Data Intelligence Connects to Hong Kong Stock IPO: Operating Cash Flow to Drop 340% by 2025, Concerns Behind 20-Fold Surge in Overseas Business Revenue

A Two-Track Model for Full-Chain Brand Operations Providers

JuShu ZhiLian positions itself as a technology-driven full-chain brand operations provider and adopts a dual-track operating model of product sales and service delivery. In the product sales track, as the main model, the company purchases products from brand cooperation partners or their authorized distributors and holds title to the inventory, and then resells them to consumers or e-commerce platforms and distributors. The service delivery track covers e-commerce operating services such as store operations, content marketing, and supply chain management.

The company’s business is divided into three major segments: domestic e-commerce brand operations, general agency and authorized brand operations, and overseas e-commerce brand operations that are fully expanded in 2025. Among the overseas business, there are two sub-segments: cross-border e-commerce for Chinese brands and the development of its own brands. To date, it has already helped expand international markets for brands such as iFlytek (科大讯飞).

Large Revenue Swings Twice in Three Years: 16.6%

The company’s revenue over the past three years shows a distinct dynamic pattern of declining first and then rising. In 2023, revenue was 1.593 billion yuan; in 2024, it fell 13.5% to 1.379 billion yuan; in 2025, it rebounded 16.6% to 1.608 billion yuan. The revenue fluctuations were mainly driven by the combined impact of declining revenue from domestic e-commerce brand operations and the rapid expansion of overseas business.

Revenue changes for the years ended December 31:

• | | 2024 | 1,378,665 | -13.5% | | 2025 | 1,607,699 | +16.6% |

Net Profit Fluctuations of 482% Over Three Years

The company’s profitability fluctuates significantly. In 2023, it achieved net profit of 80.485 million yuan; in 2024, it sharply dropped 88.6% to 9.168 million yuan; in 2025, it rebounded substantially by 373.4% to 43.399 million yuan, but it still had not recovered to the 2023 level. The profit fluctuations were mainly influenced by multiple factors, including revenue changes, gross margin fluctuations, and expense control.

Net profit for the years ended December 31:

• | | 2024 | 9,168 | -88.6% | | 2025 | 43,399 | +373.4% |

Gross Margin Oscillates by 3.6 Percentage Points Over Three Years

Gross margin performance shows a trend of declining first and then rising. In 2023, gross margin was 21.4%; in 2024, it fell by 1.9 percentage points to 19.5%; in 2025, it rebounded by 3.6 percentage points to 23.1%. The company explains that the increase in gross margin in 2025 was mainly attributable to an optimized brand mix and the contribution from overseas e-commerce brand operations.

Gross margin for the years ended December 31:

• | | 2024 | 19.5 | -1.9 | | 2025 | 23.1 | +3.6 |

Net Profit Margin Fluctuates by 4.4 Percentage Points Over Three Years

The magnitude of net profit margin fluctuations is greater than that of gross margin. In 2023, net profit margin was 5.1%; in 2024, it sharply declined to 0.7%; in 2025, it recovered to 2.7%, still 2.4 percentage points lower than in 2023. Over the three years, the difference between the highest and lowest net profit margin values was 4.4 percentage points, reflecting weaker profitability stability.

Net profit margin for the years ended December 31:

• | | 2024 | 0.7 | -4.4 | | 2025 | 2.7 | +2.0 |

A Dramatic Change in Business Structure: Overseas Business Rises from 0 to 21.8%

The company’s revenue composition changed significantly. In 2023-2024, the domestic e-commerce brand operations segment accounted for 98.7% in both years. In 2025, due to overseas expansion, the proportion dropped to 75.5%. Overseas e-commerce brand operations contributed revenue of 351 million yuan in 2025, accounting for 21.8% of total revenue, becoming the second-largest business segment.

Revenue composition for the years ended December 31:

• |
• |
• |
• | 350,867 | 21.8% | | Total | 1,593,359 | 100.0% | 1,378,665 | 100.0% | 1,607,699 | 100.0% |

Related-Party Transactions Not Disclosed in Specific Amounts

The prospectus does not disclose in detail the specific amounts and proportions of related-party transactions; it only mentions that the company’s major suppliers include brand cooperation partners or their authorized distributors. Investors should pay attention to whether material related-party transactions may exist in the future, and whether these transactions are conducted at fair prices. Insufficient transparency in related-party transactions may conceal risks of potential transfer of benefits.

