FINANCE RESOCIATION, November 22 (Reporter Wang Biwei) - Huiding Technology (603160.SH), a major fingerprint chip manufacturer, is about to enter a new field. Huiding Technology announced tonight that the company is planning to purchase control of display chip manufacturer Yunying Valley Technology Co., Ltd. (hereinafter referred to as Yunying Valley) by issuing shares and paying cash, while the company plans to issue shares to raise supporting capital.

According to the announcement, on November 22, Huiding Technology signed a “Stock Acquisition Intent Agreement” with Gu Jing, Shenzhen Yishi No. 1 Enterprise Management Center (limited partnership), Shenzhen Yisheng No. 1 Enterprise Management Center (limited partnership), and Shenzhen Yisheng No. 2 Enterprise Management Center (limited partnership).

At the same time, the company said that since the transaction is still in the planning stage and there is still uncertainty about the relevant matters, trading of the company's shares will be suspended from November 25, and the expected suspension period will not exceed 10 trading days.

According to Tianyancha data, Huiding Technology's current trading partner, Gu Jing, is the actual controller of Yunying Valley and directly holds about 0.1738% of the company's shares; the other three trading partners, Shenzhen Yisheng No. 1 Enterprise Management Center, holds about 9.6566% of the shares, Shenzhen Yisheng No. 1 Enterprise Management Center holds about 6.3597% of the shares, and Shenzhen Yisheng No. 2 Enterprise Management Center holds about 3.3704% of the shares. As can be seen from the calculation, Huiding Technology has acquired a total of about 19.5605% of Yunying Valley's shares. After the transaction is completed, it will become the largest shareholder in Yunying Valley's current structure.

According to the official website of Yunying Valley, the company was founded in 2012. It is an enterprise specializing in R&D, design and sales of OLED display driver chips with display technology research and development as the core.

At present, Yunying Valley has a certain leading position in the field of OLED display driver chips. According to an article by research agency CinnoResearch, Yunying Valley ranked sixth in the world in terms of overall AMOLED display driver chip sales in 2022, ranking first among mainland Chinese suppliers. Yunying Valley also expects that in 2024, the company will ship 55 million to 60 million OLED driver chips for branded mobile phones; in addition, among independent display driver backboard chip manufacturers, the company ranked first in the world in 2022 for sales of Micro OLED silicon-based display driver backplane chips.

It is worth mentioning that Yunying Valley had a clear IPO plan before. In January 2023, CICC released the “Report on Yunying Valley Technology Co., Ltd. Initial Public Offering and Listing Guidance and Filing Report”. Since then, the company has carried out several rounds of financing, but has not officially submitted an IPO declaration.

For Huiding Technology, finding new quantities is an important task for the company at present, and purchasing assets related to display chips can also be seen as a sign of its entry into a new field.

Before 2018, Huiding Technology developed rapidly due to the rapid popularity of smartphones, but as Apple bid farewell to fingerprint unlocking and the use of facial unlocking, superimposed smartphones bid farewell to high growth, the profitability of the fingerprint chip industry also experienced a cliff-style decline. From 2019 to 2023, Huiding Technology's revenue fell from 6.473 billion yuan to 4.408 billion yuan, and gross margin gradually declined from 60.4% to 40.46%.

A person from Huiding Technology's securities department said in an interview with a reporter from the Financial Federation on October 29 this year that currently the traditional under-screen fingerprint business is relatively stable, and the company's performance growth will mainly be brought about by new fields such as ultrasonic fingerprinting, light sensors, and NFC products.