Breaking Down PhiChem Corporation Financial Health: Key Insights for Investors

From its 2002 founding in Shanghai to its 2014 Shenzhen listing under 300398.SZ, PhiChem Corporation has grown into a global materials player-relocating headquarters and R&D to Baoshan in 2016, opening a manufacturing base in Anqing in 2009, and expanding through 2017 acquisitions of an EMC and solder‑ball business plus a merger with HCCH to enter liquid‑crystal materials; today it boasts over 500 scientists and technicians, ISO9001:2008 and ISO14001 certifications, and status as the largest UV curable materials supplier in China and a top‑three global player for optical fiber coatings, while its ownership has shifted (controlling holdings fell from 23.92% to 22.59% following convertible bond conversions and buybacks) and the company reached a market capitalization of 12.31 billion CNY after a 57.37% year‑over‑year rise, with fiscal momentum shown by H1 2025 operating revenue of 1.462 billion CNY and net profit attributable to shareholders of 217 million CNY (up 80.45% YoY), supported by diversified product lines across semiconductor, display, UV curing and organic synthesis materials and active trading volume near 37.6 million shares daily.

PhiChem Corporation (300398.SZ): Intro

• 2002 - Company founded in Shanghai; initial products: UV curable coatings for optical fiber/cable.
• 2009 - Opened manufacturing facility in Anqing, Anhui; expanded into electronic materials production.
• 2014 - Went public on the Shenzhen Stock Exchange (300398.SZ).
• 2016 - Relocated corporate headquarters and R&D laboratories to a modern facility in Baoshan, Shanghai.
• 2017 - Acquired an epoxy molding compound (EMC) production business and a solder-ball manufacturing business to broaden electronic packaging materials capability.
• 2017 - Merged with Nanjing-based HCCH to enter liquid crystal materials production for LCD panels.

• Listed entity: PhiChem Corporation, Shenzhen Stock Exchange, ticker 300398.SZ.
• Major shareholders typically include founding management, domestic institutional investors, and strategic partners from the electronics and display supply chain (shareholding percentages have varied across filings).
• Corporate organization: R&D centers in Shanghai, manufacturing hub in Anqing, additional production lines acquired/merged in 2017 for EMC, solder-ball, and LCD liquid crystal materials.

• Mission: Deliver high-performance, cost-competitive specialty materials for optical, electronic packaging, and display industries to support domestic and global high-tech manufacturers.
• Strategic pillars: product diversification (coatings, electronic materials, EMCs, solder balls, liquid crystal materials), vertical integration of materials supply, and sustained R&D investment to target next-generation packaging and display needs.

• R&D-driven product development: polymer chemistry, photo-curable systems, epoxy molding compounds, and LC formulations for displays.
• Manufacturing: centralized large-scale facility in Anqing for core materials, supplemented by acquired EMC and solder-ball lines; quality controls tailored to electronics and display standards.
• Customer integration: supply agreements with component manufacturers, blended custom formulations, and technical support for process integration (curing profiles, thermal reliability, adhesion).

• Product sales - core revenue from UV coatings, electronic materials, epoxy molding compounds (EMC), solder balls, and liquid crystal precursor materials.
• OEM/ODM supply contracts - multi-year supply agreements with electronics and display manufacturers for stable volume commitments.
• Value-added services - technical support, bespoke formulations, and process optimization fees for customers integrating materials into manufacturing lines.

• Product mix: electronics materials and packaging compounds now form a substantial portion of sales since the 2017 acquisitions and HCCH merger.
• R&D intensity: elevated relative to legacy chemical manufacturers (R&D as % of revenue typically in high single digits), reflecting focus on formulation and reliability testing.
• Market role: positioned as a domestic supplier to mitigate import dependence for specialty materials in China's electronics and display supply chains.

• Primary customers: component manufacturers for optical fiber, IC packaging houses, PCB/substrate fabricators, and LCD/OLED panel makers.
• Distribution: direct sales to industrial customers, strategic OEM partnerships, and selective distributor channels for ancillary markets.
• Geography: manufacturing primarily in China (Anqing, Shanghai); sales concentrated in Greater China with growing outreach to Southeast Asia and other Asian electronics manufacturing hubs.

• 2017 acquisitions and merger: materially broadened product portfolio into EMC, solder-ball, and LCD liquid crystal materials - enabling cross-selling to existing customers and deeper integration across packaging and display value chains.
• Headquarters and R&D consolidation (2016): increased coordination between product development and scale-up, accelerating time-to-market for new formulations.

PhiChem Corporation (300398.SZ): History

• Founded as a specialty chemical developer with growing vertical integration into intermediate and active pharmaceutical ingredient (API) supply chains.
• Expanded capacity via capital increases and technology licensing; pursued buybacks to support share price and capital structure.
• Listed on the Shenzhen Stock Exchange under ticker 300398.SZ, with active secondary-market trading.

• Major shareholder: Phichem Holdings (controlling shareholder), together with persons acting in concert including ZHANG JUSTIN JICHENG, ZHANG ALAN JIAN, Zhang Yanxia, and Xia Shifeng.
• Combined shareholding of the controlling group decreased from 23.92% to 22.59% as of May 7, 2025, primarily due to convertible bond conversions that increased total share capital and completed buybacks that passively diluted holdings by ~1.19%.
• The company maintains a diverse institutional and retail shareholder base traded on Shenzhen; major named individual holders include ZHANG JUSTIN JICHENG and ZHANG ALAN JIAN.

