IPO Outlook | Behind the Second Attempt at the Hong Kong Stock Market by Guangdong Shushijia: The cold chain digitalization leader earns 5.9 billion annually, with a gross profit margin consistently below 3%.

The cold chain market of Shenzhen Agricultural Power Group in China is undergoing a phase of certain growth. In recent years, driven by policy incentives, the expansion of cold storage and logistics capabilities, as well as a growing consumer demand for fresh and high-quality products, the market has been continuously expanding. Data shows that by 2025, the scale of Chinas Shenzhen Agricultural Power Group cold chain market will grow to 531.9 billion yuan, an increase of over 23% from 430.8 billion yuan in 2021; the cold chain sales market of Shenzhen Agricultural Power Group is expected to reach 3.6439 trillion yuan, reflecting a 28.5% increase from 2.8367 trillion yuan in 2021. However, the current stage of the industry still prominently features characteristics of being "large but not strong," with numerous participants, low concentration, varying levels of standardization, and a persistently low penetration rate of digitalization; many circulation links still rely on manual experience and offline coordination. This structural gap also gives rise to substantial new business opportunities. GMTEight has noted that Shenzhen Yue Shi Holdings Co., Ltd. (hereinafter referred to as "Yue Shi Smart") recently submitted its prospectus to the Hong Kong Stock Exchange again. Established in 2019, the company positions itself as a "technology-driven enterprise" and has independently developed and continually upgraded the Yue Shi Smart Cold Chain Cloud Platform. As of July 21st, Yue Shi Smarts comprehensive cold chain digital solutions have been configured by over 750 domestic cold chain operators, covering approximately 30 provinces, autonomous regions, and municipalities across the country; according to 2025 cold chain revenue rankings, the company ranks sixth in the Chinese cold chain digital sales market. However, a more complex picture unfolds when examining the prospectus: Yue Shi Smart recorded a cumulative net loss of over 2 billion yuan from 2023 to 2025, with continued negative cash flow from operating activities. Whether Yue Shi Smart, labeled as a technology company, can impress the discerning investors in the secondary market based on its fundamentals appears to be a question that still requires time to verify. Explosive growth in revenue: a WINOX performance indicator? In the past few years, as Chinas cold chain logistics infrastructure has advanced alongside the digitalization of agriculture, the cold chain sales market has continued to expand. Data indicates that by 2025, the scale of Chinas cold chain digital sales market will reach 601.2 billion yuan. Benefiting from favorable policies supporting the development of cold chain infrastructure and logistics digitalization, Yue Shi Smarts revenue scale has experienced explosive growth between 2023 and 2025, increasing from 1.254 billion yuan to 5.937 billion yuan, corresponding to a compound annual growth rate of 117.6%. In the first four months of this year, Yue Shi Smarts revenue reached 2.805 billion yuan, an increase of 88.8% year-on-year. Breaking down the revenue structure, cold chain sales are the primary source of income for Yue Shi Smart. From 2023 to 2025, revenue from this business accounted for 98.2%, 98.9%, and 99.3% of total revenue, respectively. For the entire year of 2025, cold chain sales contributed 5.898 billion yuan in revenue. In contrast, the revenue from cold chain digital solutions in 2025 was only about 37.5 million yuan, with its share of total revenue declining from 1.8% in 2023 to 0.7%. In terms of profitability differences, the gross margins of the aforementioned two business lines at Yue Shi Smart are vastly different: from 2023 to the first four months of 2026, the comprehensive gross margins of the cold chain digital solutions business were 82.2%, 89.8%, 93.8%, and 94.4%, remaining consistently above 80% and showing a year-on-year increase; in comparison, the gross margin of cold chain sales has long hovered below 3%. The weak profitability of its main business has resulted in a low overall gross margin for Yue Shi Smart. Data shows that between 2023 and the first four months of 2026, the company's gross profits were 22.776 million yuan, 80.989 million yuan, 169 million yuan, and 72.99 million yuan, corresponding to gross margins of 1.8%, 2.7%, 2.8%, and 2.6% respectively. Moreover, in terms of net profit, Yue Shi Smart's net losses were 28.266 million yuan, 219 million yuan, and 1.764 billion yuan from 2023 to 2025, with total net losses exceeding 2 billion yuan over the three years. In