The controlling family's holdings exceed 90%, Jadelie IPO faces hurdles: concerns over equity concentration and supplier dependence

Quanzhou Jiade Li Electronic Materials Co., Ltd. (hereinafter referred to as “Jiade Li”) is fully striving for the capital market under the leadership of the Huang family. According to information on the Shanghai Stock Exchange official website, the company’s main board IPO process has entered the second round of review inquiry responses. As a nationally recognized “Little Giant” specialized and innovative enterprise, Jiade Li focuses on the research, development, production, and sales of BOPP electrical insulation films. Its equity structure and supply chain management have become regulatory concerns.

Financial data shows that from 2022 to the first half of 2025, Jiade Li achieved operating revenues of 550 million yuan, 528 million yuan, 734 million yuan, and 367 million yuan, respectively, with net profits of 192 million yuan, 141 million yuan, 238 million yuan, and 125 million yuan in the same periods. Among its main business revenues, BOPP electrical insulation films account for as much as 94.91%, with ultra-thin films, thin films, and medium-thick films contributing 49.67%, 25.17%, and 20.07% of sales, respectively. Notably, the average selling price of ultra-thin films has shown a downward trend, at 79,900 yuan/ton, 75,400 yuan/ton, 66,700 yuan/ton, and 69,200 yuan/ton from 2022 to the first half of 2025.

In terms of supply chain, Jiade Li relies heavily on a single supplier. During the reporting period, the company’s procurement of polypropylene resin from Bolo Co. accounted for over 90% of total raw material purchases, with specific amounts of 248 million yuan, 238 million yuan, 280 million yuan, and 114 million yuan. Bolo Co., a subsidiary of Bolo Holdings Limited in the United Arab Emirates, remains Jiade Li’s largest supplier. This highly concentrated procurement model has raised market concerns about supply chain stability.

The equity structure shows that the actual controllers of Jiade Li are cousins Huang Zezhong and Huang Yanhuang, who together control 95.89% of the company’s shares through direct holdings and concerted action agreements. The prospectus discloses that Huang Zezhong and Huang Yanhuang each hold 47.94% of shares and have signed agreements to maintain consistent actions in board and shareholder meetings. In case of disagreements, production and R&D matters are to be decided by Huang Yanhuang’s opinion, while market procurement matters are to follow Huang Zezhong’s opinion. For issues that are difficult to define, the final decision will be made by Huang Zezhong. Regulators require the company to explain whether this mechanism can effectively prevent decision-making deadlocks.

In terms of corporate governance, Jiade Li exhibits obvious family characteristics. Chairman Huang Huanming is the father of Huang Yanhuang and the brother-in-law of Huang Zezhong; CFO Huang Kunfeng is a cousin of Huang Zezhong; Huang Zezhong’s mother, Chen Meiying, served as a director from November 2022 to March 2024. This governance structure has raised market concerns about internal checks and balances. Experts point out that family businesses need to reduce decision-making risks by introducing independent directors and optimizing talent structures.

For this IPO, Jiade Li plans to raise 725 million yuan, mainly to fund the first phase of the Xiamen new materials production base and to supplement working capital. Although the company has explained its shareholding concentration issues, regulators still require further clarification on the stability of control and potential governance risks. Market observers believe that balancing family control with modern corporate governance will be a key test in Jiade Li’s listing process.