Post-90s Builders for National Instruments: CIQTEK’s Scientific Pursuit and Capital Success

One look at CIQTEK’s prospectus and a set of figures stands out: in the spin‑resonance category, its EPR spectrometer holds over 80% of the domestic market and 25% globally; the quantum diamond single‑spin spectrometer has a 97% domestic share and over 55% global share. Several quantum microscopy products hold 100% of the domestic market, ranking first globally.

That means in the frontier track of quantum precision measurement, CIQTEK is already a recognised top‑tier global player.

2018 was a turning point. That year, the company launched its first commercial pulsed X‑band EPR spectrometer, becoming the first domestic firm to achieve commercial production. In the same year, CIQTEK partnered with the Huishan District government in Wuxi to establish the Quantum Perception Research Institute, beginning to explore industrial applications of quantum technology.

The product matrix expanded rapidly: in 2019, it launched China’s first scanning NV probe microscope and the world’s first quantum diamond single‑spin spectrometer; in 2023, it delivered China’s first commercial ion‑trap quantum computer. Today, CIQTEK covers four business segments: quantum information technology and spin resonance, electron microscopy, measurement‑while‑drilling, and gas adsorption analysis. Its products have moved from research labs to diverse scenarios including industrial quality inspection and energy exploration.

However, what truly supports the company’s revenue base is not its most cutting‑edge quantum computer, but electron microscopy, which sits squarely in the domestic‑substitution trend.

According to the prospectus, from 2023 to 2025, main business revenue was RMB 390 million, 484 million, and 663 million respectively, with a compound growth rate of nearly 30% over the three years. By business mix, the share of electron microscopy products rose year by year, reaching 56.29% in 2025; quantum information technology and spin resonance products grew steadily, accounting for 32.95% of revenue in 2025. In other words, for this company with the “quantum” halo, more than half of its revenue comes from the “second curve” of electron microscopy.

These are two distinct growth curves. The quantum product line has higher technological barriers and larger gross‑margin potential, but the domestic market is still in its cultivation phase. The electron microscopy segment rides the policy tailwind of domestic substitution, with strong demand, yet lower margins and fiercer competition. Gross margin has steadily improved to 46.98%, indicating enhanced pricing power and emerging scale effects. But at the intersection of these two curves lies a deeper proposition: as anxiety over supply‑chain security in semiconductors and other industries intensifies, electron microscopy, as the “eye of industry,” has a strategic value that makes this second curve not only a current profit source but also a future national‑level battleground. The tension between the two curves is both the background of CIQTEK’s business model and the core test for the market’s valuation logic.

CIQTEK’s rapid sprint on the STAR Market is inseparable from a carefully orchestrated capital chess game that has been laid out over eight years. From its early days in 2016, backed by Academician Du Jiangfeng’s technical endorsement and USTC’s resources, to a unicorn valuation of around RMB 7 billion in 2022, and then to a near‑RMB 10 billion valuation on the eve of its IPO, this hard‑tech company has completed a transition from “lab dark horse” to “capital darling” in just a few years.

In September 2018, CIQTEK received its first investment from a “USTC‑affiliated” institution, its first appearance in the capital market. But the real catalyst came in January 2021, when Hillhouse Ventures led a Series B round of several hundred million yuan. Public reports indicate that this was also Hillhouse Capital’s first move into the quantum technology space, underscoring CIQTEK’s benchmark significance in this frontier field.

After Hillhouse, more star capital followed. In December 2021, CIQTEK completed a Series C round of several hundred million yuan, with investors including China Venture Capital Fund, CAS Capital, IDG Capital, Hefei Industry Investment, Pinewood Capital, and Qianhai Mother Fund, with existing shareholders such as Spark Ventures, USTC‑Guochuang, Hillhouse, and Co‑win adding more. In October 2025, Hefei state capital – Xingtai Capital – made a strategic investment of RMB 131 million.

