Management Capability Assessment Report of Rongbai Technology (688005.SH)

Based on information collected from multiple channels, I have prepared a systematic assessment report on the management capability of

.

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Rongbai Technology has an

, with core members boasting profound industry experience and rich technical backgrounds in the lithium battery cathode materials sector[1].

Name	Position	Core Background
Bai Houshan	Chairman	Graduated from Central South University majoring in Nonferrous Metallurgy, with an MBA from Tsinghua University; served as Director and General Manager of Beijing Easpring Material Technology Co., Ltd. (2001-2012); a senior technical expert and entrepreneur in China’s lithium battery materials industry; serves as a director of China Electric Vehicle 100, a director of China Chemical and Physical Power Sources Industry Association, and a review expert for the National Science and Technology Award
Liu Xianglie (Yoo Sang-yul)	Vice Chairman, General Manager, and Dean of Research Institute	Graduated from the Graduate School of Physics, Hanyang University, South Korea; has over 30 years of industry experience; served as a researcher at Samsung SDI Comprehensive Research Institute and Head of Material and Pharmaceutical Manufacturing at Samsung SDI; served as General Manager of the Lithium Battery Cathode Materials Division of South Korea’s L&F (2005-2009); founded EMT Co., Ltd. in 2010 and served as Chairman and General Manager
Zhang Huiqing	Director and Deputy General Manager	Graduated from Beijing University of Chemical Technology; served as Deputy General Manager and Production Director of Easpring Material Technology in 2012; has served as Director and Deputy General Manager of the company since 2014
Lee Chong-hee	Deputy Dean of Research Institute	Doctor of Engineering in Applied Chemistry from Kyushu University, Japan; served as Senior Engineer at Samsung SDI Battery Development Center; Chief Engineer at the Battery Materials Research Center of GS Energy Corporation; an internationally leading technical talent, participated in multiple national R&D projects in South Korea
Sun Baoguo	Deputy Dean of Research Institute	PhD in Chemistry from the University of Tasmania; recipient of the U.S. Presidential Green Chemistry Challenge Award (2012)

The core advantage of Rongbai Technology’s management team lies in its

[2]:

• The entrepreneurial team has been deeply engaged in the cathode materials sector for over 20 years
  , with most members holding master’s or doctoral degrees, and strong technical genes
• Most core technical personnel have years of
  management and technical experience
  in lithium battery cathode materials
• Chairman Bai Houshan
  , as a senior technical expert in China’s lithium battery materials industry, successfully led the development of Easpring Material Technology, and has
  rich entrepreneurial experience and industry accumulation
• General Manager Liu Xianglie (Yoo Sang-yul)
  , as a South Korean lithium battery materials expert, has brought
  international vision and technical resources
  to the company
• The management can
  easily access cutting-edge information
  , which facilitates the integration of production and R&D, and early layout for new product development

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The management of Rongbai Technology has formulated a

[3]:

Development Stage	Strategic Goal
2021	Enter the top two new energy materials enterprises in the world
2023	Become the world’s top integrated new energy materials enterprise
2028	Become a globally leading new energy enterprise cluster

The company’s strategic positioning is

, focusing on the full-life-cycle services of new energy materials, covering four core areas: [4].

The management demonstrates the following characteristics in strategic execution:

• In 2016
  , took the lead in breaking through and mastering the key process technologies of high-nickel ternary cathode materials
• In 2017
  , became the first domestic cathode materials enterprise to achieve large-scale mass production of high-nickel NCM811
• In 2019
  , completed the development of Ni90 high-nickel cathode materials, with technology significantly leading peers
• In 2024
  , sales of ternary materials increased by 20% year-on-year, far exceeding the industry growth rate, and ranked first in global ternary materials market share for four consecutive years[5]

• Lithium Manganese Iron Phosphate (LMFP)
  : Took the lead in achieving 10,000-ton production capacity, with shipments increasing by over 100% year-on-year in 2024, and ranked first in the industry’s market share for two consecutive years[5]
• Sodium-ion Battery Cathode Materials
  : Secured thousands of tons of orders from top customers, with annual shipments leading the industry
• Solid-state Battery Materials
  : Actively lays out sulfide electrolytes, promoting the application of ultra-high-nickel cathode materials in the solid-state battery field

