RMB 400 million proposal targets a coupling-equipment manufacturer
On the evening of 27 October, Yifei Laser (688646.SH) announced a plan to acquire 100% of Xingqihang Automation Equipment Co., Ltd. for RMB 400 million in cash.
Xingqihang has spent years developing core equipment for optical-module packaging. The proposed industrial acquisition would extend Yifei from conventional laser equipment into high-speed optical communications packaging equipment.
Complementing the equipment portfolio
Yifei’s announcement states that its board of directors has approved the transaction proposal.
With more than a decade of industry experience, Xingqihang focuses on the development and volume production of automated optical-module coupling equipment. Its portfolio covers a full range of product categories and processes.
On the hardware side, the equipment supports mainstream optical-module packaging formats, including TO-CAN, COB, BOX (Lens) and FA fiber arrays.
Its process capabilities include laser welding, ultraviolet adhesive curing and thermal curing, covering the production routes needed for standardised volume manufacturing of conventional optical modules.
For emerging technologies, Xingqihang has completed development of co-packaged optics (CPO) equipment and high-speed coupling equipment for 1.6T and higher rates. This aligns its technical capabilities with current advanced-module development. The company has already served leading global optical-module customers, indicating a relatively mature level of commercialisation.
From an industrial perspective, the proposed acquisition brings complementary capabilities together.
Yifei has established strengths in laser processing and automated production-line integration, while Xingqihang contributes equipment for precision optical coupling and automatic alignment.
Combining the two could move the business from selling individual machines to providing complete automated optical-module packaging lines, substantially broadening the overall offering.
The transaction includes performance commitments. According to the announcement, Xingqihang must generate at least RMB 93 million in cumulative net profit excluding non-recurring items from 2026 to 2028, equivalent to an average of at least RMB 31 million per year.
Combining complementary strengths
Yifei has long worked in intelligent laser equipment, concentrating on the development and production of laser welding and precision-processing automation equipment. Its products are used in power batteries, energy storage, semiconductors and advanced precision manufacturing.
Its core strengths are laser-process optimisation, high-precision motion control and complete-line automation integration. The company provides customised, integrated intelligent manufacturing solutions, supported by accumulated technical expertise and project-delivery experience.
Xingqihang’s principal value lies in its detailed command of key optical-module packaging processes.
Optical coupling is a critical stage in module production, directly affecting optical loss and final yield. It places demanding requirements on equipment precision, control algorithms and optical-path inspection systems.
The sector has high entry barriers and long customer-validation cycles. Once a supplier enters a core supply chain, relationships tend to be durable and business relatively stable.
If the acquisition is completed, the companies’ technology, product and customer resources could be combined. Yifei’s laser welding equipment, together with Xingqihang’s precision coupling and curing equipment, could cover the full optical-module packaging process.
The business model could then expand from supplying individual machines to delivering complete production-line solutions, increasing the value of each project and the ability to serve customers while opening additional profit opportunities.
Technology transitions create new opportunities
Continued expansion of computing infrastructure is accelerating the development of high-speed optical modules.
800G modules have entered volume production. Customer validation and small-batch trials of 1.6T products are progressing, while CPO technologies are also moving towards deployment. The industry is undergoing a rapid upgrade cycle.
Each increase in module speed and each process innovation raises requirements for packaging-equipment alignment precision, multi-channel synchronised control and high-speed coupling. This continues to drive production-line equipment upgrades and replacement.
As high-value core equipment in optical-module production, coupling systems are positioned to benefit from downstream capacity expansion and technology upgrades, with continuing growth in demand.
According to Frost & Sullivan, the global optical coupling-machine market was worth RMB 2.31 billion in 2025 and is expected to reach RMB 15.08 billion by 2030.
Xingqihang’s early development of advanced high-speed packaging equipment positions its technology portfolio for the industry’s next stage.
For Yifei, the proposed acquisition offers a new growth path by applying its established laser and automation technology platform to the optical communications supply chain serving computing infrastructure.
The key issues to watch are the progress of business integration and the companies’ ability to deploy complete-line solutions with customers.
With continued strong downstream demand for computing infrastructure, the high-speed optical-module equipment sector is developing favourably and could provide Yifei with a sustained source of additional business.
This article is based on public information and material provided by interviewees. The completeness and accuracy of that information are not guaranteed. The content does not constitute investment advice under any circumstances. Financial markets involve risk, and investment decisions require care.