By the eve of the IPO, CIQTEK’s shareholder register was stellar: USTC Holding held 14.75%, Shuhua Technology 8.43%, the Hillhouse group collectively controlled 6.63%, and USTC‑Guochuang and iFlytek also appeared on the list. This constellation of prominent investors, while providing endorsement, also brings another layer of pressure – these financial investors’ fundamental objective is IPO exit. With a highly dispersed shareholding structure (pre‑IPO valuation near RMB 10 billion, with the top few shareholders holding less than 30% combined), the ownership of decision‑making and the stability of governance after listing will inevitably become a focus for investors.

More intriguing is an “escape” structure in the capital story. Neither He Yu nor Rong Xing holds shares directly; instead, they exercise control through multiple partnerships. Hefei Sikun directly holds 27.20% of CIQTEK as the controlling shareholder; He Yu also indirectly controls 3.24%, 3.24%, and 1.19% of voting rights through Hefei Weirao, Hefei Zixuan, and Hefei Lizi. The two signed a concert‑party agreement in July 2017, collectively controlling 34.87% of voting rights.

This is a meticulously crafted equity “mortise‑and‑tenon” structure. Although He Yu and Rong Xing hold no direct shares, they have locked core control through nested limited partnerships. Such an “indirect control” structure is uncommon in the A‑share market, but its purpose is clear: to facilitate flexible equity incentives while also avoiding the tax and lock‑up restrictions of direct personal holdings. Notably, CIQTEK completed a critical equity clean‑up just before the IPO – in May 2025, at the request of relevant authorities, Du Jiangfeng transferred his shares through public listing, with USTC Asset Management taking over, formally exiting the shareholder register. This “de‑academician” move was fundamentally to avoid administrative hurdles related to business activities by officials and the approval of technology commercialisation, thereby clearing the compliance red line for the listing.

If the star‑studded shareholder line‑up reflects the attitude of the capital market, then the actual operating data are the hard truth that determines whether a 10‑billion valuation can stand firm. The latest financial data present a mixed picture of “beauty” and “flaw.”

First, the bright side. From 2023 to 2025, revenue was RMB 400 million, 501 million, and 666 million, growing at about 30% annually, with a 32.85% increase in 2025. More notable is the pace of loss narrowing – net profit went from -RMB 140 million, to -74.08 million, to -5.80 million, with a 92.17% reduction in losses in 2025. Core net profit also narrowed from -RMB 169 million in 2023 to -RMB 18.88 million in 2025. Management expects the company to achieve consolidated profitability in 2026, which will be the most anticipated fulfilment point after the review.

Another set of figures stands out: operating cash flow jumped from -RMB 134 million in 2023 and -RMB 50.24 million in 2024 to RMB 118 million in 2025, not only turning positive but also showing that the company has achieved preliminary self‑generating cash capability. For a hard‑tech company still in the phase of industrial deployment, this is a more robust health indicator than net profit.

However, the “flawed” side is equally significant. By the end of 2025, consolidated retained earnings were -RMB 360 million, and the cumulative uncovered losses remain substantial. R&D spending declined year by year – from RMB 131 million in 2023 to RMB 116 million in 2024 and RMB 111 million in 2025, with the R&D expense ratio dropping from 32.72% to 16.64%, already below the peer average of 22.64%. In Q1 2026, revenue was only RMB 52.67 million, with a net loss of RMB 71.43 million, heavily influenced by seasonality – reminding the market once again that the company is still far from “stable profitability.”

This is precisely the nuance of the STAR Market’s fourth set of listing criteria. CIQTEK chose the path of “expected market value of no less than RMB 3 billion and revenue of no less than RMB 300 million in the most recent year” rather than the profit‑based standard. In other words, regulators allow it to list with losses because of three layers of “strategic value” that outweigh short‑term financial metrics: first, its breakthroughs in domestic substitution in high‑end scientific instruments carry irreplaceable national strategic importance; second, its global leading position in the frontier of quantum precision measurement provides a deep technological moat; third, the losses are primarily due to upfront R&D and market development investments, not fundamental flaws in the business model.

