-thin films in BOPP electrical insulation films contributed revenues of 238 million yuan, 218 million yuan, 326 million yuan, and 183 million yuan, accounting for approximately 43.25%, 41.37%, 44.78%, and 49.67% of total main business revenue in each period, with the last period approaching 50%.

All 11 production lines are from the same supplier, with some projects under construction or involving “pre-approval construction”

In addition to the raw material dependence on Nordic Chemical (Borouge), Jadeli’s production equipment also relies on overseas suppliers.

The prospectus shows that Jadeli has 11 BOPP electrical insulation film production lines. Of these, 8 are operational, and 3 are under construction. All equipment suppliers are German company Brückner.

The first round of inquiry responses cite data from Zhuochuang Information, stating that in China’s BOPP electrical insulation film equipment market, imported equipment accounts for 85%, with Brückner’s equipment holding a 56% market share. Other market shares include Germany’s Lindor Dörner and France’s Masion.

The inquiry responses indicate that few domestic manufacturers produce BOPP electrical insulation film lines, including Beijing Xinghe Zhongchuang Technology Co., Ltd. and Beijing Mechanical Industry Automation Research Institute, mainly for medium-thick films. For ultra-thin films, alternative suppliers include Lindor Dörner and Masion. If Jadeli cannot procure lines from Brückner in the future, it can choose to buy from these manufacturers, though the switch would take longer.

High-end equipment supplied by line manufacturers is generally custom-made. Technical plans are usually finalized about 10 months before signing contracts, and engineering development to delivery takes approximately 36 months. Jadeli believes it has the capability to modify lines and equipment. Procuring new lines from other suppliers, aside from the long delivery times, is not particularly difficult.

Notably, the “Line 7 and Line 8 projects” are among Jadeli’s disclosed projects under construction, with balances of 13,400 yuan, 25.5921 million yuan, and 137 million yuan as of the end of 2023, 2024, and June 2025.

However, according to the Quanzhou Taiwan Investment Zone official website, as of January 23, 2025, the local administrative approval bureau only issued environmental impact assessment approvals for Jadeli’s new ultra-thin BOPP materials production lines (Quanzhou Taiwan Zone Environmental Review [2025] No. 9).

Actual controller applies for 14 patents as related parties; IPO filing materials may have omissions

Huang Yanhuang is one of Jadeli’s actual controllers, serving as a director, deputy general manager, and core technical staff. His father, Huang Huanming, is the chairman, and his mother, Huang Bifen, was a director before November 2022.

Quanzhou Huadong Power Equipment Co., Ltd. (hereinafter Huadong Power) is owned 100% by Huang Huanming, Huang Bifen, Huang Yanhuang, and his wife Hong Yunyu. It mainly operates in air compressor business. Huang Yanhuang holds 40% of Huadong Power’s shares; Huang Bifen is a director and financial officer; Hong Yunyu is general manager.

Patent disclosures show that from April 12, 2023, to April 15, 2024, Huang Yanhuang participated in applying for 14 patents related to Huadong Power, including “High-efficiency Energy-saving Compressor” (CN202320828566.8), “Dust-proof Structure for Compressors” (CN202320828095.0), and “Portable Air Compressor” (CN202420607749.1), with Huang Yanhuang as the first inventor.

During this period, was Huang Yanhuang兼职 at Huadong Power?

The prospectus states that from January 2007 to January 2012, Huang Yanhuang served as head of Huadong Power’s production department; from February 2012 to March 2024, he was responsible for Jadeli’s equipment and engineering department, as well as a director and deputy general manager; since March 2024, he has been a director and deputy general manager of the company.

In other words, after 2012, Huang Yanhuang has not held a position at Huadong Power. This conflicts with the fact that during the reporting period, the actual controller applied for numerous patents while supposedly not兼职 at Huadong Power. The prospectus shows that in 2024, Huang Yanhuang received a salary of 1.8 million yuan from Jadeli and did not draw a salary from related parties.

Additionally, Jadeli’s prospectus identifies Quanzhou Huade Mechanical and Electrical Equipment Co., Ltd. (hereinafter Huade Mechanical) and its controlling subsidiary Fujian Wukong Cloud Intelligent Technology Co., Ltd. as related parties.

According to business registration info, Fujian Huade Compressor Technology Co., Ltd. (hereinafter Huade Compressor) was established on October 24, 2025, as a wholly owned subsidiary of Huade Mechanical. The directors, managers, and financial officers of Huade Compressor include Huang Zehua, who is the brother of another Jadeli actual controller, Huang Zezhong.

According to the Shanghai Stock Exchange Listing Rules Article 6.3.3, Huade Compressor, which has Huang Zehua as director and senior manager, should also be considered a related party of Jadeli.

Jadeli’s IPO application and legal opinion drafts were signed on March 6, 2026, and February 25, 2026, respectively. The two rounds of inquiry responses were signed on January 13 and February 25, 2026, both well after Huade Compressor’s establishment date. However, the IPO filing materials do not disclose any information related to Huade Compressor.