Darbond Technology Co., Ltd.

All figures are in CNY under PRC Accounting Standards for Business Enterprises. FY2023–FY2025 are from the FY2025 annual report; FY2021–FY2022 are from the IPO prospectus and FY2022 annual-report data. The preliminary FY2025 results (express report, February 2026) gave net profit of CNY 105.26 M; the audited annual report gives CNY 107.61 M, which is used throughout.

Income statement

(Zero entries in FY2021–FY2022 for operating and pre-tax profit mark periods outside the three-year comparative window of the latest filings; they are not reported values.)

FY2025 dividend = CNY 0.10 interim + CNY 0.15 final. FY2023 EBITDA and dividend are shown as zero only as table placeholders. The FY2024 final dividend was CNY 2.50 per 10 shares.

Margins (%)

Revenue CAGR FY2021–FY2025: 27.6%. FY2020–FY2025 CAGR is about 30% (from CNY 417 M).

Commentary. Three phases are visible. (1) FY2021–FY2022: hyper-growth (+59% in FY2022) driven by EV-battery adhesives, with new-energy revenue up 121% in FY2022 and net margins near 13%. (2) FY2023: a stall — revenue flat at CNY 932 M as new-energy prices fell faster than volumes rose and consumer electronics destocked; gross margin slipped to 28.8%. (3) FY2024–FY2025: re-acceleration (+25%, +33%) led by IC and smart terminals, but profit grew only modestly. FY2024 net profit fell 5.4% on new-energy margin compression (segment gross margin −6.1 pp to 15.2%), restricted-stock expense, and higher spending on overseas market development, IT and R&D. FY2025 net profit rose 10.5% against revenue up 32.6%; core (non-recurring-adjusted) profit rose a healthier 19.1%. Q4 FY2025 net profit was CNY 37.9 M (+2.4% YoY), below sell-side expectations of about CNY 157 M for the full year.

Quarterly trajectory

9M2026 (Q3 report, 23 October 2026): revenue CNY 1,423 M (+30.5%), net profit CNY 106.0 M (+52.7%), core net profit CNY 100.0 M (+49.9%), operating cash flow CNY 103 M, EPS CNY 0.76. Q3 2026 alone: revenue CNY 542.7 M (+35.7%), net profit CNY 38.4 M (+59.0%). Q1 2026 gross margin was 26.99% (+0.05 pp YoY, +0.62 pp QoQ). The 2026 pattern shows the operating leverage FY2025 lacked: profit growth now exceeds revenue growth by about 20 percentage points.

Balance sheet

(Zero cells are table placeholders for items not carried in the three-year comparative summary.)

At 30 September 2026, total assets were CNY 3,708 M (+7.6% YTD) and parent equity CNY 2,402 M (+3.3%). At 31 March 2026: cash CNY 497.7 M, trading financial assets CNY 384.3 M, notes receivable CNY 124.2 M, accounts receivable CNY 412.3 M, inventory CNY 279.1 M. The balance sheet remains conservatively financed: the debt-to-asset ratio was about 22% through FY2024–Q1 2025, there are no bonds outstanding, and in September 2026 the board authorised up to CNY 700 M of idle own funds for cash management. Liabilities rose in FY2025 mainly through operating payables, minority interests and deferred consideration from the Techinno deal. The 20% final tranche of Techinno consideration is payable after the earn-out period.

Goodwill and intangibles. The Techinno purchase (CNY 257.78 M for 89.42%, against a valuation of CNY 288.4 M for 100% and audited attributable book equity of CNY 51.66 M at 30 September 2024) created the group's main goodwill and acquired-intangible balance. It is protected by an earn-out: Techinno must deliver cumulative net profit of at least CNY 36 M over the commitment period and at least CNY 14 M in 2026, or the sellers compensate Darbond. Techinno earned CNY 12.8 M in FY2025.

Cash flow

The FY2024 dividend (CNY 2.50 per 10 shares on about 140.9 M shares) is approximately CNY 35 M. The FY2025 total of CNY 35.16 M equals 32.67% of net profit. FY2024 buyback cash is as of 31 October 2024; the FY2025 figure is the second programme's CNY 40.01 M through January 2026.

Commentary. Operating cash flow is volatile and was negative in FY2025 (−CNY 100.6 M, including −CNY 90.7 M in Q4) as accounts receivable more than doubled (+116%) on fast growth in longer-term IC and smart-terminal accounts and greater use of notes and supply-chain settlement by battery customers. FY2024's CNY 379 M inflow reflected aggressive collection plus inventory release. 2026 has normalised: H1 OCF +CNY 28.3 M (vs. −CNY 18.2 M), and 9M OCF +CNY 103 M. Capex peaked in FY2023–FY2025 with the Kunshan, Meishan and Thailand bases; the South China semiconductor base (about CNY 230.5 M, of which about CNY 62.4 M is reallocated IPO proceeds) is the main 2026–2027 project.

Ratios

FY2025 debt-to-asset includes minority interests in liabilities; on a parent-equity basis the leverage is lower. The current ratio for FY2025 is a sell-side estimate. Zero cells are placeholders.

Net debt is negative (net cash of roughly CNY 850 M including wealth-management products at FY2025 year-end), so net debt/EBITDA and interest coverage are not meaningful; finance expense was a net income of about CNY 9 M in FY2024. ROE in the 4–5% range is the company's chief financial weakness: the IPO raised CNY 1.64 B of equity that is not yet fully earning. Consensus-style forecasts imply ROE recovering towards 8–11% by FY2026–FY2027 if 2026 momentum holds.