• Overseas sales exceeded 20,000 tons in 2024
• Established offices and production bases in overseas regions such as North America, Europe, and Southeast Asia
• Completed the acquisition of the Polish plant of Britain’s Johnson Matthey, and started the construction of the first-phase 20,000-ton project
• The South Korean plant obtained certification from Japanese customers and started mass production[6]

The management continues to promote strategic upgrading in 2024-2025[7]:

• “New Integration” Strategy
  : Connect the entire industrial chain from resources to products, and build a global supply chain that meets the requirements of international battery regulations
• “Digital Intelligence” Strategy
  : Deeply integrate informatization, digitalization and intelligent technologies, and build Rongbai’s own vertical AI large model
• Organizational Structure Optimization
  : Build a flat three-level structure from the Chairman to the Future Strategy Office to entity enterprises, and implement the “3P” (Position, Pay, Performance) incentive mechanism and four-level partner mechanism

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The management of Rongbai Technology attaches great importance to R&D and innovation[8]:

Indicator	Performance
R&D Expenditure	RMB 120 million and RMB 165 million in 2018 and 2019 respectively
R&D Personnel Ratio	Approximately 15.1% (304/2015 employees)
Ratio of Master’s and Doctoral Degree Holders	Approximately 11% (122 master’s, 13 doctoral)
Core Technologies	Seven core technologies covering precursors, cathode material sintering, modification processes, and metal recycling

• The company has
  82 independently developed patents
• Was awarded the 3-level certification of ISO 56005 “Innovation and Intellectual Property Management Capability”, becoming the 4th enterprise in China and the first in Zhejiang Province to obtain this certification
• Has obtained the “Enterprise Intellectual Property Compliance Management System GB/T29490” certification for consecutive years
• Has abundant high-nickel technology reserves, with the progress of products under development leading the industry by 1-2 years

The management has built a

[9]:

• The Beijing R&D Center is responsible for tracking and researching cutting-edge technologies
• The South Korean R&D team maintains close ties with the Japanese and South Korean industrial chains
• Lee Chong-hee, Deputy Dean of the Research Institute, once served as Senior Engineer at Samsung SDI Battery Development Center
• Sun Baoguo, Deputy Dean of the Research Institute, is the recipient of the U.S. Presidential Green Chemistry Challenge Award

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Year	Operating Revenue (in 100 million RMB)	Net Profit Attributable to Shareholders (in 100 million RMB)	Year-on-Year Growth Rate
2021	Approximately 102.6	9.11	-
2022	Approximately 200-300	-	-
2023	226.57	5.81	-57.07%
2024	150.88	2.96	-49.06%

Facing the performance decline in 2024 (operating revenue decreased by 33.41% year-on-year, net profit decreased by 49.06% year-on-year), the management demonstrated

[10]:

1. Proactively adopted market competition strategies
   : Addressed challenges such as intensified domestic market competition and raw material price fluctuations
2. Continuously promoted operational improvement
   : Net profit attributable to shareholders achieved quarter-on-quarter growth in each quarter, and total profit and profitability per ton continued to improve
3. Cash Flow from Operating Activities
   : Achieved a net cash inflow of RMB 523 million in 2024, with a healthy cash flow status
4. Gross Margin Improvement
   : Through refined operation management of raw materials and reduction of manufacturing costs, the gross margin in Q2 increased by 5.7 percentage points month-on-month to 10.8%

The management demonstrated

[11]:

• Rapidly laid out lithium iron phosphate
  : Plans to acquire Guizhou Xinren for RMB 482 million in December 2025 to obtain a 60,000-ton lithium iron phosphate production capacity
• Signed a RMB 120 billion long-term order with CATL
  : Expected to supply approximately 3.05 million tons of lithium iron phosphate cathode materials from 2026 to 2031
• Adjusted strategic focus
  : Adopted a diversified business layout, actively developing sodium-ion batteries, lithium manganese iron phosphate and other routes in addition to high-nickel ternary materials

Note

: This strategic agreement has triggered an inquiry from the Shanghai Stock Exchange, requiring the company to disclose its performance capability and delivery plan[11].

