Breaking Down Zhejiang Yinlun Machinery Co.,Ltd. Financial Health: Key Insights for Investors

Dive into a data-rich breakdown of Zhejiang Yinlun Machinery Co., Ltd. where the numbers tell a compelling story: trailing twelve months revenue stood at CNY 14.55 billion (TTM) as of Sept 30, 2025, annual 2024 revenue was CNY 12.70 billion (+15.28% YoY) and Q1 2025 revenue hit CNY 3.42 billion (+15.05% YoY), while analysts forecast revenue reaching CNY 15.7 billion in 2025 and market capitalization surged to CNY 29.03 billion by Dec 10, 2025 (an 80.89% increase); profit metrics through Q3 2025 show net profit attributable of CNY 672 million (+11.18% YoY), EPS of CNY 0.81, ROE of 13.53%, gross margin 19.3% and operating margin ~6.5%, supported by cash and equivalents of CNY 2.24 billion (+33% YoY), operating cash flow of CNY 1.2 billion and free cash flow ratio 74.51, against a moderate leverage profile (debt/equity 0.54, long-term debt CNY 1.2 billion, debt/EBITDA 2.43) and liquidity indicators (current ratio 1.17, quick ratio 0.94); valuation multiples as of Dec 10, 2025 include P/E 34.79, P/B 4.43, EV/EBITDA 21.06 and P/S 1.85, while risks such as raw material exposure (aluminum ~60% of production cost), regulatory shifts (Euro 7), and competitive/geo-political challenges contrast with growth levers like NEV thermal solutions, a USD 61.3 million North American EV radiator contract, R&D at ~5% of revenue, and expansion into Poland and Mexico-read on for the full chapter-by-chapter financial deep dive and what these figures mean for investors.

Zhejiang Yinlun Machinery Co.,Ltd. (002126.SZ) - Revenue Analysis

• TTM revenue (as of 2025-09-30): CNY 14.55 billion - +19.00% YoY
• Annual revenue 2024: CNY 12.70 billion - +15.28% YoY vs. 2023
• Q1 2025 revenue: CNY 3.42 billion - +15.05% YoY vs. Q1 2024
• Analyst consensus for 2025: CNY 15.70 billion - implied +23% vs. 2024
• Market capitalization (2025-12-10): CNY 29.03 billion - +80.89% YoY
• Revenue per employee: CNY 1.39 million; workforce: 10,494 employees

• Sales growth appears broad-based, with sequential quarterly strength (Q1 2025 +15.05% YoY) supporting the TTM gain.
• Analyst projection to CNY 15.70 billion in 2025 implies continued demand and potential upside if execution remains on track.
• Strong market-cap appreciation (80.89% YoY) signals investor re-rating, likely reflecting both revenue growth and margin/earnings improvements priced in by the market.

Zhejiang Yinlun Machinery Co.,Ltd. (002126.SZ) - Profitability Metrics

• Net profit attributable to shareholders (Q1-Q3 2025): CNY 672 million, up 11.18% YoY.
• Net profit margin (Q1-Q3 2025): ~4.8%, reflecting improved cost management versus prior periods.
• Earnings per share (EPS, 9 months to Sep 30, 2025): CNY 0.81, vs. CNY 0.74 in the same period prior year.
• Return on equity (ROE): 13.53%, indicating efficient use of shareholders' equity.
• Gross margin (as of Jul 5, 2025): 19.3%, showing retained pricing power and production cost control.
• Operating profit margin: ~6.5%, underscoring healthy operational efficiency.

• Cost management: Gross margin of 19.3% and net margin of ~4.8% indicate effective input-cost control and disciplined pricing.
• Operational leverage: Operating margin (~6.5%) converted higher revenue into improved EBIT and net profit growth of 11.18% Y/Y.
• Shareholder returns: EPS growth to CNY 0.81 and ROE of 13.53% signal rising per-share earnings and capital efficiency.

Zhejiang Yinlun Machinery Co.,Ltd. (002126.SZ) - Debt vs. Equity Structure

• Debt-to-equity ratio (Q2 2023): 0.54 - indicates moderate leverage relative to equity base.
• Long-term debt (Q2 2023): CNY 1.2 billion; short-term debt: CNY 500 million - total reported debt CNY 1.7 billion at that date.
• Current ratio: 1.17 - suggests adequate short-term financial stability to meet near-term obligations.
• Interest coverage ratio: 9.60 - strong ability to service interest expenses from operating earnings.
• Share buyback (May 7, 2025): repurchased 3,986,500 shares (0.48% of outstanding) for CNY 100 million - an equity-reducing move that modestly increases leverage metrics post-buyback.
• Enterprise value (Dec 10, 2025): CNY 30.72 billion - provides context for market valuation vs. reported debt levels.

• The majority of reported debt is long-term (CNY 1.2B vs CNY 0.5B short-term), which reduces immediate refinancing pressure.
• A debt/equity ratio of 0.54 combined with an interest coverage of 9.60 signals manageable leverage and comfortable interest servicing from operating profits.
• The current ratio of 1.17 implies working capital is adequate but not excessively conservative - liquidity cushions exist but warrant monitoring.
• The May 2025 buyback (CNY 100M) reduced equity and cash reserves, modestly increasing net leverage; analysts should recalibrate post-buyback ratios when assessing capital structure.
• EV of CNY 30.72B places the CNY 1.7B debt as a small component of total enterprise value, indicating market capitalization and/or minority liabilities dominate overall valuation.

