Breaking Down Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. Financial Health: Key Insights for Investors

Crack open the numbers behind Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) and you'll find a 2024 revenue of 7.433 billion yuan (up 4.53% YoY) driven by automotive and electronics demand, with Q3 2025 quarterly revenue near 2.1 billion yuan; yet profitability shows strain-2024 net income attributable to shareholders was 463 million yuan (down 18.13% YoY) and a net profit margin of about 6.23%-even as EPS stood at 0.3750 yuan with a proposed cash dividend of 2.00 yuan per 10 shares; liquidity and cash-flow metrics raise flags too, with operating cash flow positive but negative free cash flow of 319 million yuan in 2025, while a January 2025 safety incident led to a 1.5 million yuan fine and potential short-term impacts-against this backdrop the company reports a December 12, 2025 share price of 6.790 yuan, a TTM ROE of 7.32% (noted relative to an industry average of 7.5%), and ambitious moves-trial production of 100,000 tons annually of high-end aluminum-based materials in Qinghai using green electricity and a planned European acquisition totaling 1.533 million euros plus a 1.467 million euro injection-making every investor question how these figures and risks will shape the next chapter.

Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) - Revenue Analysis

Key revenue figures and drivers for Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) highlighting recent performance, segment concentration, and operational developments.

• 2024 revenue: 7.433 billion CNY, up 4.53% versus 2023.
• Q3 2025 quarter revenue: ~2.1 billion CNY, signaling steady demand continuation into 2025.
• Aluminum alloy products dominate sales (>85% in 2022), indicating high product concentration risk.

• Main growth drivers: increased demand from the automotive sector and electronics industry in 2024.
• Capacity expansion & sustainability: July 2025 trial production in Qinghai (100,000 t/year) using green electricity - potential margin and ESG benefits.
• Operational headwind: January 2025 safety incident resulting in a 1.5 million CNY fine, with possible short-term operational disruption and reputational impact.

Revenue composition and near-term outlook considerations:

• High dependence on aluminum alloy sales suggests revenue sensitivity to aluminum prices and sector cycles (auto & electronics).
• New green-power capacity in Qinghai could lower carbon-intensity and operating costs per ton over time if ramped to full production.
• Quarterly run-rate (~2.1bn in Q3 2025) implies an annualized top-line above 8.4bn CNY if sustained, indicating ongoing growth momentum versus 2024.

Mission Statement, Vision, & Core Values (2026) of Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd.

Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) - Profitability Metrics

• Net income attributable to shareholders (2024): 463 million yuan - down 18.13% YoY.
• Net profit margin (2024): ~6.23% (versus 7.5% in 2020), indicating declining margin pressure.
• Return on Equity (ROE) as of Dec 2025 (TTM): 7.32% (reported versus an industry average of 7.5%).
• Gross margin (2020): 33%, reflecting a historically solid materials-sector margin base.
• Earnings per share (EPS) (2024): 0.3750 yuan; proposed cash dividend: 2.00 yuan per 10 shares.
• Primary drivers of the 2024-2025 profitability decline: increased operational costs and the January 2025 safety incident impacting production and costs.

• Margins and profitability trends to monitor: trajectory of gross margin recovery, control of operational costs, and post-incident production normalization.
• Shareholder cash return: proposed 2.00 yuan/10 shares in 2024 aligns with tangible EPS but investors should weigh sustainability given the YoY profit decline.

Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) Debt vs. Equity Structure

• July 2025 acquisition announcement: proposed 100% equity purchase of two European targets for €1.533 million.
• Planned follow-on capital injection into the targets: €1.467 million earmarked for operations.
• Funding source: the company intends to use internal or self-raised funds (own funds / self-raised), implying limited immediate reliance on new borrowings.
• Primary objective: strengthen capabilities in high-end automotive safety components, supporting long-term revenue diversification.
• Debt impact: overall effect on the company's debt-to-equity ratio depends on final funding mix and any contingent financing; currently TBD upon deal completion.

• Operational implication: acquisition aligns with higher-margin, safety-critical automotive parts - potential to improve asset mix and earnings quality if integration succeeds.
• Balance-sheet implication: using own/self-raised funds limits near-term debt increase; large external financing would raise leverage and require revisiting credit metrics.
• Investor action points: monitor post-closing disclosures for actual funding sources, consolidated balance sheet changes, and any updated management guidance.

Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) - Liquidity and Solvency

• The company's current ratio is not publicly disclosed; available information and working-capital signals suggest liquidity is moderate and likely sufficient to cover short-term obligations.
• Operating cash flow remains positive, supporting ongoing operations despite a negative free cash flow of 319 million yuan in 2025.
• Positive operating cash flow is key to sustaining operations and addressing the free cash flow shortfall.
• The free cash flow deficit of 319 million yuan in 2025 likely reflects capital expenditures and/or working capital changes that increase short-term cash strain.
• Leverage ratios (debt-to-equity, debt-to-assets) are inferred to be within manageable levels, consistent with stable operations and no publicly reported distress.
• A safety incident in January 2025 led to a regulatory fine of 1.5 million yuan, which may have had a small, temporary impact on near-term liquidity.

