Gelin Bio-Technology (格林生物)
A hidden strength in the global fragrance supply chain — Jiande, Zhejiang-based specialty chemicals producer that listed on the Shenzhen ChiNext board after 27 years and three IPO attempts (301688.SZ)
Gelin Bio-Technology Co., Ltd. (“Gelin Bio” or “the Company”) traces its roots to a 1999 fragrance-chemicals venture founded in Jiande, Zhejiang Province, under the name Hangzhou Gelin Fragrance Chemical Co. The Company converted to a joint-stock structure in late 2010 and adopted its current name in 2011, ultimately listing on the Shenzhen Stock Exchange ChiNext board (ticker 301688) on September 2, 2026. In our assessment, the 27-year gap between founding and listing — spanning three separate IPO filings — warrants close scrutiny of governance and succession dynamics.
Born November 1942, making him roughly 83–84 years old at the time of listing. Graduated with a chemistry degree from Hangzhou University in December 1968 and holds the title of Senior Engineer. Entered the fragrance and flavor industry in 1970, holding roles including technician at the Jiande Chemical Products Plant, plant manager at Jiande Xin’anjiang Fragrance Factory, deputy chairman and general manager of Shenzhen Jianhua Fragrance Co., and deputy chairman and general manager of International Flavors & Fragrances (Hangzhou), before founding the predecessor of Gelin Bio in 1999. Per company disclosure, he directly held 27,111,800 shares (27.11%) pre-IPO as the largest shareholder and de facto controller.
Lu Wencong’s daughter, holding a 9% pre-IPO stake as a director and deputy general manager. In June 2025 she and her father entered into an acting-in-concert agreement, formally establishing joint actual-controller status. In our view, this structure reflects a phased handover of control to the next generation, and regulators have explicitly flagged succession-related control stability as a key follow-up item in the listing review.
During the 2023 SZSE review process, regulators identified a personal lending relationship between shareholder Chen Jiade and Zhu Jianfeng, a project manager at a key equipment-installation contractor (Zhejiang Industrial Equipment Installation Group). As of June 2021, outstanding borrowings totaled approximately RMB 1.18 million. The Company characterized this as a private, friendship-based loan, and available reporting indicates the balance was repaid using proceeds from a 2022 dividend distribution. The commercial substance of the loan and the ultimate use of dividend proceeds cannot be independently verified beyond the Company’s public response; we flag this as a governance item for monitoring rather than draw a definitive conclusion.
Since inception, Gelin Bio has focused on the R&D, production, and sale of fragrance-chemical ingredients, organized into three product families — turpentine oil, cedarwood oil, and fully synthetic fragrances — spanning roughly 40 sub-variants including sandalwood-series products, methyl cedryl ketone, and damascenone-series compounds. These products serve as raw-material inputs for downstream household- and personal-care fragrance compounding (detergents, cleaning products, disinfectants, personal care). Per company disclosure, the three product families together account for more than 97% of core business revenue.
Over FY2023–FY2025, revenue progressed from RMB 735m to RMB 961m to RMB 1.075bn (a 20.95% CAGR), while net profit grew from RMB 93m to RMB 150m to RMB 179m (a 38.78% CAGR) — profit growth has consistently outpaced revenue growth. That said, Q1 2026 revenue rose 15.95% year-over-year to RMB 318m, while parent-attributable net profit declined 1.13% year-over-year to RMB 50.09m, which in our view signals emerging cost-margin pressure.
The Company has developed proprietary molecular-modification technology for natural raw-material inputs, addressing safety-control issues inherent in traditional processes and improving fragrance purity and yield. However, both average selling price and gross margin declined year-over-year in 2025, and the production-to-sales ratio fell from 119.66% in 2023 to 78.58% in 2025 — in our view, an early signal of softening demand.
Gelin Bio has designed proprietary temperature-controlled reflux equipment, automated control systems, catalytic acetylation, and solvent-free esterification technologies that improve acetic-acid and catalyst reuse rates while sharply reducing alkali consumption in saponification. The Company is assessed to be one of China’s largest suppliers of methyl cedryl ketone.
This segment reached a 47.09% revenue share in 2025, becoming the largest single revenue contributor. Damascenone — a rose-scented, high-value-add compound — grew from roughly RMB 126m in sales in 2023 to RMB 320m in 2025, lifting its share of synthetic-series revenue from 45.37% to 63.52% and serving, in our assessment, as the primary driver of company-wide margin expansion.
Customer Base & Export Mix: Gelin Bio has maintained supply relationships spanning more than two decades with global fragrance and household-chemical leaders including Givaudan, DSM-Firmenich, IFF, Symrise, and Procter & Gamble. Export revenue has consistently exceeded 85% of the total across the reporting period, with Europe and North America as core markets. Top-five customer concentration has remained stable in the 40–44% range (43.98% in 2022 versus 42.3% in H1 2025), which in our view limits single-customer dependency risk. We note, however, that IFF — one of the Company’s largest customers — is simultaneously a key competitor, a structural tension worth flagging separately.
