3.2 billion! This domestic analog chip company wants to acquire its peers

01
Since 2020, there have been four mergers and acquisitions.

From its founding in 2008 to its frequent, multi-billion dollar acquisitions, Jingfeng Mingyuan, a leading LED driver chip company, has been quite active in mergers and acquisitions.

A review of Jingfeng Mingyuan's acquisition activity reveals that it has been involved in four acquisitions (including proposed acquisitions) since 2020:

● In early 2020, the company spent 46 million yuan of its own funds to acquire Shanghai Laishi; ● Between 2020 and 2021, it invested a total of 270 million yuan in two installments to acquire Shanghai Xinfei; ● Between 2023 and 2025, it acquired all of Lingou Chuangxin's equity in three installments, totaling 518 million yuan; ● In 2025, it plans to acquire Yi Chong Technology for a grand total of 3.283 billion yuan.

It's easy to see that Jingfeng Mingyuan's acquisitions are getting larger with each successive round, and its expansion is intensifying.

When asked why Jingfeng Mingyuan is so keen on acquisitions, its founder Hu Liqiang once said in an interview that acquisitions are made in order to become bigger and stronger, and he made it clear that in the future he will continue to promote investment and mergers and acquisitions based on strategic needs.

Let's return to Jingfeng Mingyuan's beginnings. Founded in 2008, the company capitalized on the golden era of the LED lighting industry, transitioning from its infancy to its explosive growth. Working closely with distributors, they quickly established a foothold in the market.

In 2008, they launched their first LED lighting driver chip, initially gaining customers and distributors. By "surrounding the city from the countryside," they secured their largest early

 customers from locations even taxis couldn't reach. By 2009, the company's sales had reached 100 million yuan.

The company's approach was pragmatic. Not only did they continuously optimize chip integration and system solutions to reduce overall costs and improve yield rates for customers, they also actively supported distributors in developing solutions and providing technical support, thereby improving sales efficiency. This strategy quickly established Jingfeng Mingyuan in the LED lighting market. Clients include Philips, Opple Lighting, NVC Lighting, Sunshine Lighting, Sanxiong Aurora, Foshan Lighting, and Debang Lighting.

The company's performance subsequently soared. In 2018, the company sold 3.8 billion LED lighting driver chips in China, generating revenue of 767 million yuan and a market

 share approaching 30%, instantly becoming the leader in its segment. In 2019, the company was listed on the Science and Technology Innovation Board (STAR Market). In the

 following years, driven by explosive growth in LED lighting driver chips and a supply-demand imbalance in the chip industry, revenue soared from 813 million yuan to 2.122 billion

 yuan between 2019 and 2021.

The company's business is divided into two main categories: power management chips and control driver chips. By 2024, LED lighting driver chips will remain the company's largest

 revenue source, accounting for 58%. Sales channels are primarily through distributors, supplemented by direct sales, with the former contributing approximately 77% of revenue.

Looking at the entire domestic analog chip market, Jingfeng Mingyuan's revenue of 1.5 billion yuan already ranks among the top ten. However, compared with the top three

 manufacturers, there is still a significant gap. According to previous forecasts, the size of China's power management chip market will reach 145.2 billion yuan in 2024. Since

 Jingfeng Mingyuan derives the majority of its revenue from this field, its overall market share remains limited.

After establishing a leading position in LED lighting driver chips, Jingfeng Mingyuan went beyond its niche and began expanding into a diverse product line, moving into power

 management chips (AC/DC) with wider applications.

The analog chip industry relies heavily on experience accumulation, with long product life cycles and a wide range of product categories. Relying solely on organic growth often

 makes it difficult to rapidly improve product portfolios. Therefore, mergers and acquisitions have become a key path to achieving significant growth. Jingfeng Mingyuan's initial

 focus on niche areas and gradual diversification are also in line with this trend.

As a result, high-performance computing power chips, AC/DC power chips, and motor control driver chips gradually became the company's new "three pillars."

Several rounds of acquisitions, centered around this strategy, have continuously expanded the product line:

● Shanghai Laishi and Shanghai Xinfei: enriched the LED lighting driver product line, adding external AC/DC power chips; ● Lingou Chuangxin: strengthened the technical strength

 and product portfolio of motor control chips; ● Yi Chong Technology (proposed acquisition): The two companies will form a combined force in charging protocols and power

 management, while Yi Chong's high-side drivers and Jingfeng Mingyuan's motor control chips will create synergies in automotive solutions. It is reported that in the field of wireless

 charging chips, Yi Chong Technology's overall sales volume will rank among the top three globally in 2024, and it will be the world's largest in the non-iOS mobile phone wireless

 charging chip market.

According to data from ChinaVenture, Jingfeng Mingyuan has also invested in six startups and funded eight funds, covering semiconductor fields such as MCUs and signal chain

 chips, helping to expand its business and create potential synergies. In 2025, Jingfeng Mingyuan also jointly invested with nine institutions to establish Ningbo Yixinwei.

However, challenges must be considered. After experiencing a surge in downstream market demand for LED lighting drivers in 2021, market demand has diverged, and prices for

 key products have declined. Jingfeng Mingyuan's LED lighting driver chip revenue share is expected to decline from 72.3% in 2023 to 57.76% in 2024. The company explained that

 this is due to fierce market competition for general-purpose LED products, with declining unit prices outweighing sales growth.

Meanwhile, AC/DC power supply chips (primarily used in home appliances and fast charging) are considered the company's second growth area, with revenue expected to surge

 39.64% year-on-year in 2024 and their share also increasing.

In other words, profits in its core business have already declined. New battlefields, such as power management chips, present formidable domestic and international competitors.