The Listing Committee did not relax its standards. The core question during the on‑site inquiry was “the sustainability of operating performance growth” – covering market space, competitive landscape, customer structure, and orders in hand. The company passed because it presented this growth logic: brand barriers are forming, gross margin is rising, operating cash flow has turned positive, and the certainty of future revenue backed by orders in hand is increasing. Whether this logic holds will be tested by the secondary market with real money after listing.

Beyond the company itself, CIQTEK’s IPO story is a contemporary example of the rise of the “Quantum Avenue” industrial cluster on Yunfei Road in Hefei High‑tech Zone.

On the 3.5‑kilometre road known as “Quantum Avenue” in the Hefei High‑tech Zone, 81 quantum‑related enterprises are densely clustered, forming the most concentrated quantum industry ecosystem in the country. Industry leaders such as Origin Quantum, QuantumCTek, and CIQTEK sit side by side, covering the three major technology areas of quantum computing, communication, and measurement.

How did Hefei achieve this? Its logic can be summarised as a “closed‑loop incubation from seed”: first, relying on USTC to provide original technology from 0 to 1 for quantum technology; then, through local capital such as Hefei Industry Investment and Xingtai Capital, bringing in market‑oriented funds and industrial resources from 1 to 10; at the municipal level, introducing special policies for the quantum industry, focusing on supporting collaboration between enterprises and universities, and rewarding revenue milestones, demonstration application scenarios, and patent innovation applications.

For CIQTEK, Hefei is not just a place of incorporation, but a testing ground for the “industry‑university‑research‑capital” five‑in‑one empowerment model. The prospectus discloses that among the core technical team, seven people previously worked at USTC; among the eight management members, three have ties to USTC. USTC Holding holds 14.75% of the company, making it the second largest shareholder. In other words, the underlying elements of CIQTEK – talent, technology, and capital – all form an organic closed loop within Hefei’s quantum ecosystem.

At the macro level, national policy is the driving force. The 2026 Government Work Report mentioned quantum technology seven times, and the quantum industry was for the first time placed in a prominent position among “future industries” for full‑chain deployment. CIQTEK’s passage on the STAR Market is not just the IPO of a single company, but also a clear signal that quantum technology is shifting from the “lab prototype validation” phase to a new cycle of “large‑scale capital allocation” in the capital market.

CIQTEK’s passage on the STAR Market is a “milestone report card”, not the “final answer.” Three more hurdles await.

First, sustained performance delivery. With cumulative losses of -RMB 360 million by the end of 2025, even if the company turns profitable in 2026, it will be hard to cover the historical gap in the short term. The fact that Q1 2026 revenue was only RMB 52.67 million and a loss of RMB 71.43 million means this year’s turnaround mainly depends on concentrated deliveries in the second half. If delivery progress falls short, the market’s trust in its profit expectations will be shaken.

Second, strategic independence and stability of the shareholder structure. Institutions such as Hillhouse, Tencent, iFlytek, and China Venture Capital have invested a total of about RMB 1 billion; their core aim is an orderly exit after the IPO. After listing, He Yu and Rong Xing’s combined control will dilute to about 31.38% – a delicate “tightrope balance” – and no company wants to face management uncertainty caused by a loosening equity structure right after listing.

Third, resources for sustained innovation. The downward trend in R&D investment has drawn market attention, and the peer average R&D expense ratio is 22.64%, against CIQTEK’s 16.64% in 2025 – clearly a disadvantageous “chasing” position. If the company accelerates R&D investment after listing with financing support, it can prove that earlier losses were pre‑investment for long‑term competitiveness; but if it compresses R&D intensity to report profits earlier, it may weaken its future technological moat and run counter to its mission of “building instruments for the nation.”