Analysis of Hillhouse Capital's Heavy Investment Logic in Delica Technology

Based on the searched information, I will detailedly analyze the investment logic of Hillhouse Capital’s heavy investment in Delica.

Delica Transmission Technology (Jiangsu) Co., Ltd. mainly engages in the R&D, production and sales of high-speed heavy-duty precision gear transmission products, with its core product being

. The wind turbine main gearbox is the core component with the highest technical threshold in wind turbines, mainly used to convert the low-speed rotation of the wind wheel into the high-speed rotation required by the generator and transmit energy, directly determining the operating efficiency, reliability and service life of the wind turbine [1].

According to the prospectus, Hillhouse Capital participated in Delica’s investment through

. In the capital increase in October 2022, Beijing Hillhouse contributed 23.3333 million yuan to subscribe for 583,300 yuan of registered capital [1]. In addition, Hillhouse Capital holds an important position in Delica’s shareholder structure; other shareholders include well-known institutional investors such as Sany Heavy Energy (28% stake), Ningbo Aoyang, and Haining Huaneng [2].

Wind power is a key energy form for China to achieve its “dual-carbon” strategic goals. According to national policy plans, the proportion of non-fossil energy in total energy consumption should rise to around 20% by 2025 and around 25% by 2030 [1]. As an important part of renewable energy, wind power’s installed capacity will continue to expand, providing a solid demand foundation for the wind turbine main gearbox market.

The wind turbine main gearbox is the core component with the highest technical threshold in wind turbines, known as the “heart” of the turbine. Downstream wind turbine manufacturers are extremely selective in choosing gearbox suppliers, requiring strict verification cycles to enter the supply chain [2]. Delica has established good cooperative relationships with leading wind turbine manufacturers such as Goldwind Technology, Envision Energy, Mingyang Smart Energy, and Sany Heavy Energy, and has been awarded honors like “Best Supplier” and “Strategic Partner” multiple times [2].

In recent years, the wind power industry has undergone significant technological changes, with the most prominent trend being

. Larger turbines improve wind energy capture efficiency and effectively reduce the construction cost per kilowatt. Delica’s fundraising investment projects include an annual production of 1000 units of 8MW+ large onshore wind turbine gearboxes and an annual production of 800 units of large offshore wind turbine gearboxes [2].

Delica achieved a leapfrog growth in revenue from 1.7 billion yuan to 4.4 billion yuan in just two years [2]. According to QY Research statistics, Delica’s

in 2024 [2]. This market position fully reflects the company’s competitive strength.

Delica’s customers cover mainstream domestic and foreign wind turbine manufacturers, and Sany Heavy Energy, as the second largest shareholder (28% stake), forms a close industrial chain synergy with Delica [2]. Hillhouse Capital’s decision to invest in Delica is both a recognition of the company’s fundamentals and a strategic layout in the core links of the wind power industry chain.

Current PE/VC investments are undergoing structural transformation, and hard tech investment has entered a golden age. Factors such as national policy guidance and the state-ownedization of LPs are driving institutions to increase investment in technological innovation [3]. As a leading investment institution, Hillhouse Capital’s heavy investment in Delica reflects its long-term optimism about the core technologies of the wind power industry chain.

The logic of Hillhouse Capital’s heavy investment in Delica can be summarized as:

. As a core supplier in the midstream of the wind power industry chain, Delica has become a strategic investment target for Hillhouse Capital’s layout in the new energy track due to its technical advantages, customer resources, and market position.

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[1] Shanghai Stock Exchange - Prospectus of Delica Transmission Technology (Jiangsu) Co., Ltd. (https://static.sse.com.cn/stock/disclosure/announcement/c/202507/002061_20250724_OR2S.pdf)
[2] Sina Finance - Revenue soared from 1.7 billion to 4.4 billion yuan in 2 years! Hillhouse’s heavy investment—why is this wind power small factory so fierce? (https://cj.sina.cn/articles/view/5557080256/14b3a50c000101f20a)
[3] Securities Times - State-ownedization of LPs, exit meets registration system—how do two major variables reshape the PE/VC industry? (https://www.stcn.com/article/detail/843332.html)