Cash Flow Deteriorates: Operating Cash Flow Turns Negative in 2025

The company’s cash flow situation continues to worsen. In 2023, net operating cash flow was 129 million yuan; in 2024, it fell to 59 million yuan; in 2025, it further deteriorated to -141 million yuan, representing a year-on-year decline of 340%. The main reason is that under the product sales model, the company’s procurement volume from suppliers increased, especially as overseas business expansion led to a substantial increase in inventories and advance payments, significantly increasing cash flow pressure.

Cash flow situation for the years ended December 31:

Intense Industry Competition: Low Market Concentration

According to information from Frost & Sullivan (弗若斯特沙利文), the China brand e-commerce solutions industry is relatively fragmented. In 2024, based on GMV, the top ten companies accounted for only 15.3% of total market share. The company has competitive advantages on the JD.com platform and in the consumer electronics sector, but it faces competition from many peers. In the future, maintaining market share may face significant pressure; high industry fragmentation implies challenges to sustained profitability.

Moderate Customer Concentration, but There Is Dependence

The company’s customer concentration is at a moderate level. From 2023 to 2025, revenue from the top five customers accounted for 23.7%, 24.8%, and 22.9% of total revenue, respectively, and the revenue contribution from the largest customer was 9.0%, 10.3%, and 10.5%, respectively. Although it has not reached a highly concentrated level, the largest customer’s revenue contribution has increased year by year, indicating a certain degree of dependence risk. If major customers were to leave, it would adversely affect the company’s revenue.

High Supplier Concentration: Top Five Account for Over 50%

Supplier concentration is significantly higher than customer concentration. From 2023 to 2025, purchases from the top five suppliers accounted for 47.7%, 57.8%, and 51.4% of total purchases, respectively. The share of purchases from the largest supplier was 16.1%, 14.5%, and 14.9%, respectively. High supplier concentration may put the company in an unfavorable position during procurement negotiations and exposes it to the risk of supply disruption, threatening the stability of the company’s operations.

Mr. Xiong as the Single Largest Shareholder

As of the last date of actual practicability, Mr. Xiong directly holds 16.72% of the company’s equity, and indirectly controls 11.98% of the equity through the employee shareholding platform Huaxin Lanchuang. Together, they control 28.70% of the voting rights, making this the group of the company’s single largest controlling shareholder. After completion of the IPO, Mr. Xiong will directly and indirectly control a certain proportion of the voting rights of the company. The company will not have a controlling shareholder; a dispersed equity structure may lead to lower decision-making efficiency and risks of potential contests over control rights.

Core Management Did Not Disclose Detailed Compensation

The prospectus does not disclose in detail the specific compensation amounts for directors and senior executives or the incentive mechanism; it only mentions that the employee shareholding platform Huaxin Lanchuang holds 11.98% of the equity. Investors may find it difficult to assess the degree of linkage between management compensation and company performance, as well as the effectiveness of incentives. Insufficient compensation transparency may affect judgments about management motivation and corporate governance levels.

Multiple Risk Factors Require Caution

The company faces a range of risks, including: risks of changes in market trends and customer preferences; risks of dependence on brand cooperation partners; challenges from changes in e-commerce channels and technological innovation; risks of dependence on online platforms; risks to technical infrastructure; risks of intensified market competition, etc. Of particular note is that operating risks and cash flow pressure arising from overseas business expansion may further exacerbate uncertainty in the company’s financial position. Investors should carefully evaluate.

Investor Reminder

As a provider of brand e-commerce solutions, JuShu ZhiLian, despite having certain advantages in domestic e-commerce platform operations and the rapid growth of its overseas business, faces multiple risks including significant fluctuations in profitability, deterioration in cash flow, high supplier concentration, and intense market competition. In 2025, operating cash flow turned negative, and continued investment in overseas business may further intensify capital pressure. Investors should prudently evaluate the sustainability of the company’s business model and various risk factors, and make investment decisions rationally.

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Responsible editor: Xiao Lang Express