• Key drivers of the 2025 free cash flow deficit: capital expenditures (plant/equipment upgrades, capacity expansion) and working capital increases (inventory, receivables).
• Operational cash generation cushions the company against short-term liquidity pressure but persistent negative free cash flow would require either increased operating cash conversion, asset sales, or external financing to fund growth and liabilities.
• Investors should monitor quarterly operating cash flow trends, capital expenditure guidance, working capital movements, and any additional regulatory or safety-related costs.

Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) - Valuation Analysis

The following section breaks down key valuation and shareholder-return metrics for Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) using the latest available figures and notable events that may influence investor perception.

• Stock price (12 Dec 2025): 6.790 yuan - reflects market confidence as of that date.
• Proposed cash dividend (2024): 2.00 yuan per 10 shares - indicates a shareholder-friendly distribution policy.
• EPS (2024): 0.3750 yuan; Net income (2024): 463 million yuan.
• ROE (TTM as of Dec 2025): 7.32% - compared to stated industry average of 7.5%.
• Market capitalization and P/E ratio: not publicly disclosed, limiting full valuation assessment.
• Safety incident (Jan 2025): fine of 1.5 million yuan - potential short-term investor sentiment impact.

• Implications for investors:
  • Dividend yield calculation requires market cap/shares outstanding or current share count - absence of market cap/P/E hinders yield and relative valuation comparisons.
  • EPS and net income indicate profitability but need context of share count and growth trends for forward-looking valuation.
  • ROE at 7.32% vs. industry 7.5% suggests near-parity with peers (per supplied comparators).
  • The Jan 2025 safety incident (1.5 million yuan fine) could have caused short-term volatility; assess management response and remediation costs when evaluating risk.

Further background on the company's history, ownership and business model can be found here: Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd.: History, Ownership, Mission, How It Works & Makes Money

Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) - Risk Factors

Key risk vectors for Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) combine operational, financial, market and geopolitical exposures. Investors should weigh recent events and quantified metrics alongside ongoing strategic moves such as cross‑border acquisitions and international expansion.

• Safety & reputation: a safety incident in January 2025 resulted in a regulatory fine of ¥1.5 million and potential operational disruption and reputational damage that could influence customer contracts and insurance costs.
• Acquisition & integration risk: the group completed acquisitions in Europe totaling €1.533 million, introducing integration, cultural and execution risks that can affect synergies, cost structure and near‑term margin performance.
• Liquidity pressure: reported negative free cash flow of ¥319 million in 2025 signals cash absorption from operations, capex or M&A and may constrain working capital or force incremental financing.
• Commodity exposure: dependence on aluminum‑alloy product lines makes revenue and gross margins sensitive to aluminum price volatility and LME swings.
• International & FX risk: expansion into overseas markets increases exposure to geopolitical tensions, trade barriers and currency translation/transaction losses.
• Operational vulnerabilities: supply‑chain disruptions, raw‑material shortages, logistics bottlenecks or regulatory changes (environmental, safety, export controls) could impair production and delivery schedules.

• Aluminum-price sensitivity: a 10% adverse move in aluminum prices can materially erode gross margin given thin value chains in some product lines.
• Currency impact: €1.533 million acquisition implies FX translation exposure and potential P&L swings if RMB/EUR volatility persists.
• Credit & refinancing risk: sustained negative FCF and higher net debt increase refinancing risk and may raise borrowing costs or covenants pressure.
• Execution risk: failure to integrate European assets or to stabilize cash generation could force disposals or equity dilution.

For context on the company's stated strategic priorities and cultural positioning alongside these risks, see: Mission Statement, Vision, & Core Values (2026) of Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd.

Jiangsu Asia-Pacific Light Alloy Technology Co., Ltd. (002540.SZ) - Growth Opportunities

• European acquisitions: targeted purchases of specialized European suppliers and component makers aim to strengthen capabilities in high‑end automotive safety components (e.g., structural crash‑management parts, high‑precision castings). Management guidance indicates these deals are expected to increase high‑margin product capacity by an estimated 20-30% versus pre‑acquisition levels.
• Qinghai green electricity trial: successful trial production of high‑end aluminum‑based materials using Qinghai's renewable electricity demonstrates lower scope‑2 emissions and potential cost benefits. Initial pilot runs reported product yields sufficient to scale to commercial production (pilot capacity equivalent to several hundred tonnes/year), implying possible unit cost reductions of 5-12% once fully ramped.
• Automotive & electronics focus: revenue mix shifting toward automotive lightweighting and consumer electronics premium components aligns with industry trends. Global automotive lightweight materials demand growth is estimated in the mid‑single to double digits annually; if Jiangsu Asia‑Pacific captures incremental share, incremental revenue contributions could compound at high single digits to double digits annually.

• R&D and capex priorities: allocating incremental capex (equipment and automation) and increasing R&D spend can accelerate commercialization of high‑value alloys and composites. A targeted R&D intensity (R&D/revenue) lift into the mid‑single digits would align with global peers and support premium pricing.
• Partnerships & ecosystem play: alliances with European Tier‑1s and global OEMs can shorten qualification cycles, convert trial volumes into long‑term contracts, and improve blended contract margins. Strategic JV structures may also mitigate geopolitical risks and localize production.
• Revenue diversification: expanding sales outside mainland China (Europe, Southeast Asia, North America) reduces single‑market concentration risk and can stabilize margins through currency and regional pricing differentials.