Adjustment of Shanghai Hejing's fixed-increase growth plan: axing supplementary projects, adding 700 million to 12-inch silicon wafers, and relying on debt for 70% of the expansion funds

value scale

2026.11.11 23:15

· From Beijing

Full text 3019 words

Under the wave of domestic substitution of semiconductor silicon wafers, 12-inch large silicon wafers are an unavoidable competitive high ground. Shanghai Hejing (688584.SH), as a core player in the domestic and foreign epitaxial wafer tracks, has made another refinancing plan this year to bet on the industrialization of 12-inch semiconductor silicon wafers.

On November 11, the company released the latest "Prospectus for the Issuance of A Shares to Specific Targets in 2026 (Revised Draft)". After revision, the company cut off its supplementary working capital arrangements and planned to raise 700 million yuan, all of which will be invested in production expansion projects. However, this fixed increase can only cover more than 20% of the total project investment of 2.575 billion yuan, and more than 70% of the funding gap needs to be filled by syndicated loans.

It is worth mentioning that Shanghai Hejing, which listed on the A-share market on February 8, 2024, has been raising funds frequently: it had just raised 1.5 billion yuan for research and development, industrialization and supplementary investment during the IPO, and the projects have not yet been completed; in August 2026, it completed the issuance of the first phase of science and technology innovation bonds worth 200 million yuan, and now it is launching a fixed increase plan of 700 million yuan.

The supplementary flow project will be cut off, and the 700 million fixed increase will all be invested in the industrialization of 12-inch silicon wafers.

After a round of major changes in the plan, the outline of Shanghai Hejing's private placement financing in 2026 has become clear.

Before this revision, the company initially planned to raise no more than 900 million yuan, of which 700 million yuan would be invested in the 12-inch semiconductor large silicon wafer industrialization project, and the remaining 200 million yuan would be used to supplement working capital. In the response to the inquiry letter and the revised private placement plan disclosed on November 11, 2026, the company directly cut off the supplementary project and reduced the upper limit of raised funds to 700 million yuan. It plans to use all of it for the purchase of equipment and software under the 12-inch semiconductor large silicon wafer industrialization project, and will no longer arrange for funds other than capital expenditures.

According to the plan, the total investment in the expansion project is 2.575 billion yuan. After the project is completed, it will achieve an annual production capacity of 900,000 12-inch substrate wafers and 720,000 12-inch epitaxial wafers. Among them, the 12-inch polished substrate wafers will be used internally for epitaxial wafer production and will not be sold to the outside world. Only the 12-inch epitaxial wafers will be sold to the outside world, targeting high-end application markets such as CIS image sensors and logic chips.

From the perspective of investment structure, equipment and software purchase fees constitute the bulk of the investment, amounting to approximately 2.268 billion yuan, accounting for 88.11% of the total project investment. It is a typical asset-heavy semiconductor manufacturing project.

In fact, looking back at the investment layout during the IPO stage, Shanghai Hejing had already focused on the R&D and industrialization of large-size silicon wafers and epitaxial technology when it went public. The investment projects at that time included two core projects: "low-resistance single crystal growth and high-quality epitaxial R&D" and "high-quality epitaxial wafer R&D and industrialization projects", focusing on optimizing 8-inch and 12-inch epitaxial-related crystal growth, epitaxial growth processes and R&D capabilities. It is worth mentioning that the "High-Quality Epitaxial Wafer R&D and Industrialization Project" has been completed in October 2026, and the start-up time of the "Low Resistance Monocrystal Growth and High-Quality Epitaxy R&D Project" has been postponed to June 30, 2027.

The previous IPO fundraising has not yet been fully completed, and a new round of large capital expenditures has followed. The Shanghai Stock Exchange requires the company to explain the differences and connections between this private placement and the IPO fundraising project. The company said in its latest response to inquiries that from a business logic perspective, this private placement expansion project is connected with the IPO fundraising. The IPO fundraising is more focused on process research and development, production line verification, and consolidating 12-inch related underlying technologies. This private placement is to promote large-scale production capacity construction after the completion of the early technology accumulation, realize the implementation of small batch R&D and mass production, and further complete the complete 12-inch substrate-epitaxy chain.

The company also made it clear that this expansion comes from the realistic demand for domestic substitution in the market. Data from the 2025 TechInsights McClean Report shows that the global CMOS image sensor (CIS) market size has reached US$20.177 billion in 2024. It is expected to maintain an average annual compound growth rate of 14.47% from 2026 to 2029, and the market size is expected to exceed US$45 billion by 2029. Among them, China's CIS market size will reach 52.68 billion yuan in 2024, a year-on-year increase of 20.94% from 2023 (data from China Business Industry Research Institute).