• Revenue drivers: sale of specialty chemicals, intermediates and APIs to pharmaceutical, agrochemical and industrial customers; licensing and toll-manufacturing agreements.
• Profitability levers: scale in chemical synthesis, proprietary processes that raise margins, vertical integration reducing raw-material volatility, and selective capacity utilization.
• Capital strategy: periodic equity and convertible-bond financing for capacity/R&D, supplemented by share buybacks to manage EPS and capital efficiency.

PhiChem Corporation (300398.SZ): Ownership Structure

• Mission: Provide cost-effective, high-performance materials solutions to companies in the high-tech manufacturing sector, while driving innovation and environmental responsibility.
• Core values: customer satisfaction, continuous improvement, collaboration, integrity, quality, and safety.

• Strategic focus: scale product commercialization in semiconductors, advanced coatings, and specialty chemicals through customer partnerships and process innovation.
• Operational commitments: maintain high QA/QC standards, reduce environmental footprint across production, and increase automation to enhance competitiveness.

• How it makes money: product sales of specialty materials (coatings, additives, chemical intermediates) to semiconductor, electronics, and precision manufacturing companies; value-added services include formulation, technical support, and production-scale customization.
• Revenue drivers: growth in semiconductor demand, higher-value specialty formulations, expanded export sales, and deeper integration into clients' supply chains.
• Risk & governance: concentration risk from a few large customers is offset by long-term supply agreements, quality certifications, and incremental diversification into adjacent end markets.

PhiChem Corporation (300398.SZ): Mission and Values

• Headquarters: Shanghai, China
• Corporate structure: centralized management model with integrated R&D, manufacturing, and sales functions
• Core mission: develop advanced chemical materials for semiconductors, display, UV-curable systems and specialty organic synthesis while maintaining high quality and environmental standards

• R&D and talent: over 500 skilled scientists, engineers and technicians in state-of-the-art labs based in Shanghai and affiliated sites
• Product portfolio:
  • UV-curable materials (resins, photoinitiators)
  • Semiconductor materials (photoresists, specialty intermediates)
  • Display materials (alignment layers, organic intermediates)
  • Synthetic organic materials (custom intermediates and fine chemicals)
• Manufacturing locations: facilities strategically located in Anqing, Jiangsu Province and other regions to meet global demand and logistics needs
• Quality & environment: adheres to ISO9001:2008 and ISO9001:14001 certification standards
• Global commercial presence: sales offices in China, Taiwan, Japan, the United States, South Korea and India

• Product sales: primary revenue from sale of specialty chemical products (UV-curables, semiconductor and display materials, synthetic organics) to electronics, semiconductor fabs, display manufacturers and coatings companies
• Customized synthesis and contract development: revenue from development and supply of tailored organic intermediates and pilot-to-scale manufacturing services
• R&D-driven premium products: higher-margin specialty products driven by proprietary formulations and application know-how
• Global sales & distribution: regional sales offices support direct B2B contracts, long-term supply agreements and after-sales technical support

PhiChem Corporation (300398.SZ): How It Works

• Core product lines: UV-curable coatings for optical fiber and cable, semiconductor process materials (photoresists, CMP chemistries, deposition precursors), and display materials (OLED emitters, liquid crystal materials).
• Primary end markets: optical fiber & cable manufacturers, integrated circuit fabs, display panel producers, and downstream electronics OEMs.
• Go-to-market: direct sales to large industrial customers, long-term supply agreements, and technical support/qualification services that increase switching costs and pricing power.

• Value capture mechanisms:
  • Premium pricing on high-purity, high-performance materials.
  • Revenue from R&D-driven new product adoption and multi-year supply contracts.
  • Aftermarket and technical services (process optimization, qualification fees).

• Revenue mix estimate (H1 2025) - illustrates concentration by product segment:
  • Semiconductor materials: ~40% (~584.8M CNY)
  • Display materials (OLED, LC): ~30% (~438.6M CNY)
  • Optical fiber & cable coatings: ~20% (~292.4M CNY)
  • Other specialty materials & services: ~10% (~146.2M CNY)

• Key financial drivers behind recent performance:
  • Shift toward higher-value semiconductor and display chemistries improved average selling prices and mix.
  • Cost management and scale in production raised margins, supporting an outsized net profit increase (+80.45%) despite modest revenue growth (+3.80%).
  • Ongoing R&D investment accelerates qualification cycles for large fabs and panel makers, driving multi-year revenue visibility.

PhiChem Corporation (300398.SZ): How It Makes Money

• Market position: largest supplier of UV curable materials to China's optical fiber and cable industry and one of the top three global suppliers for that industry.
• Core business segments driving revenue:
  • Semiconductor materials - advanced packaging & chip manufacturing consumables
  • Display materials - new display chemistries for OLED/mini-LED/advanced panels
  • UV curing materials - optical fiber & cable coatings and related supplies
  • Organic synthesis materials - custom intermediates and specialty molecules
• Investor confidence: market capitalization rose by 57.37% over the past year, reflecting strong investor sentiment and growth expectations.
• Growth levers: ongoing R&D investments, industry-academia-research partnerships, strategic acquisitions, and geographic/market expansion.

• R&D & innovation strategy:
  • Build national-level R&D platforms and deepen industry-university-research collaboration.
  • Attract international talent to accelerate independent innovation and commercialize advanced materials.
• Future outlook: positive - driven by secular demand in semiconductors and displays, continued dominance in UV curing for optical fiber, and deliberate investments in R&D and M&A to capture higher-margin opportunities.