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The management of Rongbai Technology attaches great importance to

[12]:

Incentive Plan	Time	Content
First Phase Equity Incentive	November-December 2016	Employees obtained indirect equity by participating in equity auctions with their own funds
Second Phase Equity Incentive	May 2017	Employee stock ownership platforms Rongke Partnership and Rongcheng Partnership subscribed for RMB 5.651 million of registered capital
Third Phase Equity Incentive	December 2020	Granted 12.75 million shares (accounting for 2.88% of the total share capital), covering 200 employees (10% of the total number of employees)

The third phase equity incentive set

[12]:

Vesting Period	Net Profit Attributable to Shareholders Target	Market Value Target (Arithmetic Average for 20 Consecutive Days)
2021	RMB 350 million	RMB 26 billion
2022	RMB 550 million	RMB 40 billion
2023	RMB 700 million	RMB 50 billion

• Through equity incentives, the company established and improved its incentive mechanism
• Fully mobilized the work enthusiasm of the company’s middle and senior management and backbone personnel
• The core members of the management team have high stability, and Chairman Bai Houshan has been in office since 2015
• Adopted a global talent layout, and continued to promote overseas human resource development

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Rongbai Technology has established a relatively sound

[13]:

• Operates in strict accordance with the requirements of laws and regulations such as the Company Law, Securities Law, Code of Corporate Governance for Listed Companies, and the Shanghai Stock Exchange’s Self-Regulatory Guidelines for STAR Market Listed Companies No. 1 - Standard Operation
• Held 11 board meetings, 6 supervisory board meetings, and 2 general meetings of shareholders in 2024
• Established the Future Strategy Office to strengthen strategic decoding and industrial investment capabilities

The management has integrated the

[4]:

• Released documents such as the Carbon Management Manual and Organizational-level Carbon Inventory Operation Specifications
• The organizational-level carbon emission intensity in 2024 decreased by 8.2% overall compared with 2023
• Hubei Rongbai and Guizhou Rongbai were selected as “National Green Factories”
• The Wind ESG rating was upgraded to
  Grade A
  for the first time

The management demonstrates the following characteristics in risk response:

Risk Type	Response Measures
Transformation Risk	Strengthen market research, and actively develop green and low-carbon products according to trends
Reputational Risk	Strengthen communication with stakeholders, and maintain information openness and transparency
Supply Chain Risk	Build a global supply chain that meets the requirements of international battery regulations
Raw Material Price Risk	Implement refined operation management of raw materials, and adopt strategies such as hedging

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Rongbai Technology occupies a

in the cathode materials sector[5]:

Indicator	Performance
Global Ternary Materials Market Share	Over 12%, ranking first globally for four consecutive years
Domestic High-nickel Ternary Materials Market Share	Approximately 40% (first half of 2024)
High-nickel Product Technology	Leading technology for series 9 products, with sales of 12,000 tons in the first half of 2024

The company’s management has formulated a

, with customers covering mainstream lithium battery manufacturers at home and abroad[2]:

• Domestic Customers
  : CATL (top customer), BYD, Funeng Technology, Lishen, BAK Power, etc.
• International Customers
  : LG Chem, Samsung SDI, SK, etc.
• New Customer Development
  : Developed 57 new international customers in Japan, South Korea, Europe and North America in 2024

The management demonstrates

:

• Made substantial progress in overseas customer development, with existing customers achieving monthly shipments ranging from hundreds to thousands of tons
• The South Korean plant obtained certification from Japanese customers and was officially integrated into the supply chain of well-known Japanese and South Korean battery enterprises
• Signed a strategic cooperation agreement with CATL to lock in long-term orders

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Assessment Dimension	Score	Explanation
Technological R&D Capability	★★★★★	Top Chinese and South Korean R&D team, leading core technologies, and sound patent layout
Strategic Planning Capability	★★★★☆	Clear strategic goals, and the “New Integration” and “Digital Intelligence” strategies are forward-looking
Strategic Execution Capability	★★★★☆	Leading industrialization of high-nickel technology, and steady advancement of global layout
International Vision	★★★★★	Integration of Chinese and South Korean teams, and leading overseas production capacity layout in the industry
Talent Incentive Capability	★★★★☆	Three phases of equity incentives covering core backbone personnel, with good team stability
Risk Response Capability	★★★★☆	Adopted proactive measures in response to industry fluctuations, with gradually improving financial performance
Corporate Governance Capability	★★★★☆	Sound governance structure, and good ESG performance
Innovation Capability	★★★★★	Continuous increase in R&D investment, and fast product iteration speed

