Since the launch of the SSE STAR Market, there have been over 600 listed companies, but true machine tool manufacturers are few and far between. Today's focus is on Guosheng Intelligence Technology (688558), the first company in China's metal cutting machine tool industry to be listed on the SSE STAR Market. Machine tools are known as "machines that make machines" and serve as the foundation of the manufacturing industry. Without them, aircraft wings, automobile engines, and semiconductor equipment bases would be out of the question. In this issue, we will break down exactly what enables this company to gain a firm foothold in the "tough nut to crack" field of high-end CNC machine tools.
01. From Sheet Metal Workshop to Gantry Heavy Equipment
Guosheng Intelligence Technology did not start from a high profile. It is not a "noble descendant" spun off from a large group, but rather grew out of a precision sheet metal workshop. Through four generations and a century of mechanical manufacturing accumulation, it has climbed step by step up the machine tool industry chain. In the company's own words, this is a path of "starting from OEM of equipment components and integrating upwards from the bottom up." It first engaged in precision sheet metal welding, then castings, then functional components, and finally assembled complete machines. This "bottom-up" approach is not common in the industry, but the advantage lies in accumulating a solid technological foundation in every link.
Today, the company has formed three major business segments: CNC machine tools, intelligent automated production lines, and equipment components. Its core products cover vertical machining centers, gantry machining centers, horizontal boring and milling machines, and 5-axis simultaneous machining centers. In the first half of 2026, the CNC machine tool segment contributed CNY 625 million in revenue, accounting for approximately 84.6% of total revenue, while the intelligent automated production lines and equipment components contributed approximately CNY 51 million and CNY 59 million, respectively. Product applications have extended from traditional advantageous fields such as precision molds and wind power to civil aviation, semiconductors, humanoid robots, and NEVs (New Energy Vehicles). Currently, customized solutions have been formed in these six major industries.
In terms of performance, in the first half of 2026, the company achieved an operating revenue of CNY 738 million, a year-on-year increase of 14.29%; net profit attributable to parent company shareholders was CNY 93.579 million, a year-on-year increase of 14.05%; and net profit attributable to parent company shareholders after deducting non-recurring gains and losses was CNY 87.5839 million, a year-on-year increase of 13.75%. Against the backdrop of the accelerating recovery of the entire machine tool industry, this growth rate is not stunning, but it wins in stability. According to statistics from the China Machine Tool & Tool Builders' Association, from January to February 2026, the industry's metal cutting machine tool revenue increased by 15.3% year-on-year, and exports increased by 16.9% year-on-year. Guosheng Intelligence Technology has basically kept pace with the overall market trend.
02. Where Is the R&D Money Spent?
When machine tool companies discuss their sci-tech innovation attributes, it ultimately comes down to two things: first, the intensity of R&D investment, and second, the ability to implement products in high-end scenarios.
In the first half of 2026, Guosheng Intelligence Technology's R&D investment reached CNY 36.8791 million, a year-on-year increase of 12.76%. During the reporting period, the company newly acquired 19 intellectual property rights, including 7 invention patents; as of the end of the reporting period, it cumulatively owned 370 intellectual property rights, including 87 invention patents. In terms of technology roadmap, the company focuses on five core technologies: CNC machine tool error compensation, precision reliability, composite machining, 5-axis simultaneous machining, and functional component R&D. The goal is very clear—to secure a position in the core track of domestic substitution by combining the high-end capability of 5-axis simultaneous machining with the localization of core functional components. In 2025, the MX650 vertical 5-axis machining center independently developed by the company was awarded as the first (set) equipment in Jiangsu Province.
