Puran Co., Ltd. Stock Price Leads While Performance Lags; Can Noah Long-term Capital Break Through with Triple "Increase"

Ask AI · Can the acquisition of Noah Changtian by SanDu unlock new growth points through product complementarity?

PuRan Co., Ltd. (688766.SH) simultaneously disclosed its 2025 annual report and asset acquisition announcement on March 22.

The financial report shows that the company achieved an operating revenue of 2.32 billion yuan for the year, a year-on-year increase of approximately 28.6%. Net profit attributable to shareholders was 208 million yuan, a decrease of nearly 30%, presenting a typical “higher revenue, lower profit” situation. During the reporting period, the company’s gross profit margin declined by 5.19 percentage points year-on-year. Rising R&D, management, and sales expenses, along with inventory impairment losses caused by a relatively active stocking strategy, jointly eroded profits.

Meanwhile, PuRan announced plans to acquire the remaining 49% stake in Zhuhai Noah Changtian Storage Technology Co., Ltd. (“Noah Changtian”) at a valuation of 247 million yuan through a combination of issuing shares, convertible bonds, and cash payments. This is the company’s third capital operation in 2025, following transactions in March and November. After the deal closes, Noah Changtian will become a controlling subsidiary of PuRan.

In the context of the storage chip industry entering an AI-driven boom cycle, PuRan’s stock price has surged 376% over the past 10 months, but performance has not yet matched the valuation increase, and the fundamental validation moment is approaching.

As of the close on March 23, PuRan’s stock price was 273.11 yuan, down 2.46%, with a total market value of 40.4 billion yuan.

Gross Margin Under Double Pressure

The annual report shows that PuRan achieved an operating revenue of 2.32 billion yuan, up 28.6% year-on-year. However, revenue growth did not translate into profit growth; net profit attributable to shareholders fell from 292 million yuan in 2024 to 208 million yuan in 2025, a decrease of 29.03%.

PuRan mainly engages in the design and sales of storage chips, including non-volatile memory chips such as NOR Flash, EEPROM, and SLC NAND Flash, as well as derivative products like eMMC, mainly used in mobile phones, computers, network communications, home appliances, industrial control, and IoT fields.

Benefiting from industry trends in the storage chip market and strong demand, the shipment volume of PuRan’s main storage chip products increased year-on-year. Coupled with market share gains in MCU products and analog products like Driver, this drove revenue growth.

Looking at product segments, storage series chips are PuRan’s core business. During the period, this segment achieved revenue of 1.787 billion yuan, up 26.10% year-on-year, with a gross margin of 29.54%, and shipped 7.183 billion units, up 6.06%. Additionally, the company’s “Storage+” series, covering MCU chips and analog products like VCM Driver chips, generated revenue of 532 million yuan, up 37.91%, with a gross margin of 24.42%, down 5.21 percentage points, and shipped 1.463 billion units, up 68.18%.

The 5.19 percentage point year-on-year decrease in gross margin in 2025 is the main reason for the “higher revenue, lower profit” situation. The company explained in the annual report that although market demand was concentrated and downstream demand was strong from Q2 onwards, product prices faced significant pressure due to differing price change rhythms across the industry supply chain and product mix changes.

Rapid expense growth further compressed profits. In 2025, R&D expenses reached 297 million yuan, up 22.86% from 242 million yuan in 2024; management expenses increased from 58 million yuan to 89 million yuan, a 51.51% increase; sales expenses rose from 57 million yuan to 85 million yuan, an increase of about 49.02%.

PuRan stated that the company continues to increase R&D investment, and as the workforce, especially the R&D team, expands, total employee compensation has significantly increased. Additionally, external acquisitions aimed at expanding technology and market share have involved corresponding integration and operational costs.

In the first half of last year, facing supply and demand trends in emerging markets, PuRan adopted a relatively proactive stocking strategy, which increased inventory levels, lowered inventory turnover, and led to inventory impairment losses that eroded net profit.

According to the announcement, in 2025, the company recognized an inventory impairment provision of 84.97 million yuan, with asset impairment losses increasing by about 62.54 million yuan year-on-year. After reversing some impairment provisions, the impairment loss reduced the company’s total profit by 37.94 million yuan.

Can Performance Growth Points Be Opened?

Alongside the release of its annual report, PuRan also announced a plan to acquire assets—namely, to continue advancing the full acquisition of Noah Changtian.

According to the announcement, the transaction will involve issuing shares, convertible bonds, and cash payments, with a proposed purchase price of 247 million yuan for a 49% stake in Noah Changtian. The company also plans to issue shares to no more than 35 specific investors to raise up to 77 million yuan to pay the cash consideration, intermediary fees, and repay acquisition loans.

First Financial journalist found that this is the third acquisition of Noah Changtian by PuRan in 2025, following a 90 million yuan purchase of 20% of Noah Changtian in March and a 144 million yuan purchase of 31% in November, gaining control. If completed, Noah Changtian will become a wholly owned subsidiary of PuRan. The transaction is expected to generate goodwill of 129 million yuan.

In fact, the main operating entity of Noah Changtian, SHM (SkyHigh Memory Limited), is the true target of this acquisition. It is a semiconductor company registered in Hong Kong. Established in December 2018 by SK hynix systemics Inc., a subsidiary of SK Hynix, SHM has “genes” of a major storage manufacturer.

The announcement states that SHM’s main business focuses on mid-to-high-end 2D NAND and derivative storage chips (SLC NAND, eMMC, MCP). According to market research data from TrendForce, SHM was the fourth-largest SLC NAND manufacturer globally in 2024, behind Kioxia, Micron, and Winbond.

In terms of performance, Noah Changtian’s main revenue comes from overseas markets. In 2025, SHM’s main business revenue is expected to reach 1.35 billion yuan, mainly from sales of SLC NAND, eMMC, and MCP products.

PuRan’s existing products mainly include NOR Flash and EEPROM non-volatile memory chips. The core products of the target company are SLC NAND and eMMC. PuRan stated that through this acquisition, it will further improve its non-volatile storage product layout, achieve product complementarity, and build a more complete global sales network. The transaction is still subject to approval by the company’s shareholders.

Stock prices have led performance, vividly reflected in PuRan’s stock price and performance. Over the past 10 months, the stock price has surged 376%, significantly increasing valuation. The market generally attributes this to the super cycle in storage chips driven by AI breakthroughs. With emerging scenarios like AI large models, edge AI, and automotive electronics, the storage industry has entered a new upward cycle, and industry prosperity continues to rise, fueling market expectations for growth in storage chip companies.

However, according to the 2025 annual report, the company’s performance has not kept pace with the stock price increase. The “higher revenue, lower profit” situation highlights a clear gap between fundamentals and valuation. Investors’ expectations for performance improvement may still hinge on the company’s full acquisition of Noah Changtian and the indirect control of SHM, which could expand the growth space of its 2D NAND products.

As this acquisition progresses, the key factors will be how effectively PuRan integrates Noah Changtian, the pace of synergy realization, and whether industry cycles can sustain performance growth—these will determine whether the company’s stock price, which has led performance, can be justified by future results.

(This article is from First Financial)