Management guidance. No numeric guidance is given. Management expects IC packaging and smart-terminal materials to keep outgrowing the group, new energy to hold share and grow with the industry, and high-end equipment to grow steadily. Priorities for 2026–2027 are volume ramp of chip-level materials (TIM1, underfill, DAF/CDAF, lid adhesive), AI-server TIMs, construction of the South China semiconductor base, integration of Techinno and Guangxi Lanpo, and overseas (Thailand/Vietnam) expansion.

Consensus growth expectations. Published forecasts imply FY2026 revenue of about CNY 1.95–2.05 B (+26–30%) and net profit of CNY 177–230 M. 9M2026 results (revenue +30.5%, NP +52.7%) support the revenue path; profit is tracking below the forecast range.

Bull case.

1. AI thermal and advanced-packaging leverage. IC revenue nearly doubled to about CNY 250 M in FY2025. With TIM1 validated and three chip-level products in small-batch supply, IC could exceed 20% of sales in FY2026–FY2027 at around 40% gross margin, lifting group margins.

2. Operating leverage has arrived. 9M2026 net profit growth (+52.7%) is 22 points above revenue growth, and OCF has turned positive (+CNY 103 M). Spare capacity at Kunshan, Meishan and Thailand means incremental revenue drops through at high marginal rates.

3. Overhang clearing and insider conviction. Big Fund is down to 10.65% from 18.65%, Zhoushan Taizhong is below 5%, and the founders cancelled their November 2026 sale with zero shares sold while the company keeps buying back stock.

Bear case.

1. New-energy drag persists. At 52% of revenue and around 15% gross margin, continued battery and PV price deflation can absorb most IC gains; the Yantai new-energy subsidiary lost CNY 13.6 M in FY2025.

2. Returns stay sub-par. ROE of 4–5% on CNY 2.4 B of equity does not justify a 55x trailing P/E unless profit roughly doubles; FY2025 profit missed expectations by about 30%.

3. Chip-level commercialisation risk. Qualification at top OSATs is slow, Henkel, Shin-Etsu and Namics are entrenched, and R&D intensity (4.4–4.7%) is thin for the roadmap breadth.

Key catalysts and monitorables (next 12 months).

FY2026 annual results and dividend: Expected timing: April 2027; Why it matters: Tests whether NP reaches the CNY 177–230 M forecast range

Q1 2027 results: Expected timing: April 2027; Why it matters: Durability of operating leverage

Techinno 2026 earn-out (≥ CNY 14 M): Expected timing: FY2026 audit; Why it matters: Goodwill safety; deferred 20% consideration

TIM1 / underfill / DAF volume orders at domestic OSATs: Expected timing: Rolling; Why it matters: Shift from small-batch to volume

South China base construction milestones: Expected timing: 2026–2027; Why it matters: IC capacity near Pearl River Delta customers

• Guangxi Lanpo integration and first consolidated contribution — Expected timing: Q4 2026 – FY2027; Why it matters: Scope and synergy of the new subsidiary

Glass-substrate materials validation: Expected timing: 2027; Why it matters: Long-dated advanced-packaging option

Big Fund and founder share-reduction activity: Expected timing: Ongoing; Why it matters: Supply overhang

Receivables and OCF trend: Expected timing: Quarterly; Why it matters: Quality of growth

New-energy pricing (CATL tenders) and PV export policy: Expected timing: Ongoing; Why it matters: Margin pressure on the largest segment

Analyst verdict. Darbond Technology is China's most complete domestic platform for electronic packaging materials, and the evidence points to a business moving into a more profitable phase after three years in which revenue growth failed to reach the bottom line. Revenue nearly tripled between FY2021 and FY2025, but net profit rose only 42%, as falling battery-adhesive prices, share-based pay and IPO-funded capacity diluted returns to a 4–5% ROE. Two things now look different. First, the mix is changing structurally: IC packaging and smart-terminal materials, carrying gross margins about 25 points above new energy, reached roughly 41% of sales in FY2025, and the Techinno acquisition has turned thermal interface materials into a pillar business tied to AI-server demand. Second, 2026 numbers show real operating leverage for the first time since listing — nine-month net profit up 52.7% on revenue up 30.5%, with operating cash flow back in surplus. The chip-level pipeline (TIM1 validated, underfill, DAF/CDAF and lid adhesives in small-batch supply) gives credible upside to an IC business that domestic OSAT capex and supply-chain localisation should keep driving.

The risks are just as concrete. New energy is still more than half of revenue and is structurally deflationary. R&D intensity has fallen below 5%. And a trailing P/E of around 55x already discounts a substantial profit ramp that published forecasts place above what the 2026 run-rate supports. On the other side, Big Fund's stake has been cut from 18.65% to 10.65%, the founders' decision not to sell in November 2026 and continued buybacks signal internal confidence, and a net-cash balance sheet funds both organic capacity and further bolt-on deals. On balance, Darbond is a quality, policy-aligned compounder whose rerating depends on execution: the shares should outperform if IC revenue keeps compounding at 50% or more and group net margin returns to around 10% in FY2027, but they will remain volatile while profit lags the sell-side's expectations.