Breaking Down Riyue Heavy Industry Co., Ltd. Financial Health: Key Insights for Investors

Founded in Ningbo in 2007, Riyue Heavy Industry Co., Ltd. (603218.SS) has grown from a specialist in large-scale castings to a market leader noted for milestones like the world's largest on‑shore wind turbine gearbox casting at 11 MW (2016), the mass‑production of a hundred‑metric‑ton ductile iron spent fuel transport container (2021), and its 2018 Shanghai IPO that raised RMB 980 million; as of December 31, 2024 the company reported 1.02 billion shares outstanding with insiders holding 50.90% and a public float of 500.37 million shares, while strategic financing-such as the RMB 1.2 billion convertible bond issue in 2023-funded expansion into nuclear equipment via Riyue Nuclear Equipment; operationally Riyue runs multiple manufacturing subsidiaries and R&D teams to serve wind power, marine, mining and heavy manufacturing clients, driving a reported 47.70% year‑over‑year operating revenue increase as of September 2025, a market cap near CNY 14.61 billion, a dividend of RMB 0.35 per share and a net profit margin around 13.3%, with projected net profits of RMB 680m, 840m and 973m for 2025-2027-read on to explore Riyue's ownership, mission, manufacturing model and revenue streams in detail

Riyue Heavy Industry Co., Ltd. (603218.SS): Intro

• Founded: 2007; Headquarters: Ningbo, Zhejiang, China.
• Listed: Shanghai Stock Exchange, stock code 603218, IPO in 2018 raising RMB 980 million.
• Convertible bonds: Issued in 2023, raising RMB 1.2 billion to fund Riyue Nuclear Equipment subsidiary.
• National recognition: Approved as a National Enterprise Technology Center (2019) and designated a Green Enterprise by MIIT (2019).

• Share structure: Publicly listed (603218.SS) with a mix of founder holdings, institutional investors and public float following the 2018 IPO.
• Capital allocation: IPO proceeds and 2023 convertible bonds targeted to expand production capacity, R&D and upstream materials handling for heavy castings and nuclear equipment.
• Subsidiaries: Riyue Nuclear Equipment (established 2023 using bond proceeds) to commercialize nuclear transport and containment products.

• Mission: Become a leading supplier of heavy castings and engineered equipment for renewable energy, nuclear and heavy industry through scale, technical innovation and green manufacturing.
• Core capabilities: large-scale ductile iron and steel casting, heavy machining, heat treatment, quality assurance for nuclear-grade components, and customized design for wind turbine gearboxes.
• Competitive edge: Proven delivery of record-size castings (11 MW gearbox casting), national technology center status, and integration into nuclear equipment market.

• Order intake: Contracts with wind turbine OEMs, nuclear plant operators, petrochemical and heavy industry clients for large castings and assemblies.
• Production: Foundry operations (melting, molding, pouring), large-scale machining, assembly, testing and certification (including nuclear transport standards).
• Quality & compliance: National Enterprise Technology Center recognition supports R&D, process controls and MIIT-backed green manufacturing practices.
• Distribution: Direct long-term supply agreements with OEMs and project-based EPC contracts; vertical integration via subsidiaries for nuclear segments.

• Product sales: Large castings and finished components (wind gearbox housings, shafts, nuclear transport containers) sold under long-term supply agreements and one-off project contracts.
• Engineering & value-added services: Design, heat treatment, finishing, testing and certification services charged at premium margins for critical applications.
• Project contracting: EPC-style deliveries for specialized nuclear and heavy-industry projects with milestone payments.
• Capital projects & financing: IPO and bond financing used to expand capacity and address larger, higher-margin product opportunities (e.g., nuclear equipment).

• Order backlog composition: Share of renewable vs. nuclear vs. industrial contracts - determines revenue mix and margin profile.
• Capacity utilization: Large-casting capacity and newly funded nuclear manufacturing lines dictate potential topline growth after RMB 980m IPO and RMB 1.2bn bond investment.
• R&D and certification wins: Additional national-level approvals or export certifications can unlock higher-margin international opportunities.

Riyue Heavy Industry Co., Ltd. (603218.SS): History

• Founded as a state-affiliated enterprise and restructured into a joint-stock company prior to A-share listing.
• Core capabilities: large-scale steel casting, heavy machinery assembly, aftermarket parts and engineering services.
• Market focus: domestic infrastructure, mining equipment OEMs and selected international projects.

• Ownership stability: structure has been relatively stable with only minor year-to-year shifts in share distribution.
• Significance: >50% insider stake indicates concentrated control and alignment of management with shareholder outcomes.

• Primary revenue: sale of heavy equipment and large cast components to mining, construction and power clients.
• Secondary revenue: aftermarket spare parts, refurbishment services and engineering/installation contracts.
• Margin drivers: production scale, metallurgy quality, long-term OEM contracts and export pricing.
• Capital allocation: reinvestment into foundry upgrades and capacity expansion to capture higher-margin engineered components.

