Shenzhen Stock Exchange:
Pursuant to the Inquiry Letter on the Application of Zhongying Electronics Co., Ltd. for Issuing Shares to Specific Objects (Inquiry Letter [2026] No. 020056) issued by your esteemed exchange on July 6, 2026, Zhongying Electronics Co., Ltd. (hereinafter referred to as "Zhongying Electronics," "the Issuer," or "the Company"), together with Huatai United Securities Co., Ltd. (hereinafter referred to as "the Sponsor" or "Huatai United Securities"), Shanghai Tongli Law Firm (hereinafter referred to as "the Issuer's legal counsel"), and China United Certified Public Accountants (Special General Partnership) (hereinafter referred to as "the Reporting Accountant"), has conducted thorough verification and implementation of the issues raised in the inquiry letter. The response is hereby submitted for your review.
Unless otherwise specified, the abbreviations or definitions in this reply have the same meaning as in the Prospectus. The font used in this inquiry letter reply represents the following:
| Item | Font |
|---|---|
| Issues listed in the inquiry letter | Bold |
| Reply to the issues listed in the inquiry letter | Songti (not bold) |
| Content involving amendments or supplements to the Prospectus | Kaiti (bold) |
The data cited in this inquiry letter reply, if the sum of the sub-items differs from the total, or if the decimal tail differs from the original data, may be due to differences in precision or rounding.
TABLE OF CONTENTS
Problem 1
Problem 2
Problem 3
Other Issues
Problem 1
The Company plans to issue shares to its controlling shareholder, Shanghai Zhineng Industrial Electronics Co., Ltd. (hereinafter referred to as "Zhineng Industrial Electronics"), to raise no more than RMB 100,000.00 million. After deducting issuance expenses, the funds will be used for the "R&D and Industrialization Project for High-end Industrial-grade (Automotive-grade) Analog and Mixed-Signal Chips" (hereinafter referred to as Project 1) and the "R&D and Industrialization Project for High-end Industrial-grade (Automotive-grade) Main Control SoC (including intelligent control)" (hereinafter referred to as Project 2), as well as to supplement working capital.
Project 1's main products are analog front-end chips for batteries, bridge chips, protection chips, and related analog and mixed-signal chips. The project's after-tax internal rate of return is 23.47%, and the after-tax static investment recovery period is 7.92 years (including the construction period). Project 2's main products are microcontrollers (MCUs) and related main control SoCs. The project's after-tax internal rate of return is 16.72%, and the after-tax static investment recovery period is 8.64 years (including the construction period).
At the end of each reporting period, the Company's asset-liability ratio was 18.66%, 21.05%, 16.22%, and 15.23%, respectively, which is lower than the average of comparable companies in the same industry. As of the end of March 2026, the Company's transactional financial assets had a book value of RMB 15,060.42 million.