Galaxy Microelectronics (688689.SH), after a half-month trading halt, resumed trading upon disclosing its restructuring plan. The company proposes to issue shares to acquire 100% equity of Hengtai Ke Semiconductor from three shareholders—Shanghai Zhineng Hengxin Industrial Electronics Co., Ltd., Gongqingcheng Mingnuo Investment Partnership (Limited Partnership), and Tianmu Yulin (Shanghai) Technology Co., Ltd.—while concurrently raising matching funds.
On the resumption day, the stock hit the '20CM' limit up, closing at 55.88 yuan per share, with a total market value rising to about 7.2 billion yuan and a turnover rate of only 1.21%. The limit-up buy orders reached 291 million shares, 185 times the day's trading volume, corresponding to over 1.5 billion yuan in funds.
Amid the high cycle of the power semiconductor industry, the market has positive expectations for Galaxy Microelectronics' acquisition to enter the medium-high voltage power semiconductor mid-to-high-end track. However, the transaction still faces multiple controversies, including insider trading suspicions triggered by abnormal stock price spikes before the halt, the yet-to-be-determined target valuation, and potential large goodwill pressure in the future.
Jiang Han, a senior researcher at Pangu Think Tank, said integration challenges mainly lie in product line and customer management. After the merger, Hengtai Ke's product count will expand from over 700 to over 1,000, increasing complexity in customer management and capacity allocation. Secondly, core technology is highly tied to the R&D team; without reasonable equity incentives and non-compete clauses, there may be risk of technology loss and goodwill impairment.
Acquisition to 'Fill Gaps': From Discrete Devices to Medium-High Voltage Power Semiconductors
Galaxy Microelectronics' acquisition of Hengtai Ke is an industry merger to fill gaps and enhance synergy. After the transaction, the company expects to fill the medium-high voltage power semiconductor technology gap, bridge the high-end product void, and improve the overall product matrix.
As a semiconductor discrete device company listed on the STAR Market in 2021, Galaxy Microelectronics has long relied on small-signal devices and low-voltage power devices as its core performance base, but has been relatively slow in high-end areas such as high-voltage MOSFET, IGBT, and silicon carbide (SiC). Disclosed technological breakthroughs have not yet translated into actual performance, affecting its penetration in high-end markets like automotive electronics.
Against the backdrop of intensifying industry competition, Hengtai Ke is seen as a key lever for Galaxy Microelectronics to break through technological bottlenecks. According to the restructuring plan, Hengtai Ke is a national-level 'Specialized, Fined, and New' 'Little Giant' enterprise, mainly engaged in R&D, development, and sales of power semiconductor products. Products are used in power supplies, lithium battery protection, brushless motors, new energy, and E-car (OBC, electronic control) fields.
Hengtai Ke possesses medium-voltage SGT MOSFET and high-voltage SuperJunction technologies. The restructuring plan indicates that in the 150V-200V range, its medium-high voltage SGT MOSFET has reached domestic top-tier level and can Pin-to-Pin benchmark and replace Infineon's medium-voltage series products.
This transaction is described as a 'Fabless design + IDM manufacturing' industry chain integration: Galaxy Microelectronics has mature chip manufacturing capacity but lacks high-end design capability; Hengtai Ke has top design technology but lacks its own production lines, long constrained by foundry capacity and cost fluctuations. There is complementarity at the business level, but whether synergy effects can be realized depends on subsequent integration.
Valuation Fog and Funding Pressure: Acquisition Consideration and Cash Flow Volatility
Risks highlighted in the plan include Hengtai Ke facing dual competitive pressure from international giants and domestic newcomers, as well as global macroeconomic weakness, slowing downstream terminal demand growth, or deep, sustained downturns in the semiconductor industry affecting operating performance.
A core uncertainty is that the final valuation and consideration have not been finalized. As of the signing date of the plan, Hengtai Ke's audit and evaluation work is still underway, and the transaction price has not been disclosed. The share issuance price is set at 28.48 yuan per share, with a lock-up period of 36 months for the counterparties. The raised matching funds will be used to pay transaction taxes, intermediary fees, project construction, and supplement the listed company's working capital and repay debts.
Unaudited data shows that Hengtai Ke's revenue in 2024 and 2025 was 206 million yuan and 193 million yuan, respectively; net profit attributable to parent was 32.2325 million yuan and 35.718 million yuan, maintaining stable profit growth. By end of 2025, Hengtai Ke's parent company's equity was only 416 million yuan, showing significant asset-light characteristics.
Jiang Han noted that for asset-light semiconductor design companies, valuation centers on intangible assets like IP cores and R&D teams. Traditional PE/PB models often fail due to profit volatility and high upfront investment. Reasonable valuation should be based on a multi-phase DCF model, cross-validated with relative valuation methods, while incorporating qualitative factors such as technology iteration risk and downstream application cyclicality into quantitative considerations.
From Galaxy Microelectronics' fundamentals, net profit attributable to parent declined year-on-year from 2022 to 2023. In 2024, revenue reached 909 million yuan, up 30.75% YoY; net profit was 71.8742 million yuan, up only 12.21% YoY. In 2025, full-year revenue was 1.05 billion yuan, up 15.46% YoY; net profit was 79.9047 million yuan, with growth slowing to 11.17%.
On the funding front, Galaxy Microelectronics' cash and cash equivalents at end-2025 were only 137 million yuan, down 44.65% YoY. Operating cash flow net inflow was 43.7501 million yuan, down 34.73% YoY, affected by extended customer payment terms and increased inventory.
Consolidation Synergy and Compliance Questions: Goodwill Risk and Pre-Halt Abnormalities
A private fund insider believes the key to this acquisition realizing cyclical dividends lies in the consolidation pace and synergy realization. Hengtai Ke has stable revenue and profits, which can directly boost the listed company's performance after consolidation, but both companies are relatively small in size, and whether '1+1>2' synergy can be achieved remains uncertain. The biggest risk is high-premium acquisition forming large goodwill; if future performance falls short, goodwill impairment will erode the listed company's profits.
Additionally, abnormal stock price movements before the halt have sparked widespread market suspicion of insider information leakage. Before the suspension announcement, Galaxy Microelectronics' stock suddenly surged on June 10-11, rising nearly 19% over two trading days with significantly expanded volume; during the same period, the semiconductor industry index rose only 2.70%. The company issued a statement that relevant parties did not engage in insider information leakage or insider trading violations.
