Industrial giant Shuanghuan divests robotic gear unit for IPO on China bourse

Of all the revenue streams, gear reducers have been a particular bright spot, whose income spiked 66.35% year on year and made up 8.56% of the total revenue.

Shuanghuan Company (双环传动, 002472.SZ), a domestic leader in precision motors and gear reductions, announced recently that it plans to spin off the subsidiary Fine Motion Technology (环动科技) for an IPO on China’s A-share market.

In an exchange filing on September 25, Shuanghuan Company said its board had agreed to divesting the majority-owned unit to list it separately on a domestic stock exchange.

The parent, which has been around for over 40 years, has also authorized Fine Motion Technology and its management to prepare the paperwork beforehand, the filing said.

Information from Qichacha, a business data search service provider, shows that Fine Motion Technology was founded in May 2020 and specializes in the manufacturing of high-precision gear reductions tailored to robot joints, development and commercialization of high-precision hydraulic parts, design of gearbox and transmission system, among other technologies.

According to Shuanghuan, the divestment and planned IPO will not cause it to lose control of the affiliate.

Nor will it have any negative implications for its other subsidiaries, or hurt its status as an independent public firm and profitability, the filing discloses.

As of the time of the filing, Shuanghuan held a 61.29% stake in Fine Motion Technology.

Steady substitution for foreign imports

Amid a growing inclination to replace foreign imports with domestic robotic components in recent years, the gear reduction business has made ever bigger contributions to Shuanghuan’s revenue.

According to its financial report for the first half of this year, Shuanghuan recorded revenue of 3.68 billion yuan (US$504 million), up 18.99% year on year. Its main business surged 23.35% over a year earlier to 3.16 billion yuan.

During the same reporting period, the Hangzhou-headquartered company reported a net profit of 369 million yuan, up by a whopping 46.89% from the same period last year.

Of all the revenue streams, gear reducers have been a particular bright spot, whose income spiked 66.35% year on year and made up 8.56% of the total revenue.

Fine Motion Technology has been dedicated to the development of robotic joint and precision geare reduction since its founding in 2020.

More shakeups and consolidations on the way

Public records show that the firm’s products mainly include RV reducer, harmonic reducer and more.

Catering to robots with payloads from 3kg to 1,000 kg, they are widely adopted in the high-end manufacturing segment such as industrial robot, cobot, legged robot and industrial automation equipment.

The gear reduction industry in China, albeit relatively small compared to that of Japan, a dominant player, is bracing for more shakeup and consolidation, said GGII, a robot- and automation-focused research institute.

It added that downstream clients, especially established ones, are more likely to purchase robotic parts from bigger corporations, banking on better quality and services.

“Industrial resources will further gravitate toward the leaders,” GGII noted.

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Ni Tao

Ni Tao is the founder and editor-in-chief of cnrobopedia. Prior to cnrobopedia, he had a full decade of experience with a major state-run English-language newspaper as a tech reporter and opinion writer. He is also a communications specialist, having provided consultancy services to established firms like Siemens, Philips, ABinBev, Diageo, Group (Nasdaq: TCOM, HK: 9961), Jianpu Technology (NYSE: JT) and a handful of domestic startups. A graduate of Fudan University, he writes widely about China's business and tech scenes and other topics for global publications including South China Morning Post, SupChina, The Diplomat, CGTN, Banking Technology, among others, and tries to impart his experience to students at Fudan University Journalism School, where he is a part-time lecturer. When he's not writing about robotics, you can expect him to be on his beloved Yanagisawa saxophones, trying to play some jazz riffs, often in vain and occasionally against the protests of an angry neighbor. Get in touch with him by dropping a line at

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