Jingfeng Mingyuan's current acquisitions and expansions are both a proactive search for new growth points and a forced step outside its comfort zone to enhance its competitiveness.

02

After years of losses, can it grow again through acquisitions?

In fact, after a surge in net profit in 2021, Jingfeng Mingyuan has been in the red for three consecutive years.

From 2022 to 2024, Jingfeng Mingyuan's net losses reached 206 million yuan, 91 million yuan, and 33 million yuan, respectively.

In 2022, Jingfeng Mingyuan suffered a net loss of 206 million yuan due to fluctuations in the LED lighting driver product industry, shrinking downstream demand, high channel

 inventory, and product price reductions, coupled with continued R&D and personnel investment.

Entering 2023, the company's net loss showed a gradually narrowing trend. Previously accumulated obsolete inventory was gradually reduced, and the recovery of the lighting

 market drove sales growth. Furthermore, through product structure optimization, cost control, and improved inventory turnover, the net loss was reduced to 91 million yuan.

By 2024, despite declining prices for general-purpose LED products and continued fierce competition, the company's market expansion, cost reduction, and efficiency gains in

 smart lighting and high-end dimming products, coupled with continued R&D investment, further narrowed its net loss to 33 million yuan. Jingfeng Mingyuan's 2024 annual report

 shows that the company achieved operating revenue of 1.503 billion yuan in 2024, a year-on-year increase of 15.38%. Its net profit attributable to shareholders was -33.0513 million

 yuan, and its net profit excluding non-recurring items was -9 million yuan. Both the year-on-year losses before and after deducting non-recurring items narrowed.

The 2024 loss was primarily due to increased R&D expenses. The company's R&D expenses in 2024 were 400 million yuan, a year-on-year increase of 36.04%. Due to the

 uncompleted performance assessment of restricted stock in 2023, the company reversed some share-based payment expenses, resulting in a higher base for R&D expenses in 2024.

Overall, Jingfeng Mingyuan's losses reflect the challenges facing the domestic chip design industry, after experiencing rapid growth, such as intensified market competition and

 fluctuating demand. According to statistics from the China Semiconductor Industry Association, among the 108 chip design listed companies in 2023, 66 companies were profitable

 in the semi-annual report and 42 companies were loss-making, with a loss rate of 38.9%. The entry threshold for the top ten design companies in 2023 also dropped from 7 billion

 in 2022 to 6.5 billion.

The performance of acquisitions made by Bright Power Semiconductor has been a mixed bag.

According to the annual report, Shanghai Xinfei generated revenue of RMB 97.23 million in 2024, with a net profit of only RMB 2.25 million. Shanghai Laishi, which was dissolved in

 December 2024, reported a loss of RMB 300,000 in the first half of the same year. In contrast, Linko Semiconductor delivered outstanding results: it achieved revenue of RMB 298

 million and a net profit of RMB 86 million in 2024, with both figures showing year-on-year growth, making it the most successful acquisition target.

Meanwhile, Yichong Technology, which the company plans to acquire, is growing rapidly but remains loss-making.

In 2023 and 2024, Yichong Technology reported revenues of RMB 650 million and RMB 960 million, representing growth rates of 46% and 47%, respectively. However, it also

 recorded significant net losses of RMB 502 million and RMB 512 million during the same periods.

Adding to the concerns, Bright Power Semiconductor had only RMB 280 million in cash on its books in 2024, while its short-term debt reached RMB 373 million. This has naturally

 raised market worries about the company’s short-term financial pressure, given the acquisition’s total price of RMB 3.29 billion and a premium as high as 260%. To alleviate

 cash flow strain, Bright Power Semiconductor has had to launch a private placement to raise up to RMB 1.8 billion, intended for covering the cash consideration of the

 transaction, supplementing working capital, and paying intermediary fees.

So, the question arises: Why would Yichong be acquired under such circumstances?

Some media reports suggest that Yichong Technology initially considered an IPO on the STAR Market but shifted to acquisition as an alternative path to listing amid tightening IPO

 policies. For Bright Power Semiconductor, although Yichong is currently loss-making, its growth is strong. Both companies operate in the analog chip industry and could create

 synergies, making this acquisition a strategic bet on future potential.

The good news is that Jingfeng Mingyuan's performance in the first half of 2025 showed a positive trend: revenue reached 731 million yuan, a slight year-on-year decrease of

 0.44%, but net profit attributable to the parent company reached 16 million yuan, a significant year-on-year increase of approximately 152%; net profit excluding non-recurring

 items was 13 million yuan, a year-on-year increase of 170%; and gross profit margin also rose to 39.6%, a year-on-year increase of 4.18 percentage points. This has brought some confidence to the market.

The semi-annual report shows that the company has actively responded to market demand, continuously reducing costs and increasing efficiency through process iteration and

 strengthened supply chain management, resulting in an increase in overall gross profit margin compared to the previous year. At the same time, the company has continuously

 optimized its product mix, further strengthening its technical and product capabilities in the field of motor control driver chips.

03 Concluding Remarks

Jingfeng Mingyuan began its business in LED lighting driver chips. After securing a leading position in the market through channel and solution optimization, it gradually

 expanded into multiple product lines, including AC/DC power supply chips and motor control chips. Currently, with increasingly fierce competition in the domestic alternative

 market, the analog chip industry has also entered a period of reshuffle, with mergers and acquisitions becoming the norm. Jingfeng Mingyuan is not an isolated case; many

 domestic analog chip companies, such as Shengbang Shares, SiRuiPu, Naxin Micro, and Xidi Micro, are also "putting together the puzzle pieces," and have stepped up to fill out

 their product portfolios. Whether these expansions will translate into growth momentum remains to be seen.