Zhejiang Yinlun Machinery Co.,Ltd. (002126.SZ) - Liquidity and Solvency

• Cash and cash equivalents: CNY 2.24 billion (up 33% year-over-year as of 2025-09-30).
• Quick ratio: 0.94 - below 1.0, indicating potential difficulty meeting near-term liabilities without selling inventory.
• Operating cash flow (first three quarters 2025): CNY 1.2 billion - a meaningful contributor to near-term liquidity.
• Net working capital: CNY 1.5 billion - positive working capital supporting short-term operations.
• Debt-to-EBITDA: 2.43 - moderate leverage relative to earnings, suggesting manageable debt service under normal operating conditions.
• Free cash flow (FCF) ratio: 74.51 - indicating strong cash generation relative to enterprise value.

Zhejiang Yinlun Machinery Co.,Ltd. (002126.SZ) Valuation Analysis

• P/E ratio: 34.79 - materially above the broader Chinese market average, signaling high investor willingness to pay for current earnings.
• P/B ratio: 4.43 - indicates the market prices the company at a significant premium to its book value.
• EV/EBITDA: 21.06 - reflects elevated expectations for future cash‑profitability growth versus peers.
• P/S ratio: 1.85 - suggests revenue is being monetized at a reasonable multiple compared with earnings and balance‑sheet multiples.
• Market cap change (1y): +80.89% - strong share-price appreciation consistent with rising investor confidence.
• PEG ratio: Not available - limits direct comparison of valuation versus expected earnings growth rates.

Zhejiang Yinlun Machinery Co.,Ltd. (002126.SZ) - Risk Factors

• Global demand sensitivity: A 1% decline in global automotive production can translate into a multi-percent revenue hit given the company's cyclical end-markets (automotive, construction machinery). Historically, cyclical troughs have seen order books fall 15-30% year-over-year in severe downturns.
• Raw material price exposure: Aluminum and alloy inputs account for roughly 60% of Zhejiang Yinlun's direct production costs. A sustained 10% rise in aluminum prices can compress gross margins by ~6 percentage points unless offset by price pass-through or hedging.
• Regulatory & standards risk: Evolving emission and thermal-management regulations (e.g., Euro 7 and equivalents in export markets) can shift component specifications and lifetime requirements, potentially reducing demand for legacy products and increasing retrofit/recall risks.
• Competitive pressures: Domestic OEMs and international thermal-management suppliers exert pricing and innovation pressure. Market-share shifts can be rapid where scale or technological lead exists.
• Geopolitical and trade-policy risk: Export-oriented expansion exposes the company to tariffs, export controls and supply-chain re-routing. An adverse trade-policy action in key markets could reduce export revenue by an estimated 20-35% in high-impact scenarios.
• Technological disruption and R&D needs: Maintaining competitiveness requires continuous R&D. Zhejiang Yinlun's R&D spend sits in the low single digits of revenue (approximately 2-3% historically); insufficient investment risks product obsolescence.

• Liquidity and balance-sheet risks: Interest-rate moves and working-capital swings during order cycles can strain liquidity; maintaining a conservative net debt/EBITDA target and adequate credit lines is critical.
• Supply-chain concentration: Single-supplier or region-concentrated sources for critical alloys elevate operational risk; dual-sourcing and inventory strategies reduce disruption probability.
• Execution risk in new markets: Rapid expansion increases capex and working-capital needs; mis-timed investments can dilute returns and increase leverage.

Zhejiang Yinlun Machinery Co.,Ltd. (002126.SZ) - Growth Opportunities

• NEV thermal management: core product mix aligned with accelerating EV adoption and stricter thermal design needs for battery and powertrain systems.
• International expansion: manufacturing and sales presence in Poland and Mexico provide access to European and North American OEMs and localized supply chains.
• Large OEM contract: confirmed supply contract for radiator products to a major North American automaker valued at USD 61.3 million (firm order), creating multi-year revenue visibility.
• R&D-led product diversification: R&D spending ~5% of total revenue in 2024 supports new product lines including chip liquid cooling for intelligent driving systems.
• Regulatory tailwinds: capability to meet evolving emission/efficiency standards (e.g., Euro 7) enables product upgrades and competitive differentiation.

• Chip liquid cooling: entry into data- and sensor-cooling for ADAS/compute modules opens adjacencies to tier-1 electronics suppliers and recurring BOM revenues.
• Geographic diversification effects: Poland facility shortens lead times to EU OEMs; Mexico supports nearshoring for North American automakers, reducing FX and logistics exposure.
• Product roadmap aligned with regulation: Euro 7 and similar standards increase demand for efficient thermal management systems, enabling upsell of higher-spec components.
• Revenue mix evolution: shift from commodity radiators to integrated thermal systems and cooling modules likely to improve ASPs and gross margins over time.