Shenzhou Semiconductor: From Technical Support to Self-Developed Products

Jiangsu Shenzhou Semiconductor Technology Co., Ltd. has completed a shift in business focus over the past two years. According to the prospectus, the proportion of the company's self-developed product revenue to its main business revenue rapidly increased from 8.21% in 2023 to 55.11% in 2025, meaning the company is moving from an early stage of relying on technical support services to truly establishing its market position through self-developed core component products. This transformation curve has been remarkably fast.

Shenzhou Semiconductor was founded in April 2016, registered in Yangzhou, with legal representative Zhu Peiwen actually controlling 64.74% of the company's voting rights. The company's main business is plasma power supply systems, with core products including plasma RF power supply systems and remote plasma source systems, which are key components of semiconductor equipment. Its business model is a dual-driven combination of self-developed product sales and technical support services.

Technical support services still accounted for 42.92% of main business revenue in 2025, mainly providing ongoing technical support and maintenance to long-standing customers that have already completed equipment validation. This business model is relatively stable and can provide the company with continuous operating cash flow, complementing the rapid scaling of self-developed products.

What supports this transformation curve is the quality of the customer list. Among Shenzhou Semiconductor's top five customers in 2025, AMEC accounted for 48.29%, alongside other leading enterprises in the semiconductor equipment and manufacturing industry such as Piotech and SK Hynix. These customers are themselves among the companies with the highest technical barriers in China's domestic semiconductor equipment sector. Being able to enter the core component supply chains of these leading enterprises represents a screening and endorsement of Shenzhou Semiconductor's technical capabilities.

The prospectus also discloses that AMEC directly holds 1.3636% of Shenzhou Semiconductor's shares through a wholly-owned subsidiary and indirectly holds 1.8610%, while Piotech similarly holds 1.7861% through a subsidiary, meaning the company's two largest customers are also shareholders. This dual relationship of customer plus shareholder typically reflects a deep technical collaboration and trust foundation between upstream and downstream players in the semiconductor equipment industry chain.

In terms of financial data, Shenzhou Semiconductor's revenue over the past three years grew from 261.0554 million yuan to 654.2400 million yuan, with a three-year compound growth rate of 58.31%, a relatively fast growth rate in the special equipment sector. Non-recurring net profit attributable to parent company grew from 56.3927 million yuan to 198.2712 million yuan over the same period, an increase of more than two and a half times.

Weighted average ROE rebounded significantly from negative 8.50% in 2023 to 31.95% in 2025 (the net profit attributable to parent company was negative that year, mainly due to a one-time share-based payment expense of 81 million yuan, reflecting the actual controller's equity incentive arrangements for the core team), demonstrating a rapid recovery in profitability. In terms of R&D investment, the company's R&D expenses grew from 36.6682 million yuan in 2023 to 109.2175 million yuan in 2025, totaling approximately 204 million yuan over three years, accounting for 14.97% of cumulative revenue.

As of the end of 2025, the company had 107 authorized patents, including 62 invention patents, as well as 53 software copyrights, 7 work copyrights, and 35 trademarks. Its intellectual property portfolio covers multiple levels from core hardware to supporting software.

In terms of customer concentration, Shenzhou Semiconductor's top five customers' share of revenue rose from 39.31% in 2023 to 72.89% in 2025. This upward trend is basically consistent with the business development stage of self-developed product scaling and increasing proportion of orders from major customers. The semiconductor equipment core component industry itself has a limited number of downstream customers, and head customer concentration is a common characteristic of this niche sector. The company's ability to continuously obtain a larger proportion of orders from head customers reflects the deepening of cooperation between both parties.

The company's main business gross margin was 62.56%, 66.94%, and 66.65% from 2023 to 2025, respectively, remaining at a consistently high level. The prospectus explains that this is because the company focuses on advanced process areas with high technological added value and high R&D difficulty, and its product positioning has a certain scarcity in the niche market. Plasma power supply systems are themselves a segment with high technical barriers in the semiconductor equipment industry chain. Customers have strict requirements for product reliability and consistency, and validation cycles are long. Once a supplier passes validation and enters the supply chain system, the cost of switching suppliers is high, which is also a common reason why high gross margins can be maintained in this industry.

R&D team building is another direction in which the company continues to increase investment. According to the prospectus, the proportion of the company's R&D personnel to total employees remains above 24%, with R&D directions covering multiple technical modules including core algorithms for RF power supply systems and power device design, providing the personnel foundation for the rapid increase in the proportion of self-developed products.

For this IPO, Shenzhou Semiconductor plans to raise 2.522 billion yuan, of which 851 million yuan will be invested in the R&D and industrialization project for power supply components in the advanced process node integrated circuit field, another 555 million yuan will be invested in the Shanghai industrialization base construction project, 556 million yuan will be invested in the technology R&D innovation center construction project, and the remaining portion will be used to supplement working capital. The focus of the fundraising is clearly directed toward expanding R&D capacity for advanced process components and building an industrialization base, representing a dual extension of production capacity and R&D depth based on existing technological advantages.

From the perspective of product application scenarios, plasma power supply systems are mainly used in front-end process steps such as etching and thin film deposition in semiconductor manufacturing. Such equipment has extremely high requirements for the stability and precision of power supply systems, and any fluctuation can directly affect wafer yield. Shenzhou Semiconductor's ability to enter the supply chains of domestic etching equipment and thin film equipment leaders such as AMEC and Piotech indicates that its product performance has passed long-term validation by these downstream equipment manufacturers in actual mass production processes.

There is another piece of information in the prospectus worth noting: the company was listed and displayed on the Jiangsu Equity Exchange Center in December 2024 and terminated its listing in April 2026, turning to this STAR Market application. This transfer path is a common growth path for many manufacturing enterprises in niche sectors. In addition, the company's original shareholders' repurchase rights clauses were terminated through two termination agreements signed in November 2025 and April 2026, involving Zhu Peiwen himself and several other shareholders. The termination of such clauses typically means that early investors have maintained confidence in the company's IPO prospects.

Shenzhou Semiconductor's inquiry process is currently at the inquiry stage. How the company further explains the basis for the sustainability of its gross margin in its inquiry response, as well as the long-term cooperation mechanism with partners such as AMEC and Piotech that are simultaneously customers and shareholders, are parts worth watching in the upcoming inquiry response.