GaoTe Electronics Prepares for IPO Focused on Energy Storage BMS Products Amid High Accounts Receivable

Gaot Electronic is preparing for an upcoming meeting focused on energy storage BMS-related products, with a notable balance in accounts receivable.

In recent years, the rapid development of renewable energy industries such as photovoltaics and wind power has led to significant growth in the energy storage sector. This is particularly relevant in the context of increasing reliance on renewable energy generation, making energy storage systems essential for balancing electricity supply and demand. Currently, there are energy storage companies eyeing an IPO. Reports indicate that on January 13, 2026, Hangzhou Gaot Electronic Equipment Co., Ltd. (referred to as “Gaot Electronic”) will present its initial public offering on the Shenzhen Stock Exchange’s Growth Enterprise Market, with CITIC Securities serving as the sponsor.

Gaot Electronic provides advanced battery management systems (BMS) for the renewable energy sector and has maintained a leading position in BMS product shipments in the large-scale energy storage field for three consecutive years. However, its performance is subject to cyclical fluctuations in the industry, and it faces operational challenges such as a high balance in accounts receivable, declining average selling prices, and a shrinking gross profit margin. Understanding the current conditions of the energy storage market through Gaot Electronic could provide valuable insights.

Focus on Energy Storage BMS Products with High Accounts Receivable

Gaot Electronic specializes in comprehensive lifecycle management of new energy storage systems, building a “BMS + vertically integrated industrial ecosystem” centered around energy storage BMS products. These products are widely used in high-voltage energy storage power stations on the power supply/grid side, as well as in commercial, industrial, and residential energy storage applications. Additionally, the company offers backup power BMS for critical infrastructure such as data centers, communication bases, and rail transit, along with power battery BMS for electric vehicles and ships, and electricity testing services.

The company’s energy storage BMS products include BMS modules, high-voltage boxes, busbars, integrated control units, and cable harnesses. The integrated control unit aggregates data from microgrid loads, storage, photovoltaics, and charging stations to enable monitoring, fault diagnosis, and energy management functions, primarily used in commercial energy storage systems, park microgrid systems, and distributed solar storage applications.

Gaot Electronic’s backup power BMS is designed for battery management in critical facilities such as data centers and power substations, utilizing single-battery collection modules and multi-level redundancy protection to ensure reliable operation under extreme conditions. The power battery BMS serves as a core component for battery systems in electric vehicles, electric ships, and industrial vehicles, focusing on real-time monitoring of battery voltage and temperature, assessing SOC/SOH/SOP status, and implementing multiple safety protections.

During the period from 2022 to the first half of 2025, revenue from Gaot Electronic’s energy storage BMS products accounted for approximately 90% of total revenue, indicating a significant dependency. In contrast, integrated control units, data services, backup power, and power battery BMS products contributed a smaller portion of revenue.

The upstream of the energy storage supply chain includes raw materials and equipment suppliers such as Huayou Cobalt, China Molybdenum, CATL, BYD, GEM, BETTER RE, and PAT. The midstream encompasses the manufacturing of energy storage equipment, system integration, and operational maintenance, with Gaot Electronic’s core product, energy storage BMS, situated in this segment alongside companies like Sunpower, Huasu Technology, Peicheng Technology, and Kegong Electronics.

Downstream application scenarios include the power supply side, grid side, and user side, featuring companies like State Power Investment Corporation, Longyuan Power, State Grid, Southern Power Grid, and Pine Technology. Gaot Electronic requires thousands of materials for production, mainly categorized into electrical components, discrete devices, integrated circuits, and cable harnesses, procured from suppliers like Xinda, Liudeng Electronics, Jixun Electric, Yibin Micro, Dezhen Technology, and Huayi Electric.

Throughout the reporting period, the company has served mainstream energy storage system integrators, battery manufacturers, and energy firms, including Canadian Solar, JinkoSolar, Haicheng Energy, CRRC Group, Guoxiang Technology, Yiwei Lithium Energy, Ganfeng Lithium, State Grid, and Guoxuan High-Tech. Notably, as the company’s operational scale continues to expand, its accounts receivable balance has also increased annually. At the end of each reporting period, Gaot Electronic’s accounts receivable were valued at approximately 185 million, 402 million, 506 million, and 577 million, accounting for over 50% of total revenue, indicating a high accounts receivable balance and potential bad debt risks.

Additionally, during the reporting period, the direct export sales scale of Gaot Electronic’s BMS products was relatively small, primarily sold indirectly through domestic clients who integrated them into energy storage system products for markets in Europe, North America, Central Asia, and Southeast Asia. Future changes in policies related to the renewable energy and energy storage industries in overseas markets could affect the company’s direct and indirect export sales.

