The dual drivers of industry demand and policy dividends make this the right time for strategic positioning in the trough.
Juchuan Optoelectronics Technology (Shanghai) Co., Ltd. (stock code: 688391) was established in 2005 and is a leading supplier of smart grid terminal device chips in China. The company went public on the STAR Market in September 2022. Its main business includes the research, design, and sales of smart grid terminal device chips, with key products including energy metering chips, smart meter MCU chips, and power line communication chips.
As a leading enterprise in the domestic smart meter chip sector, Juchuan Technology has consistently ranked first in the domestic market shipment volume of three-phase metering chips, with a market share exceeding 60% in the domestic unified recruitment market for three-phase metering chips in 2024.
The company also ranks among the top in the fields of single-phase metering chips, MCU chips, and power line communication chips.
01 Industry Position and Market Advantages: The Invisible Champion of Smart Grid Chips
Juchuan Technology has established a solid moat in the smart grid chip sector. According to the 2025 semi-annual report, the revenue contribution of the company’s smart meter chips reached 85.13%, making it the absolute core of this business.
The company holds a leading position in the domestic smart meter metering chip market, with a market share exceeding 60% for three-phase metering chips and approximately 35% for single-phase chips, covering the supply chains of major domestic meter manufacturers.
In the latest ranking of the power line communication industry, Juchuan Technology’s rolling revenue over the past twelve months was 592 million yuan, ranking third globally and domestically.
The company’s customer base is of high quality, achieving nearly full coverage of the top 20 customers in the industry, including leading downstream meter manufacturers such as Samsung Medical, Linyang Energy, and Chint Instruments, with end customers primarily being the two major domestic grid companies and their subsidiaries, as well as overseas grid enterprises.
This market position not only brings scale effects but also creates high customer switching barriers. Meter chips, as the core components of smart meters, require high stability and reliability; once certified and applied in bulk, they typically form long-term stable partnerships.
02 Financial Performance Analysis: Short-term Pressure and Structural Issues Emerge
In the first three quarters of 2025, Juchuan Technology achieved total operating revenue of 408 million yuan, a year-on-year decrease of 9.17%; net profit attributable to the parent company was 44.54 million yuan, a year-on-year decrease of 37.71%. In the third quarter alone, the net profit attributable to the parent company was 7.05 million yuan, a year-on-year decrease of 53.79%.
The decline in profitability is significant. In the first three quarters of 2025, the company’s gross margin was 39.95%, a decrease of 8.2 percentage points year-on-year; the net profit margin was 10.91%, a decrease of 31.42% year-on-year. This data shows a more pronounced decline compared to the high points of the same period in 2023 (gross margin of 50.89%, net profit margin of 24.82%).
More concerning is that the company’s main business profit for the first half of 2025 was -1.64 million yuan, compared to 27.92 million yuan in the same period last year, indicating a shift from profit to loss. This shift was mainly due to a year-on-year decline of 11.39% in total operating revenue and a year-on-year decrease of 2.85% in gross margin.
In terms of cash flow, Juchuan Technology reported a net cash flow of -559 million yuan in the first half of 2025, compared to 40.35 million yuan in the same period last year, indicating a shift from positive to negative.
Additionally, the company has a large amount of accounts receivable, which accounted for 76.04% of the net profit attributable to the parent company in the latest annual report.
From the balance sheet perspective, by the end of the third quarter of 2025, the company’s total assets were 1.974 billion yuan, with accounts receivable at 71.17 million yuan; the net cash flow from operating activities was -102 million yuan.
03 Future Growth Drivers: IR46 Standard and Overseas Strategy
Despite short-term performance pressures, Juchuan Technology still has multiple potential growth points for the future.
The implementation of the new IR46 standard will be the biggest catalyst. The IR46 standard has higher requirements for measurement error, power factor, and environmental adaptability, which will drive the upgrade of smart meters towards intelligence and IoT.
According to the State Grid’s planning, the annual bidding demand for meters in 2025 is expected to remain around 90 million units, with the peak of this round of meter replacement cycle likely to continue until 2026. The bidding volume for smart IoT meters that meet the IR46 standard and have higher unit value is rapidly increasing.
Exporting meters is another significant growth point. In 2023, China exported a total of 55.95 million single-phase and three-phase smart meters, a year-on-year increase of 15.30%. Juchuan Technology’s single-phase SoC chips have gradually entered the forefront of the export market, and the company is developing RISC-V architecture-based MCU chips to meet overseas market demands.
