Can Door Handles Be a Goldmine? Hushan Industrial Goes Public with Astonishingly High Gross Margins

Hushan Industrial Co., Ltd. (7736), the global leader in aftermarket (AM) automotive door handles, has officially entered the capital market. The Taiwan Stock Exchange announced that the company's common stock will be listed for trading on March 18, 2025, making it the fourth domestic company to go public this year. For the first five trading days, there will be no price fluctuation limits.

Founded in 1972, Hushan Industrial has been deeply engaged in the global automotive aftermarket, offering a wide range of products, including door handles, automotive cameras, parking sensors, window regulators, and automotive fasteners. The company boasts a product portfolio of over 13,000 part numbers and develops more than 1,000 new products annually, serving over 500 customers in more than 100 countries. Its brand, “HUSHAN,” is highly recognized in the international market, with a strong focus on high-resolution automotive cameras and parking sensors.

For this underwriting case, Hushan Industrial adopted an 80% auction and 20% public subscription approach. In the auction segment, a total of 4,931 shares were released, with the computer bidding process completed on March 4. The lowest winning bid was NT$110, the highest was NT$168, and the weighted average price was NT$112.57. The public subscription segment offered a total of 1,432 shares at NT$83.80 per share, with the subscription period running from March 6 to March 10, followed by a public lottery draw on March 12.

According to publicly available financial data, Hushan Industrial’s pre-tax net profit for 2024 reached NT$374 million, with earnings per share (EPS) of NT$4.34, demonstrating strong profitability. Benefiting from the global increase in vehicle ownership and rising new car prices driving demand in the repair market, aftermarket (AM) parts offer a significant price advantage over original equipment (OE) parts, typically costing only 30% to 50% of OE parts, further fueling market growth.

Chairman Chen Ying-Chih stated that to meet market demand, Hushan has invested NT$1.2 billion in constructing its fifth factory in Ruifang District, New Taipei City, which is expected to be completed in the first quarter of next year. This expansion aims to further enhance production capacity and extend the company’s business reach. Additionally, Hushan is the only company worldwide to obtain CAPA 702/703 certification from the Certified Automotive Parts Association (CAPA) in the United States, ensuring the quality and competitiveness of its high-resolution automotive cameras and sensors.

Looking ahead, Hushan Industrial is actively promoting its “AM 2.0” product strategy, targeting the mid-to-high-end market with premium upgraded parts. Its sales channels cover insurance companies, aftermarket repair shops, and modification retail stores, with gross margins reaching 40%-50%, significantly higher than those of OE and traditional AM parts. Embracing the "Beyond OE" concept, the company is committed to providing products that surpass original equipment quality, ensuring its continued leadership in the global AM market.