Annual Report Review | Zhangjiang Hi-Tech: Caught Between Tech Investment and Cash Pressure

Viewpoint Network, in 2021, Zhangjiang Hi-Tech, at a time when the industry was riding the wave of transformation, set a mission: to shift from promoting development on the company’s own behalf to becoming a technology industrial investment and holding group. Its core business focuses on the integrated circuit sector, while it also lays out the biopharmaceutical and artificial intelligence industries, carrying out related businesses such as industrial investment, space operations, and ecosystem services.

In the announcement, this is referred to as the “14th Five-Year Plan goal and task.”

Five years have passed, and Zhangjiang Hi-Tech has arrived at the wrap-up year for completing this goal and task.

For FY2025, Zhangjiang Hi-Tech achieved operating revenue of RMB 4.182 billion, up 110.85% year over year, mainly due to the recognition of revenue from rental housing and industrial office space carriers that it sold. It recorded total profit of RMB 1.267 billion, down 0.56% year over year. Net profit attributable to shareholders was RMB 986 million, up 0.38% year over year. Net profit excluding non-recurring gains and losses was RMB 907 million, down 2.2% year over year.

By the end of 2025, Zhangjiang Hi-Tech’s total assets increased from RMB 59.402 billion to RMB 63.109 billion.

In terms of development pace, in 2025, Zhangjiang Hi-Tech had a total of 6 projects under construction, with a total gross floor area of about 1.34 million square meters. It started construction on 1 new project during the year, with a total gross floor area of 27,000 square meters. It completed 3 projects during the year, with a total gross floor area of about 500,000 square meters.

Behind the doubling of revenue

This year, Zhangjiang Hi-Tech’s operating focus was still mainly on the industrial space carrier business. Its revenue during the year was RMB 4.159 billion, up 112.12% from 2024. Service revenue was only RMB 8.8287 million, but it was also up about 43.79% from 2024.

However, because operating costs rose significantly this year, the gross margin of the above businesses was affected: the former decreased by 7.88 percentage points, and the latter decreased by 28.11 percentage points.

“Operating costs increased by 150.46% compared with the same period last year. The main reason is that in this period, the company’s sales revenue from industrial space carriers increased, and the corresponding cost of sales carried forward also increased accordingly.” Zhangjiang Hi-Tech said.

According to information, Zhangjiang Hi-Tech’s cost of sales segment mainly includes employee compensation, fees for intermediary institutions, sales service fees,招商代理费用, advertising and depreciation expenses. As per the annual report reviewed by the Industry Technology Link, among the above expenses, except for sales service fees, all of them saw substantial increases, causing total sales expenses to nearly double from RMB 57.8585 million in 2024 to RMB 95.6104 million.

In its real estate business, Zhangjiang Hi-Tech also mainly focuses on sales, with its development steps temporarily slowing down. In 2025, there was no new real estate project reserve. The newly commenced area in the real estate business was 27,000 square meters, and the completed projects totaled 508,000 square meters. Among them, the completed projects in the fourth quarter alone accounted for 405,000 square meters.

In 2025, Zhangjiang Hi-Tech’s real estate business signed sales area of 218,500 square meters, achieving contract sales amount of RMB 2.99 billion, up 228.3% from 2024. In addition, the real estate business obtained total rental income of RMB 1.17 billion, up 11.49% year over year.

In real estate business sales revenue, including a transaction amount allocated to performance obligations that have not been fulfilled (or partially not been fulfilled). Put simply, this amount is the contract value that Zhangjiang Hi-Tech has signed but has not yet recognized as revenue, roughly equivalent to RMB 293 million.

“This portion of the funds mainly comes from real estate projects that have been presold but have not yet met delivery conditions. It is expected that within the coming 1 year, once the contract-specified delivery conditions are met and customers obtain control of the goods, the above funds will be recognized and carried forward as sales revenue.” That means, currently Zhangjiang Hi-Tech still has nearly RMB 300 million of real estate sales proceeds to be carried forward and completed in 2026.

For the rental housing (lease) business, on the evening of December 30, Zhangjiang Hi-Tech previously announced that the company or a designated entity plans to participate in an investment in the Jianghe Yaоchen Enterprise Management Center (Limited Partnership). The fundraising size of the partnership enterprise will be no more than RMB 700 million. As the limited partner, the company’s subscribed capital contribution will be no more than RMB 140 million.

According to the announcement, the investment strategy of the partnership enterprise clearly focuses on Zhangjiang Science City’s affordable rental housing and other existing state-owned assets that meet the requirements. It will be invested in through ways such as acquiring projects by establishing new project companies, capital increases, or acquiring equity, aiming to improve asset value and enhance operations through acquiring and revitalizing assets, helping state-owned enterprises transform and increasing asset value. The exit routes mainly include issuing publicly offered REITs, inter-institution REITs, quasi-REITs, and transferring to entities that meet the conditions, etc.

Zhangjiang Hi-Tech stated that, as the main operating entity of Zhangjiang Science City, its participation in this investment can leverage social capital and innovative financial instruments to revitalize the existing stock of affordable rental housing and state-owned stock assets within the region, improve asset liquidity, and promote the company’s transformation and development.

Although in 2025 Zhangjiang Hi-Tech has entered the affordable rental housing track, its core investment logic is still anchored to technology-led business formats.

“Tech investment bank” hidden concerns

In the week prior to the release of its annual report, Zhangjiang Hi-Tech invested in another technology company.