Riyue Heavy Industry Co., Ltd. (603218.SS): Ownership Structure

• Mission and Values: technological innovation, environmental sustainability, product quality and reliability, customer-centric long-term partnerships, market expansion, and strong corporate governance.
• Primary markets: wind turbine components, shipbuilding parts, heavy machinery castings, and bespoke large-scale metal components.
• Public listing: Shanghai Stock Exchange (Ticker: 603218.SS), IPO completed in 2018 to support capacity expansion and R&D.

• How it makes money:
  • Sale of large castings and machined components to OEMs in wind, marine and construction equipment sectors.
  • Engineering, design and aftermarket services (precision machining, heat treatment, testing).
  • Higher-margin customized and value-added components driven by in-house R&D and tooling capabilities.
• Business model drivers:
  • Capacity utilization of foundry and machining centers.
  • Technology licensing and premium pricing for certified quality and durability.
  • Customer retention via long-term supply agreements with renewable-energy and shipbuilding clients.

Riyue Heavy Industry Co., Ltd. (603218.SS): Mission and Values

• Core activities: design, pattern making, casting, heat treatment, precision machining, assembly and testing of heavy equipment components.
• Manufacturing footprint: multiple production bases including a wholly owned precision machining subsidiary-Precision Manufacturing-created to extend in-house finishing and value-added capabilities.
• Technology adoption: automated molding lines, 3D pattern design and simulation, CNC machining centers, robotic handling and non-destructive testing equipment to raise yield and reduce lead times.
• Quality systems: ISO-certified processes, process control charts, metallurgical labs and full traceability from melt to final inspection.
• R&D focus: alloy development, weight optimization, vibration and fatigue testing targeted at wind-power nacelle parts, diesel engine blocks and high-wear plastic processing components.

• Wind power equipment castings and machined components (hubs, main shafts, gearbox housings).
• Plastic machinery castings (frames, gearbox housings for extruders and injection molding machines).
• Diesel engine blocks and large engine components.
• Precision machining centers and finished assemblies for heavy equipment OEMs.

• Product sales: direct sales of castings, machined components and finished assemblies to OEMs in wind, plastics, marine and power generation sectors.
• Value-added machining & assembly: higher-margin finishing, testing and assembly services performed in-house (via Precision Manufacturing).
• Custom engineering and prototypes: paid R&D/engineering contracts for specialty castings and materials solutions.
• Aftermarket and repair: replacement components and refurbishment services for installed equipment.

• Integrated cast-to-finish capability reduces lead times and improves margin capture.
• Diversified end markets (wind, plastics, diesel, marine) mitigate single-industry cyclicality.
• Targeted R&D and steady CAPEX maintain competitiveness in large-size, high-precision castings.

• Strict quality control from melt chemistry to final inspection; metallurgy lab and NDT procedures embedded in production flow.
• Investment in energy efficiency and emissions control at foundries to meet environmental compliance and customer sustainability requirements.
• Corporate governance aligned to A-share disclosure and reporting standards with publicly filed annual and interim reports.

Riyue Heavy Industry Co., Ltd. (603218.SS): How It Works

• Core revenue streams: sale of heavy equipment castings, finished machined components, aftermarket spare parts, engineering and installation services, and long-term supply contracts.
• Key end markets: renewable energy (wind turbine hubs and yaw components), mining (crusher and grinding mill castings), heavy manufacturing and petrochemical equipment.
• Distribution channels: direct OEM contracts, long-term framework agreements, export sales, and parts/service agreements.

• Procurement: bulk ferrous and non-ferrous alloys sourced domestically and internationally.
• Production: pattern making, molding, melting, casting, heat treatment, CNC machining, nondestructive testing and painting/coating.
• Quality & compliance: ISO/industry certifications, dimensional and metallurgical testing, client-specific approvals.
• After-sales: warranty support, spare-parts supply, refurbishing and refurbishment contracts.

• High-value, project-based orders produce large upfront revenue recognition tied to delivery milestones.
• Aftermarket spare parts and service contracts provide recurring revenue and higher margin streams.
• Scale advantages in procurement and in-house foundry drive per-unit cost reductions and support the ~13.3% net margin.
• Strong revenue growth (47.70% YoY) and a CNY 14.61 billion market cap provide financial flexibility to invest in capacity and R&D while maintaining shareholder returns (RMB 0.35/share).

Riyue Heavy Industry Co., Ltd. (603218.SS): How It Makes Money

• Core products: ductile iron castings, large castings for wind turbine hubs and towers, forged components for heavy machinery.
• Key end markets: wind power, power equipment (including nuclear), heavy machinery, and infrastructure.
• Revenue streams: direct product sales, engineering & testing services, and strategic supply contracts with OEMs and EPC contractors.

• Market position: leading player in China's heavy equipment casting sector with a strong presence in wind-power component supply chains.
• Competition: faces pressure from domestic foundries and international suppliers for high-spec castings and forged parts.
• Growth drivers: sustained demand in wind power, capacity expansion, and investments in advanced casting/forging technology and quality certification for nuclear-grade components.