The global CIS industry has formed a pattern of "Sony dominates high-end, Samsung takes into account scale, and Chinese companies rise", presenting a highly concentrated oligopoly situation for a long time. Domestic chip manufacturing continues to unleash demand for 12-inch silicon substrates and high-end epitaxial wafers. There is still a supply gap in the local supply chain, and industry companies generally choose to increase production and expand production to seize market share.

Against this background, Shanghai Hejing's existing 12-inch power device epitaxial wafer production capacity cannot be directly switched to the CIS analog chip field, and the company has long-term and in-depth cooperation with major customers, and has successfully entered the AI ​​data center field. In the third quarter of 2026, the capacity utilization rate of 12-inch power device epitaxial wafers has reached 89.44%, and continues to be tense. As of the end of 2025, the company's annual production capacity of 12-inch epitaxial wafers will be 563,900 pieces, including 383,900 pieces in the power device field and 180,000 pieces in the CIS analog chip field.

However, it should be noted that 12-inch large silicon wafers are an extremely capital-intensive track. It takes a long time for new production lines to ramp up and improve yields. With the addition of nearly one million-level production capacity, whether sufficient downstream orders can be found in the future is still the focus of the market. Once downstream demand falls short of expectations, there will be risks of idle production capacity and depreciation eating up profits. The Shanghai Stock Exchange's inquiry also focused on the rationality of the project's benefit calculation. According to calculations based on the application materials, the project's financial internal rate of return after income tax was only 5.91%.

Fund-raising only covers 27% of investment, and the funding gap for production expansion mainly depends on loans.

In the deep capital-intensive track, what is more scarce than production capacity is Shanghai Hejing's disposable funds.

The scale of the fixed increase of 700 million yuan is not small, but it only accounts for about 27% of the total investment of 2.575 billion yuan. Most of the funding gaps must be financed by borrowing.

According to the financing plan disclosed by the company, excluding the 700 million yuan of fixed-increase funds, the remaining funding sources for the project are divided into two parts: one part is the project's own capital, and the other part is a syndicated loan of 1.8 billion yuan provided by a syndicate led by the China Development Bank Henan Branch. Debt financing accounts for nearly 70% of the entire project investment, and the characteristics of debt expansion are very distinct.

According to the project calculation assumptions, the borrowing interest rate is 3.1%, the construction period is 3 years, and the interest during the construction period is 80.91 million yuan. This means that during the subsequent project construction and production phases, the company will continue to bear considerable interest expenses, and financial expenses will directly impact the income statement.

Looking at the company's third quarterly report for 2026, we can see that the operating level is already under pressure. In the first three quarters of 2026, Shanghai Hejing achieved operating income of 950 million yuan, a year-on-year decrease of 5.49%; net profit attributable to the parent company was 48.8959 million yuan, a sharp decrease of 53.34% year-on-year; net profit after deducting non-attributable shares was only 29.895 million yuan, a year-on-year decrease of 70.34%, and the contraction of the profit side was much greater than the decline in revenue.

Gross profit margin also showed a downward trend. Affected by multiple factors such as industry cycles, market competition, raw material fluctuations, and product structure changes, the company's main business gross profit margins were 37.60%, 29.15%, 29.23%, and 26.58% respectively in 2023-2025 and the first half of 2026.

The good side is that the company's operating cash flow remains resilient. In the first three quarters of 2026, the net cash flow generated from operating activities was 328 million yuan, a slight increase of 9.80% year-on-year. The main business hematopoietic capacity exists, which can bring a certain buffer space for project construction. As of the end of the third quarter, the company's monetary capital was 729 million yuan, which can cover daily operating turnover. However, in the face of large-scale projects worth 2.5 billion, the amount of its own funds is obviously insufficient to support it.

As of the end of the third quarter of 2026, the company had short-term borrowings of 70.0208 million yuan, non-current liabilities due within one year of 9.4942 million yuan, long-term borrowings of 724 million yuan, and bonds payable of 199.6278 million yuan. During the production expansion cycle, the company's asset-liability ratio will rise with the implementation of syndicated loans, and debt repayment pressure will also rise. The company also warned of risks in its response to inquiries. There are uncertainties in the approval and disbursement progress of syndicated loans; if the subsequent semiconductor industry downturns, product prices fall after the project is put into production, and the capacity utilization rate is lower than expected, there will be a situation where the project income is less than expected, or even unable to cover the principal and interest.

For Shanghai Hejing, what lies ahead is the dilemma of a typical cyclical industry: if it does not expand production, it will fall behind its peers in the track of domestic substitution; if it borrows large amounts of debt to expand production, it will have to withstand the double test of financial costs and cyclical fluctuations.

After all, it will take a long time for a production expansion project to go from construction and ramping up production lines to releasing production capacity and realizing profits. And private placement financing can only solve a small part of the funds. The real test of the company will be the industry prosperity in the next few years, the implementation of customer expansion, and the financial resilience to withstand large debts. (This article was first published on Titanium Media APP, text | Value Scale, author | Tao Zi)

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