Performance Affected by Cyclical Fluctuations in the New Energy Storage Industry

In recent years, driven by the growth of the new energy storage industry, the demand for energy storage BMS products has surged, leading to a continuous expansion in Gaot Electronic’s operational scale. In 2022, 2023, 2024, and the first half of 2025, the company’s operating revenues were approximately 346 million, 779 million, 919 million, and 507 million, with corresponding net profits of 53.75 million, 88.23 million, 98.42 million, and 51.42 million. It is noteworthy that between July and September 2025, the company experienced year-on-year growth of 60.93% in operating revenue and 72.68% in net profit.

As a technology-intensive industry, BMS requires substantial investment in research and development. During the reporting period, Gaot Electronic’s R&D expenses totaled 23.89 million, 38.64 million, 63.78 million, and 32.28 million, with R&D expense ratios of 6.91%, 4.96%, 6.94%, and 6.36%. It is worth mentioning that the net cash flow generated from operating activities during the reporting period was negative, amounting to -90.45 million, -116 million, 9.95 million, and 2.13 million, remaining below the net profit for the same period.

While the production and sales scale of Gaot Electronic’s BMS products have been expanding, the sales prices of new energy storage systems have sharply declined due to changing market competitive dynamics, cost reduction demands from the energy storage industry chain, and fluctuations in energy storage cell prices. The average selling price of the company’s main products decreased during the reporting period. Although the average winning bid price for energy storage systems in the domestic market has reached a relatively low level, and there has been a recent recovery in the average winning bid price for two-hour energy storage systems in August and September 2025 due to tight supply of energy storage cells and increased project deployment, there remains a risk of further price declines in the future.

As the energy storage industry rapidly evolves, the number of market participants is increasing, leading to heightened competition that extends to upstream segments like cells, BMS, and PCS. The gross profit margins of Gaot Electronic’s core business during the reporting period were 28.37%, 26.53%, 26.02%, and 22.02%, showing a downward trend and falling below the average gross profit margin of comparable companies in the industry.

Regarding market scale, data from CNESA indicates that by the end of 2024, the global new energy storage market will have an installed capacity of approximately 165.4 GW, reflecting an 81.1% increase from the previous year. The lithium-ion battery storage market holds a dominant market share of 97.5%. In terms of installed capacity by region, China, Europe, and the USA continue to lead global energy storage market development, with these three regions accounting for 90% of the newly installed capacity, including 59% from the Chinese market.

As of the end of 2024, the cumulative installed capacity of new energy storage in China is expected to reach 78.3 GW / 184.2 GWh, with a significant milestone of surpassing 100 GWh for cumulative energy installation. In 2024, the newly operational installed capacity of new energy storage is projected to be 43.7 GW / 109.8 GWh, indicating a year-on-year growth of 103% / 136%.

Under conservative scenarios, the cumulative scale of new energy storage is expected to reach 236.1 GW by 2030, with a compound annual growth rate of 20.2% from 2024 to 2030. In an ideal scenario, this figure could rise to 291.2 GW, with a CAGR of 24.5% for the same period. Despite the continued growth in installed capacity and market demand for new energy storage projects, the growth rate of yearly new installations has begun to slow down. Future changes in the global macroeconomic and trade environment or adjustments in policies related to the energy storage industry could potentially limit the expected growth rate of the new energy storage sector or lead to market saturation, impacting the overall industry outlook and the operational performance of companies like Gaot Electronic.

Hangzhou, Zhejiang Emerges as an IPO Hub

Gaot Electronic is registered in Yuhang District, Hangzhou, Zhejiang Province. Originally founded in 1998 as Gaot Limited by Xujianhong, Xutao, Lizhenjiang, and Shenbinghua, the company transitioned to a joint-stock company in 2016. The company has undergone several capital increases and share transfers throughout its development. Notably, in March 2025, Fujian Green Development transferred its shares at a price of 12.02 per share, valuing the company at 4.327 billion. Prior to this issuance, Xujianhong controlled 46.17% of Gaot Electronic’s shares and is recognized as the actual controller. Other shareholders include Zhou Haibo, Huaqiang Ruihua, Li Xiaodong, Sinopec Capital, and Shen Yousheng.

The management team includes Chairman and General Manager Xujianhong, born in 1961 and a graduate of Zhejiang University with a degree in semiconductor devices. He has a history of working from a production technician to workshop director at Hangzhou Semiconductor Device Factory and has held managerial positions at Zhejiang Huatai Functional Materials Joint Company. He has been with Gaot Electronic since February 1998. Board member Zhou Haibo, born in 1962, is also a Zhejiang University graduate with a degree in semiconductor technology. His career includes various roles, including being a chef in Italy and the general manager of a textile company. He has been the chairman of Shaoxing Jiayi Agricultural Development Co., Ltd. since October 2013. Li Xigang, born in 1962 and a graduate with a master’s degree, has previously worked in various managerial roles and has been with Gaot Electronic since February 2019.

In this IPO, Gaot Electronic plans to raise 850 million yuan for the construction of an intelligent manufacturing center for energy storage battery management systems and to supplement working capital.