Capacity Constraints: Utilization at the Jiande headquarters facility already exceeds nameplate capacity, running at 110.10% in 2024 and 107.76% in 2025; the damascenone line ran at 101.57% utilization as of 2023. Of the RMB 690m in IPO proceeds, RMB 420m is earmarked for a 6,300-tonne annual advanced-fragrance production project (expanding damascenone and sandalwood-series capacity), RMB 120m for smart-factory upgrades, RMB 70m for R&D innovation, and RMB 80m for working-capital replenishment.
Gelin Bio’s R&D expense ratio — 2.52% (2023), 2.73% (2024), and 3.47% (2025) — has consistently trailed the peer-group average of 4.59%, 4.28%, and 4.08% over the same years. In September 2025, the SZSE issued a disciplinary “interview” measure against the sponsor representatives citing, among other findings, inadequate internal controls over R&D and procurement and inaccurate R&D expense accounting. Separately, media reporting has cited a RMB 125m discrepancy between the total investment disclosed in a prior fundraising-project prospectus (RMB 575m) and the figure stated in the corresponding environmental-impact assessment (RMB 700m), along with timing gaps between disclosed construction schedules and formal environmental approval dates. The Company has characterized this as forward-planned investment executed ahead of formal approval; we flag this figure as self-reported and unresolved pending independent verification.
Per publicly available Tianyancha records, Gelin Bio raised capital across four pre-IPO rounds — angel, Series A, Series B, and Series C — between 2010 and 2022. Investor identities, round sizes, and valuation terms for these rounds are not comprehensively disclosed in the prospectus or in the media sources we reviewed, and we flag this as a Data Gap. In our assessment, the more consequential element of Gelin Bio’s capital-markets narrative is the Company’s three-attempt IPO journey itself, which offers a useful lens on its disclosure practices and internal-control maturity.
Lu Wencong established the entity in Jiande, Zhejiang, entering the fragrance-chemicals business. Between 2003 and 2015 the Company completed a facility relocation and technical-upgrade program, expanded its product line to include synthetic sandalwood and damascenone, broadened distribution across mature markets (North America, Europe) and emerging markets (Asia, South America), and entered the global supply chains of P&G and other top-ten fragrance and flavor houses.
The Company completed its joint-stock conversion in late 2010 and renamed itself Gelin Bio-Technology Co., Ltd. in 2011. Four pre-IPO equity rounds are understood to have occurred over this period, though publicly available detail on investor composition and round sizes remains limited.
Gelin Bio first filed for a ChiNext listing on December 18, 2020, targeting RMB 335m in proceeds. Shortly after being selected for an on-site regulatory inspection, it emerged that a subsidiary (Jiande Manan Property Management) had been fined RMB 200,000 in July 2020 for volatile-material handling and containment lapses that had not been disclosed in a timely manner. Combined with an anticipated sharp profit decline for 2021 driven by rising raw-material costs (pinene, acetic anhydride), the Company voluntarily withdrew the application on February 18, 2021.
The Company refiled on June 2, 2023 with Everbright Securities (长江证券) as sponsor. Across two rounds of regulatory inquiry, reviewers raised questions about ChiNext listing suitability and environmental permitting — including an unfiled energy-conservation review for a planned 4,000-tonne production project and a missing development-and-reform-commission filing for a natural-gas boiler project — leading to a second voluntary withdrawal on September 3, 2024.
The SZSE conducted formal interview-based disciplinary measures against Gelin Bio, its then-actual controller, general manager and CFO, and sponsor representatives Han Song and Wang Jing of Everbright Securities. Cited deficiencies included inadequate internal controls over R&D and procurement, inaccurate R&D expense accounting, insufficient scrutiny of raw-material purchase-price fairness, and incomplete verification procedures.
The Company filed for a third ChiNext listing attempt, again with Everbright Securities as sponsor, raising its target proceeds by roughly 84% versus the prior RMB 375m target to RMB 690m.
At its 27th review session of 2026, the SZSE Listing Committee concluded Gelin Bio met issuance, listing, and disclosure requirements, while requiring further substantiation of control stability, fundraising-project permitting progress, and subsequent product-price and margin movements. The China Securities Regulatory Commission (CSRC) approved registration on June 24, 2026.
The Company priced its offering at RMB 26.33 per share (19.80x earnings), issuing 33,333,334 shares. Strategic placement accounted for 5,848,834 shares (17.55% of the offering), and the retail tranche saw an effective subscription multiple of roughly 6,954.5x — culminating a 27-year path to public markets and a third attempt at listing.