According to data from iiMedia Consulting, the global smart meter market was approximately $12.6 billion in 2023 and is expected to reach $15.2 billion by 2026. The company is expected to seize this vast market with its product advantages.
04 Technology R&D and New Product Layout: BMS Chips and Automotive-grade Breakthroughs
Juchuan Technology has always regarded technological innovation as the core driving force for development. In the first half of 2025, the company invested 90.76 million yuan in R&D, a year-on-year increase of 7.77%, accounting for a remarkable 33.36% of operating revenue.
As of June 30, 2025, the company’s R&D team consisted of 226 people, accounting for 79.30% of the total staff, with 63.72% holding a master’s degree or higher. The company has been granted 103 authorized patents, including 84 invention patents, as well as 68 exclusive rights for integrated circuit layout designs and 21 software copyrights.
In terms of new product layout, the company is actively expanding into the BMS (Battery Management System) chip field. In the second quarter of 2025, the HT3310X power meter has achieved mass production; the HT32F106 chip reached production targets in August 2024; and the HT32F208 series chips are expected to achieve small batch production in the third quarter of 2025.
Notably, the company obtained the ISO26262 functional safety process certification from the National New Energy Vehicle Technology Innovation Center in August 2024 and has proactively laid out the development of automotive-grade AFE chips. This layout opens up a larger market space for the company in the new energy vehicle sector.
The company’s power line communication chips have also successfully been integrated with the Southern Power Grid’s HarmonyOS, completing trial operations in downstream smart IoT meters, making it the first IoT meter in China to be equipped with the HarmonyOS.
05 Valuation Analysis and Investment Considerations
As of October 24, 2025, Juchuan Technology’s PE-TTM was 49.38, lower than the PE-TTM of the analog chip design industry (77.41). As of November 7, 2025, the company’s price-to-earnings ratio (TTM) was 53.29, with a price-to-book ratio of 1.91.
Historically, Juchuan Technology’s recent price-to-earnings ratio is at a high level. This aligns with the company’s short-term performance decline but reflects the market’s optimistic outlook on its long-term growth prospects.
Using the Magic Formula valuation method (proposed by investor Joel Greenblatt), Juchuan Technology’s tangible capital return rate is 2.89%, and the enterprise yield is 1.93%, ranking low in the industry. This indicates that the company’s current profitability and valuation cost-effectiveness do not have a significant advantage in the industry.
However, from the perspective of asset quality, the company has excellent debt repayment capability, ranking second among 164 companies in the semiconductor and components industry, and 21st in asset quality. Additionally, the company’s interest-bearing debt ratio is only 0.02%, indicating minimal debt repayment pressure.
06 Risk Warnings and Future Outlook
Investing in Juchuan Technology requires attention to the following risks:
On one hand, the company faces high industry dependency risks, with its main business highly concentrated in the smart meter chip sector. On the other hand, the progress of the IR46 standard’s popularization, the speed of meter exports, and intensified market competition may all impact the company’s performance.
From a financial risk perspective, the company has a large amount of accounts receivable, and its net cash flow for the first half of 2025 was negative, necessitating attention to collection situations and cash flow improvement.
However, in the long run, Juchuan Technology’s layout aligns with the major trends in industry development. With the acceleration of smart grid construction, the gradual implementation of the IR46 standard, and the growing demand for meter exports, the company is expected to benefit first due to its market position and technological accumulation.
The company is currently in an investment phase, and while high-intensity R&D investment has impacted profit performance in the short term, it lays a solid foundation for future product innovation and market expansion.
As of the third quarter of 2025, Juchuan Technology’s net assets were 1.859 billion yuan, with total assets of 1.974 billion yuan. The company’s deep accumulation in the smart grid chip niche and its expansion into new business areas provide it with the potential for value reassessment.
With the impending implementation of the IR46 standard and breakthroughs in new fields such as BMS chips and automotive-grade chips, Juchuan Technology is expected to reach a performance inflection point in 2026-2027. For long-term investors, the current valuation level of the company reflects some pessimistic expectations, leaving room for marginal improvement in the future.
Disclaimer: This article is based solely on publicly available information and does not constitute any investment advice. The stock market carries risks, and investment should be approached with caution. The industry development trends and company prospects mentioned in the text are compiled from public materials and contain uncertainties; readers should make independent judgments and bear investment risks.