1. Rich industry experience of the founding team
   : Both Bai Houshan and Liu Xianglie (Yoo Sang-yul) are senior experts in the lithium battery cathode materials sector
2. Technical advantage of China-South Korea collaboration
   : Can quickly access cutting-edge technical information from Japan and South Korea
3. First-mover advantage in high-nickel technology
   : The first domestic enterprise to achieve large-scale mass production of NCM811
4. Leading global layout
   : The construction speed of overseas production capacity leads competitors
5. Sound talent incentive mechanism
   : Equity incentive plans effectively bind core talents

1. Performance pressure
   : Both operating revenue and net profit declined in 2024, with intensified market competition
2. Layout of new technology routes
   : As a “latecomer” in the lithium iron phosphate sector, it needs to catch up
3. Performance capability for large orders
   : The RMB 120 billion long-term order with CATL faces an inquiry from the Shanghai Stock Exchange[11]
4. Industry cyclical fluctuations
   : Cyclical fluctuations in the new energy lithium battery industry have a significant impact on performance

, with obvious core advantages:

• The management demonstrates outstanding capabilities in
  technological R&D
  and
  global layout
• Through the “New Integration” and “Digital Intelligence” strategies, it promotes the company’s transformation and upgrading to a “total solution provider for the cathode materials industry”
• The equity incentive mechanism effectively ensures the stability of core talents
• Despite facing challenges such as industry cyclical fluctuations and intensified competition, the management demonstrates strong risk response capabilities

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[1] Gelonghui - Rongbai Technology (688005)/Domestic Leader in High-nickel Cathode Materials for New Energy Vehicles (https://img3.gelonghui.com/pdf/38fbe-b964bac1-52a3-4504-bc3e-51f1654ca2aa.pdf)
[2] Debon Securities - Rongbai Technology (688005.SH): The Rise of the High-nickel Cathode Leader (https://pdf.dfcfw.com/pdf/H3_AP202105261494124911_1.pdf)
[3] Prospectus - Ningbo Rongbai New Energy Technology Co., Ltd. Initial Public Offering and Listing on the STAR Market (http://static.sse.com.cn/stock/disclosure/announcement/c/201906/000008_20190610_FJR4.pdf)
[4] Shanghai Stock Exchange - Rongbai Technology 2024 Environmental, Social and Governance Report (https://star.sse.com.cn/disclosure/listedinfo/announcement/c/new/2025-04-10/688005_20250410_IAOK.pdf)
[5] Securities Times - Rongbai Technology Ranks First in Global Ternary Materials Market Share for Four Consecutive Years (https://www.stcn.com/article/detail/1653337.html)
[6] Pacific Securities - Rongbai Technology 2024 Half-year Report Performance Review (https://pdf.dfcfw.com/pdf/H3_AP202408221639407152_1.pdf)
[7] Sina Finance - Rongbai Technology 2024 Annual Report (http://money.finance.sina.com.cn/corp/view/vCB_AllBulletinDetail.php?stockid=688005&id=10858685)
[8] Soochow Securities - Rongbai Technology (688005) Locks in Key Customers and Values R&D, Forging a Global High-nickel Leader (https://pdf.dfcfw.com/pdf/H3_AP202012241443601861_1.pdf)
[9] Sina Finance - Rongbai Technology Senior Management (https://vip.stock.finance.sina.com.cn/corp/view/vCI_CorpManagerInfo.php?stockid=688005)
[10] Eastmoney - Rongbai Technology Achieves Net Profit of RMB 296 Million in 2024 (https://wap.eastmoney.com/a/202504103372872518.html)
[11] EET China - Rongbai Technology’s “100 Billion RMB Long-term Order” Faces Inquiry, with Delivery Capability Focused on (https://www.eet-china.com/mp/a467366.html)
[12] NIO Capital - Congratulations to Rongbai Technology, a NIO Capital Portfolio Company, on Successfully Listing on the STAR Market (https://www.niocapital.com/news/133.html)
[13] Sina Finance - Ningbo Rongbai New Energy Technology Co., Ltd. Investor Relations Activity Record (https://pdf.dfcfw.com/pdf/H2_AN202308111594147327_1.pdf)