What is worth attention is the penetration of products in specific industries. In the semiconductor sector, the company has developed high-speed and high-precision horizontal machining centers for cavity-type parts, and high-speed gantry machining centers for equipment base-type parts. Additionally, there are high-speed vertical machining centers and high-precision vertical grinding machines designed for processing brittle materials such as ceramics and silicon carbide. Multiple CNC machine tools have achieved batch applications among leading customers in the semiconductor field. For the two new directions of humanoid robots and AI liquid cooling, the company has also taken substantive actions: it developed a dual-spindle horizontal turning center for the liquid cooling industry, and enriched the vertical cradle 5-axis machining center series for humanoid robots. These are not "riding the wave" at the conceptual level, but rather the implementation of specific products corresponding to specific part processing scenarios.
03. Behind the Full Order Book, Can the Logic Be Realized?
The most direct way to judge whether a machine tool enterprise is worth continuous tracking is to look at its orders. During the institutional research in early September, the company clearly stated that "the order book in hand is full, and we remain confident in the order trend for the second half of the year." The participating institutions were Guojin Securities and Ping An Asset Management, and the focus of attention was on industry prosperity, layout in emerging fields, and the company's future strategy.
From the perspective of the industry's macro cycle, the machine tool industry has a cycle of about 2 to 3 years. This round bottomed out in 2023, experienced a mild recovery from 2024 to 2025, and in 2026, driven by the year-on-year turning positive of PPI, the upward cycle showed signs of obvious acceleration. In the inaugural year of the "15th Five-Year Plan", machine tools were listed as a field for tackling key problems with extraordinary measures, and the localization rate of high-end CNC machine tools is still climbing: according to data from CIC Consulting, the localization rate of 5-axis CNC machine tools was 59.5% in 2025, of which the aerospace field was about 54.6%, and there is still a large room for substitution of core functional components.
The keyword for Guosheng Intelligence Technology's strategy this year is "internal and external synergy." Externally, it revolves around market expansion and customer value; internally, it focuses on technological breakthroughs, production and sales enhancement, and cost refinement. Specific initiatives include laying out emerging tracks, promoting the independent and controllable development of core components, and implementing capacity construction. An easily overlooked signal is that the company's net cash flow from operating activities increased significantly by 63.91% year-on-year, indicating that while revenue is growing, the quality of cash collection is also improving, which is a positive sign in the equipment manufacturing industry.
04. Several Hurdles to Watch Out For
Rationally speaking, the risks in front of Guosheng Intelligence Technology are also real.
First, some core functional components still rely on imports to a certain extent, and the localization of key components such as 5-axis rotary tables and 5-axis swing heads is still in the stage of mass production application and verification. Geopolitical uncertainties mean that the supply stability of key components is always a sword hanging over the head. The level to which the rate of independent and controllable development can be raised is directly related to whether the company's long-term earnings quality can step onto a new level.
Second, the competitive landscape in the machine tool industry is not relaxed. The company faces not only products from traditional machine tool powerhouses such as Germany and Japan, but also a group of medium- and high-end CNC machine tool enterprises that have risen rapidly in China in recent years. Customers in the high-end market have extremely high requirements for equipment precision, stability, and long-term service capabilities, and the establishment of brand trust requires time accumulation.
In addition, in the first half of 2026, operating costs increased by 14.90% year-on-year, slightly higher than the revenue growth rate, and the stability of the gross profit margin still needs continuous tracking. In terms of raw material prices, the company frankly admitted that "the impact of fluctuations in some raw materials on the company's profits is controllable," rather than "having no impact."
Guosheng Intelligence Technology is not the kind of company that can make people's blood boil just by telling a grand story. Its value lies in connecting the machine tool industry chain from top to bottom—from casting to precision sheet metal, from functional components to complete machine assembly and then to automated production line integration, with the entire chain being independently researched and produced. This model has natural advantages in customized delivery and quality control, but it also means heavier assets and an expansion pace more constrained by capacity. For investors focusing on the main line of domestic substitution of machine tools, it is worth putting on the watch list, but it requires patience to track two key variables: the progress of localization of core functional components, and the pace of orders in emerging fields moving from "application" to "volume growth."
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