the first four months of 2026, Yue Shi Smart reported a net profit of 35.882 million yuan, successfully returning to profitability. It is worth mentioning that Yue Shi Smart recorded a significant loss in 2025, but this was not due to poor management; rather, it stemmed from a book loss of 1.833 billion yuan resulting from changes in the fair value of the issued preferred shares, which accounted for 104% of the total loss for that year. With the momentum of business expansion, the effectiveness of strategic implementation remains to be tested. With a low base for profits, can the newly resubmitted Yue Shi Smart forcefully push through the doors of the Hong Kong stock market? From an industry perspective, the current cold chain digital sales sector is still expanding. At present, the digital penetration rate of the cold chain sales market remains relatively low, and the digital needs of many small and medium-sized wholesalers and cold chain operators have yet to be fully met. According to data from Frost & Sullivan, the Chinese cold chain digital sales market is expected to reach 1.05 trillion yuan by 2030, with a compound annual growth rate of 11.7% from 2025 to 2030, significantly higher than the overall growth rate of the cold chain sales market at 4.1%. In other words, the segment in which Yue Shi Smart operates still has considerable growth potential. In terms of strategic paths, Yue Shi Smart's prospectus outlines four clear directions for advancement: overseas expansion, domestic penetration, R&D investment, and strategic investment. Among these, the overseas market is the most noteworthy new variable for Yue Shi Smart. The company plans to phase its entry into stable demand regions for imported cold chains, such as Southeast Asia and the Middle East, while selectively exploring opportunities in North America and Europe. The essence of this strategy is to replicate the "procurement-sales" chain that has already been successful domestically. However, overseas expansion entails higher operational costs and more complex compliance requirements, and the companys execution capabilities in this area remain to be validated. The domestic market strategy is more focused on leveraging existing capacity. Yue Shi Smart plans to rely on the 750+ cold chain operator nodes already deployed to reach a concentrated potential customer base at a lower cost, converting these into transaction customers through standardized onboarding processes and transparent pricing mechanisms. The logic here is that the existing solution deployment network itself serves as a customer acquisition channel, eliminating the need for a large offline sales team as traditional traders rely on. Meanwhile, by analyzing historical transaction data and regional demand characteristics to optimize product offerings, the company aims to enhance transaction frequency and average transaction value for existing customers. From a research and development perspective, the company plans to continuously strengthen its data analytics capabilities, shifting R&D focus from perfecting platform functions to data governance and intelligent decision-making support. Additionally, the company has reserved funds for selective investments and acquisitions, targeting domestic and foreign cold chain traders and upstream slaughter processing enterprises with established market positions, intending to improve the industrial chain layout through external mergers and acquisitions. However, the credibility of strategic planning ultimately depends on the rhythm and efficiency of execution. The geographic differences of overseas markets, the long-term nature of brand building, and the uncertainties of acquisition and integration pose real challenges for Yue Shi Smart. With profits still relatively low, whether these investments can transform into substantial profit contributions within a foreseeable timeframe is a question that the market must consider when assessing its long-term value. In summary, Yue Shi Smart's rapid revenue growth validates its business model's potential in a highly prosperous niche market, but as the company submits its second prospectus, the market is likely to scrutinize it with a more cautious eye. When will the high-gross-margin cold chain digital solutions business see significant volume? Can the profit ceiling of cold chain sales truly be broken? Will long-cycle investments like overseas expansion and brand building deliver results as expected? In my view, this series of questions will likely not have clear answers in the short term. In the secondary market, Yue Shi Smart, tagged as a technology company, will still need to present a more solid profitability performance to genuinely convince investors of its long-term value.