In-depth Analysis of Hunan Yonon's Industry Competitiveness

Hunan Yonon (stock code: 301358.SZ) is a leading enterprise in the lithium iron phosphate cathode material field. According to data from the China Chemical and Physical Power Industry Association, together with seven other leading enterprises including Desay Nano and Wanrun New Energy, it accounts for 74% of the industry’s market share [1]. The company’s products are mainly used in new energy vehicle power batteries and energy storage batteries, and it is a core supplier in the lithium iron phosphate battery industry chain.

According to publicly disclosed data, Hunan Yonon has experienced significant performance fluctuations over the past three years:

Year	Operating Revenue (100 million yuan)	YoY Change	Non-net Profit (100 million yuan)	Gross Margin
2022	427.90	-	30.33	12.47%
2023	413.58	-3.35%	15.18	Decrease
2024	225.99	-45.35%	5.70	7.63%

The statement about a 6.43% YoY decline in revenue in the first three quarters of 2025 needs to be understood in the context of the industry cycle. According to the Cost Research Report on the Lithium Iron Phosphate Material Industry released by the China Chemical and Physical Power Industry Association, only 16.7% of enterprises in the industry were profitable in 2025, far lower than other core lithium battery materials such as ternary cathodes and anodes [2]. Against this background, the revenue decline is mainly due to:

1. Sharp fluctuations in lithium carbonate prices
   : From a high of 560,000 yuan/ton in 2022 to the range of 70,000-80,000 yuan/ton in March 2025, product pricing decreased synchronously with raw material costs [3]
2. Industry overcapacity
   : The capacity utilization rate of the phosphate cathode material industry dropped from over 90% in 2021 to 55% in 2024
3. Product structure upgrade
   : The proportion of high-end products such as high-density lithium iron phosphate increased, driving the reshaping of product average prices

From the perspective of DuPont Analysis, ROE = Net Profit Margin × Asset Turnover × Equity Multiplier. The change in Hunan Yonon’s ROE reflects the impact of the industry cycle on profitability:

• Net profit margin under continuous pressure
  : From 2022 to 2024, non-net profit dropped from 3.033 billion yuan to 570 million yuan, a decrease of 81.2%
• Asset turnover efficiency
  : The inventory turnover days in 2024 were 35.64 days, consistently lower than the industry average, indicating strong operational management capabilities
• Equity structure
  : The company optimized its capital structure through private placement and other methods. The balance of construction in progress in 2024 was 1.225 billion yuan, an increase of 80% over the previous year, mainly for the expansion projects of Yunnan and Guizhou bases [3]

Gross margin is a core indicator for evaluating the competitiveness of lithium iron phosphate enterprises. According to测算 data from Fubao Information:

Time Node	Industry Average Gross Margin	Hunan Yonon’s Performance
H1 2025	0.93%	Remained Profitable
End of Nov 2025	0.4%	Achieved Profit
2024	-	Higher than Industry Average

Hunan Yonon’s gross margin advantages are mainly reflected in the following aspects:

• The provision for inventory impairment was only 0.99% (at the end of 2024), significantly lower than the provision ratio of over 10% for enterprises such as Desay Nano and Wanrun New Energy [3]
• The proportion of inventory with a storage period of less than 1 year was 95.30%, and the gross margin of post-period sales was positive
• Inventory turnover efficiency is better than the industry average of 35.64 days

• High-density lithium iron phosphate products (such as CN-5 series) have high technical barriers, and currently only a few enterprises have stable mass production capabilities
• The company’s related capacity has achieved large-scale delivery, and orders are scheduled until the first half of 2026
• Revenue in Q1 2025 increased by 49.60% YoY, mainly benefiting from the爆发 of demand for high-density products [3]

According to industry data, from 2023 to the third quarter of 2025, five leading lithium iron phosphate listed companies including Desay Nano, Wanrun New Energy, Anda Technology, Fengyuan Co., Ltd., and Longpan Technology accumulated losses of over 10.9 billion yuan [2]. Hunan Yonon is one of the only three enterprises that made profits in the first three quarters (Fulin Precision, Hunan Yonon, and Beijing Easpring Material Technology), demonstrating its operational resilience during the industry downturn.

1. Stable market share
   : As an industry leader, it has significant advantages in customer resources of downstream battery enterprises. Although customer concentration is high, it is in line with industry characteristics
2. Technology upgrade layout
   : The private placement plans to raise no more than 4.8 billion yuan, investing in projects such as annual production of 320,000 tons of lithium manganese iron phosphate and 75,000 tons of ultra-long cycle lithium iron phosphate. The first phase of 160,000 tons of capacity has been put into production [3]
3. Leading capacity utilization rate
   : The monthly capacity utilization rate in Q3 2025 reached 73.46%, and the capacity utilization rate so far this year has exceeded 100%
4. Outstanding inventory management capabilities
   : Inventory turnover efficiency is better than peers, and impairment risk control is good

1. Industry cycle pressure
   : The entire industry has been in continuous loss for more than 36 months, and the average asset-liability ratio of 6 listed enterprises is as high as 67.81%
2. Fierce price competition
   : From the end of 2022 to August 2025, the price of lithium iron phosphate material plummeted from 173,000 yuan/ton to 34,000 yuan/ton, a decrease of 80.2%
3. Lagging cost transmission
   : There is a time lag in the transmission of raw material price increases to downstream, and enterprises’ short-term profits are under pressure

According to the analysis of CITIC Construction Investment Securities, the performance decline of Hunan Yonon is due to the industry cycle, and the relevant adverse factors are not persistent. The company has significant advantages in technology research and development, customer resources, and cost control [3]. In November 2025, the company clearly stated that the processing fees for all lithium iron phosphate product lines will be increased by 3,000 yuan/ton (excluding tax) on the existing basis. Combined with the formation of industry consensus on “anti-involution”, profitability is expected to gradually recover.

From the perspective of the two core financial indicators of ROE and gross margin, Hunan Yonon has shown strong risk resistance and cost control advantages during the industry downturn. With the acceleration of industry capacity clearance, the volume of high-density lithium iron phosphate products, and the advancement of price increase negotiations, the company is expected to be the first to benefit from the structural recovery of the industry.

---

[1] 新浪财经 - 磷酸铁锂涨价潮涌：需求爆发下供需重构 (https://finance.sina.com.cn/cj/2025-12-17/doc-inhcavhm7547602.shtml)

[2] 东方财富 - 呼应"反内卷" 磷酸铁锂龙头祭出"减产检修+涨价"组合拳 (https://finance.eastmoney.com/a/202512263602746260.html)

[3] 新浪财经 - 湖南裕能回应定增问询：业绩三连降因行业周期2025年Q1营收同比大增 (https://finance.sina.com.cn/stock/aigc/wenxun/2025-12-08/doc-inhacaax3737438.shtml)