Analysis Report on Changes in Accounts Receivable Turnover Days of SUPCON Technology (688777.SS)

Based on the collected data, let me present a complete analysis report on changes in SUPCON Technology’s accounts receivable turnover days.

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(Zhejiang SUPCON Technology Co., Ltd.) is an enterprise focusing on industrial automation control systems, listed on the Shanghai STAR Market [0]. As a representative enterprise in the field of industrial automation equipment manufacturing, the efficiency of its accounts receivable management has a significant impact on the company’s cash flow and operational quality.

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Based on the financial data obtained from Jinling AI [0], the changes in SUPCON Technology’s accounts receivable turnover days over the past 8 quarters are as follows:

Reporting Period	DSO (Days)	Turnover Rate (Times)	Average Accounts Receivable (RMB 100 million)
2022Q4	126.5	0.71	3.25
2023Q1	222.1	0.41	3.47
2023Q2	166.7	0.54	3.82
2023Q3	188.1	0.48	4.16
2023Q4	126.2	0.71	4.19
2024Q1	224.2	0.40	4.23
2024Q2	163.5	0.55	4.45
2024Q3	202.5	0.44	4.63
2024Q4	166.6	0.54	4.94
2025Q1	292.1	0.31	5.20
2025Q2	220.4	0.41	5.33
2025Q3	284.0	0.32	5.60

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Year	Average DSO (Days)	YoY Change
2022	126.5	Benchmark
2023	175.8	+38.9%
2024	189.2	+7.6%
2025 (YTD)	265.5	+40.3%

• SUPCON Technology’s annual average DSO shows a continuous deteriorating trend
• From 2022 to 2025, DSO has accumulated a growth of approximately 110%
• The deterioration rate accelerated significantly in 2025

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According to industry research data [1][2]:

Industry/Enterprise Type	Average DSO (Days)
Industrial Automation Industry Average	60-90
Manufacturing (Equipment Category) Average	~103
Central Enterprise Average	97
Overall Industrial Enterprise Average	~70
SUPCON Technology (2025Q3)	284.0

SUPCON Technology’s DSO (284 days) is the average level of the industrial automation industry, far exceeding the reasonable industry range, indicating significant problems in its accounts receivable collection efficiency [0].

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Risk Indicator	Assessment Result
DSO Level	⚠️ Extremely High (exceeding the 120-day warning line)
Deviation from Historical Average	+43.0%
QoQ Change	+63.5 days
Scale of Accounts Receivable	Continuous Growth (+26.2% higher than historical average)

According to search results [1], excessively long accounts receivable turnover days will have the following impacts on the enterprise:

• Increased Capital Occupancy Cost
  : The amount of accounts receivable increased from RMB 325 million in 2022 to RMB 560 million in 2025, a growth of 72.3%
• Increased Bad Debt Risk
  : According to research data from the Ministry of Finance, the bad debt loss rate of enterprises with DSO exceeding 180 days increases significantly
• Operating Cash Flow Pressure
  : The company’s Q3 2025 financial report shows poor operating cash flow performance [0]

Based on the searched industry analysis [1][2]:

• Industrial automation sub-sectors such as the machine tool industry are facing overall pressure of extended payment terms
• The industry’s accounts receivable turnover days increased from approximately 100 days in 2024 to a higher level in 2025
• Intensified price competition has led to narrowed profit margins, further affecting the ability to collect payments

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• Macroeconomic Pressure
  : The overall accounts receivable collection period of industrial enterprises has increased. As of the end of November 2025, the average accounts receivable collection period of industrial enterprises above the designated size was 70.4 days, an increase of 3.7 days year-on-year [1]
• Intensified Industry Competition
  : Price wars have led to enhanced customer bargaining power, resulting in passively extended payment terms
• Tight Capital of Downstream Customers
  : The payment cycles of large customers have generally been extended

• Changes in Customer Structure
  : It is possible that more large project-type customers have been added, and such customers usually have longer payment terms
• Credit Management Policy
  : There may be overly loose credit policies
• Account Collection Efficiency
  : The ability to manage payment collection needs to be improved

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• ⚠️
  High Accounts Receivable Risk
  : DSO is as high as 284 days, far exceeding the industry average
• ⚠️
  Cash Flow Pressure
  : The scale of accounts receivable continues to grow, and collection efficiency is declining
• ⚠️
  Bad Debt Provision Pressure
  : The increase in long-term accounts receivable may affect future profits

• Whether DSO improves in subsequent quarters
• Changes in the age structure of accounts receivable
• Status of bad debt provision
• Changes in operating cash flow

According to financial analysis [0], the company’s current P/E ratio is 60.80 times, which is at a relatively high level. The decline in accounts receivable management efficiency may pressure the valuation, and it is recommended to continue paying attention to the improvement of working capital management.

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SUPCON Technology’s accounts receivable turnover days show a

trend, rising from 126.5 days in 2022 to 284 days in the third quarter of 2025, representing a 124.5% increase [0]. This phenomenon reflects the following:

1. Significant decline in accounts receivable collection efficiency
   : DSO is more than 3 times the industry average
2. Increased capital occupancy cost
   : The scale of accounts receivable increased from RMB 325 million to RMB 560 million
3. Increased pressure on cash flow management
   : Poses challenges to the company’s operational quality and financial health

It is recommended that investors pay close attention to the company’s subsequent improvement measures in accounts receivable management, as well as the improvement of working capital efficiency.

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[0] Jinling AI Financial Database - Financial Indicators and Key Data of SUPCON Technology (688777.SS)
[1] National Bureau of Statistics - Profit and Accounts Receivable Data of Industrial Enterprises in the First 11 Months of 2025 (http://cjckcn.com/mj/27670.html)
[2] Soochow Securities Research Report - Summary of 2024 Annual Report & 2025 Q1 Report for General Automation (https://pdf.dfcfw.com/pdf/H3_AP202505071669076755_1.pdf)