• Offering size: 33,333,334 new shares · Offer price RMB 26.33/share · Offer P/E 19.80x
• Gross / net proceeds: RMB 878m (877.6667m) / RMB 770m (770.4438m)
• Allocation structure: Strategic placement 5,848,834 shares (17.55%) · Institutional (offline) 14,987,500 shares · Retail (online) 12,497,000 shares
• Use of proceeds: 6,300-tonne annual advanced-fragrance project RMB 420m · Smart-factory upgrade RMB 120m · R&D upgrade RMB 70m · Working capital RMB 80m
• Pre-listing history: Dec. 2020 (withdrawn) → June 2023 (withdrawn) → Nov. 2025 (third filing, successfully listed)
Multiple media reports have raised critical questions about a pattern in which Gelin Bio continued sizeable cash dividend distributions in the period leading up to its IPO filing while simultaneously earmarking RMB 80m of IPO proceeds for working-capital replenishment — characterized in Chinese-language coverage as a “dividend-then-raise” (掏空式分红) structure. Precise aggregate dividend figures and their timing require direct cross-reference against the full prospectus text, which we have not been able to independently verify from the sources reviewed. We acknowledge the qualitative direction of this criticism while treating the underlying figures conservatively pending further verification.
In our assessment, Gelin Bio’s competitive positioning rests on 27 years of accumulated process know-how, an entrenched position within Tier-1 global fragrance-house supply chains, and a degree of technical scarcity in high-value synthetic damascenone production. That said, we believe these strengths coexist with a softening R&D investment trajectory, below-peer liquidity metrics, and early signals of growth deceleration — warranting a balanced view rather than an unqualified bullish read.
Gelin Bio has maintained long-standing supply relationships with leading global fragrance and household-chemical companies, including Givaudan, DSM-Firmenich, IFF, Symrise, and P&G, with export revenue consistently exceeding 85% of total sales. The Company holds recognition as a National High-Tech Enterprise, a Zhejiang “Specialized, Refined, Distinctive, and Innovative” (专精特新) enterprise, and a top-ten China light-industry fragrance enterprise — in our view, evidence of a track record that raises the bar for new entrants.
Gelin Bio is assessed to be among a small number of Chinese producers with industrial-scale damascenone production capability. Per research from Huajin Securities, established international competitors with large-scale capacity in this segment — DSM-Firmenich and IFF — are reportedly shifting strategic focus toward downstream compounding and application, with no disclosed plans to expand damascenone capacity, potentially preserving a favorable competitive dynamic near-term. We note this is a third-party research house’s forward-looking view and an unverified assumption rather than a confirmed structural outcome.
Proprietary technologies — including molecular modification of natural turpentine feedstock, solvent-free esterification, and catalytic acetylation — earned the Company selection for a National Torch Program industrialization demonstration project, along with a Sinopec Science & Technology Progress Second Prize and a Zhejiang Provincial Science & Technology Third Prize, among other awards. That said, invention-patent holdings stood at 23 as of April 2026, up only 2 from 21 in 2023, and 5 patents had already lapsed out of protection by the same date — in our view, raising questions about the pace at which the Company is renewing its technical moat.
Consolidated debt-to-assets ratio improved from 65.48% (2023) to 65.65% (2024) to 57.89% (2025), and operating cash flow exceeded net profit in 2023–2024. However, the current ratio (1.31) and quick ratio (0.64) remain below industry averages; short-term borrowings rose 81.3% year-over-year in 2025 to roughly RMB 228m; and the operating-cash-flow-to-net-profit ratio declined from 1.51 to 1.37 to 0.89 over the same period — in our assessment, an emerging signal of weakening earnings-to-cash conversion.
Consolidated Investor Considerations (Our Assessment): In our view, Gelin Bio is best characterized as a fragrance-ingredient supplier with demonstrated cost and process competitiveness that is nonetheless entering an early phase of growth deceleration. The build-up in 2025 inventory (RMB 358m, 20.15% of total assets) and receivables (RMB 192m, 10.81% of total assets), the slowdown in year-end 2025 order-backlog growth (up just 1.94% year-over-year), and the decline in the turpentine-series production-to-sales ratio (from 119.66% to 78.58%) are all consistent with the risk the Company itself discloses in its prospectus — namely, the possibility of continued deceleration or even decline in future performance growth. Layering on the 84-year-old founder’s succession risk, below-peer R&D investment intensity, and a track record of three IPO withdrawals alongside a disciplinary interview measure, we believe early post-listing valuations could carry a premium relative to the Company’s demonstrated earnings-growth profile, warranting a disciplined approach to entry timing.
Estimates of the global fragrance and flavor market vary by source: QYResearch puts the market at roughly $30.6bn in 2023, rising to over $32bn by 2025, while Chinese domestic market estimates diverge further — Leadleo (头豹研究院) research cited in press coverage projects a 2018–2025 CAGR above 6.49% and a 2025 market size in the range of RMB 73.3bn, while other press coverage cites figures closer to RMB 50bn. We present these as a range rather than a single reconciled figure, and treat market-size projections as a reference data point subject to revision based on downstream demand trends.