According to Zhangjiang Hi-Tech’s announcement, on March 24, 2026, its wholly-owned subsidiary, Shanghai Zhangjiang Haocheng Venture Capital Co., Ltd., is planning to, as a limited partner, subscribe and contribute RMB 100 million from its own funds to participate in an investment in Shanghai Lihesuan AI Industrial Entrepreneurship Investment Partnership (Limited Partnership), accounting for 10% of the fund’s target size.

According to materials, the fund’s target size is about RMB 1 billion, with a term of 5 years for the investment period + 5 years for the management and exit period + 2 years for the extension period. The fund manager is Lihesuanke Private Equity Fund Management (Shenzhen) Co., Ltd. Other major contributors include Shanghai Guotou Xianling Artificial Intelligence Private Investment Fund Partnership (Limited Partnership) and Shanghai Pudong Leading Zone Investment Center (Limited Partnership), etc.

It is understood that this fund mainly invests in areas related to artificial intelligence. “This investment is conducive to leveraging the fund’s role as an investment link. Through the ‘recruit, invest, incubate’ alignment, it will promote the construction of Pudong’s AI innovation ecosystem.”

As of the end of 2025, Zhangjiang Hi-Tech’s cumulative investment scale was RMB 10.6 billion. Of this, there are 59 direct investment projects with an investment amount of RMB 5.3 billion; and it participates in 31 investment funds, with subscribed amounts of RMB 5.3 billion.

In terms of investment direction, Zhangjiang Hi-Tech prefers the integrated circuit industry, with an investment scale of RMB 3.043 billion. In addition, biopharmaceuticals were RMB 1.347 billion, new energy RMB 2.0 billion, aerospace RMB 150 million, and intelligent manufacturing RMB 273 million.

With the nickname “tech investment bank,” Zhangjiang Hi-Tech as early as September 28, 2024 initiated the establishment of the “Shanghai Zhangjiang Suiyue Entrepreneurship Investment Partnership (Limited Partnership)”. In May 2025, its wholly-owned subsidiary, Shanghai Zhangjiang Haocheng Venture Capital Co., Ltd., also participated in investing in the Yuanye Puhua Integrated Circuit Industry Fund (Limited Partnership).

It is understood that this fund’s fundraising target size reaches RMB 2.0 billion, and Shanghai Zhangjiang Haocheng Venture Capital Co., Ltd. as the limited partner subscribed a capital contribution of about RMB 100 million.

In the semiconductor investment arena, Zhangjiang Hi-Tech also bet on multiple companies through subsidiaries and invested funds.

In September 2025, through its subsidiary Shanghai Zhangjiang Haocheng Venture Capital Co., Ltd., it invested RMB 223 million in Shanghai Microelectronics Company, holding 10.779% equity in Shanghai Microelectronics Company.

In addition, Zhangjiang Hi-Tech, through Shanghai Yuanjie Intelligent Technology Equity Investment Fund Partnership (Limited Partnership), indirectly holds about 18% shares of IM Motors. It has also invested in AI and robotics business companies such as Black Sesame Intelligence, Denglin Technology, and TiMi Robotics.

At the third-quarter results conference in November 2025, Zhangjiang Hi-Tech’s management specifically mentioned that for leading industrial investment, the company will conduct an investment layout using a “direct investment + funds” model.

Judging from this, companies such as CloudWalk Technology, Yingchip (rights protection), Zhenqu Technology, and Weijie Chuangxin are basically companies that Zhangjiang Hi-Tech backs with direct investments. Their businesses include multiple fields such as intelligent sensor chips and power semiconductors. Some companies are also invested in by Zhangjiang Hi-Tech through its affiliated funds—for example, in November 2025, the listed fund Zhangjiang SuiFeng Fund invested in a commercial aerospace company—Blue Arrow Aerospace.

From Zhangjiang Hi-Tech’s investment trajectory, in 2025 it reached investment arrangements with multiple companies. But in the 2025 annual report data, there is also a certain amount of short-term debt repayment pressure in practice.

The annual report shows that Zhangjiang Hi-Tech’s short-term borrowings were approximately RMB 8.608 billion, up 254.65% year over year. Taxes payable increased by 47.92% compared with the beginning of the period, mainly due to an increase in enterprise income tax, land appreciation tax, and property tax payable at period end.

Of this, short-term borrowings due within 6 months were approximately RMB 4.831 billion, and short-term borrowings that need to be resolved within 1 year were about RMB 3.959 billion. As of now, Zhangjiang Hi-Tech’s cash on hand is approximately RMB 3.855 billion.

In addition, Zhangjiang Hi-Tech’s other payables during the reporting period also increased by 74.46% compared with the beginning of the period; non-current liabilities due within one year increased by 37.95% compared with the beginning of the period, because the payables bonds due within one year under its subsidiaries have been accumulating continuously.

“To address future operating risks, in recent years, the company has slowed down the pace of acquiring new projects, shifted its focus to operating existing projects, which has caused the annual investment in existing construction projects and the payment amounts of retention money for completed projects to decline year by year. At the same time, relying on the ‘Investment, Recruitment, Incubation, Service, Research’ industrial service system, the company carries out business around the innovation and technology supply chain.”

Zhangjiang Hi-Tech stated that to cope with future operating risks, it has cooperated with various financial institutions to set up and allocate REITs of various categories, broadening property exit channels. For mature-phase industrial investment projects, it negotiates exits through multiple routes, and it continues to explore various capital and money market financing tools both domestically and overseas, increasing financing efforts to reduce financing costs and ensure the company’s funding position remains stable over the long term.

Disclaimer: The content and data in this article are compiled by Viewpoint based on publicly available information and do not constitute investment advice. Please verify before use.

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