A new shareholder appears to have timed the market perfectly with an investment in Hongfa Technology Co.,Ltd. (600885).
On July 6, Hongfa Technology Co.,Ltd. announced that on April 7, 2026, its controlling shareholder, Youge Investment, signed a share transfer agreement with Zhengyue Yufa. The agreement involved the transfer of 77.38 million shares at 23.013 yuan per share, representing 5.00% of the total share capital, for a total transaction value of 1.781 billion yuan. The share transfer confirmation was obtained on July 6, with the transfer date recorded as July 3. Following this transaction, Youge Investment's stake decreased to 20.80%, while Zhengyue Yufa now holds 5.00%. This transfer does not trigger a mandatory offer, and the transferee has committed to not selling the shares within the next 12 months.
Noteworthy Error in Disclosure
It is important to note that the number of shares transferred in the aforementioned announcement was incorrectly stated as 773.8 million shares. This is a basic error; the actual figure should be 77.38 million shares, indicating an extra zero was mistakenly added in the announcement.
Substantial Paper Profit for New Investor
Since the company confirmed the share transfer on April 7, the stock price of Hongfa Technology Co.,Ltd. has been on a consistent upward trajectory. As of the market close on July 6, the cumulative increase has reached 53.22%. Based on the closing price of 38 yuan on July 6, the market value of the transferred shares has soared to approximately 2.94 billion yuan, representing an estimated paper gain of about 1.16 billion yuan for the new shareholder.
Background of the New Shareholder
Corporate records indicate that Zhengyue Yufa was established in 2026 and is based in Xiamen, Fujian Province. It operates primarily in the business services sector with a registered capital of 2 billion yuan. The company's first and second largest shareholders are Xiamen Xiangye Industrial Investment Group Co., Ltd. and Guomao Chuangling (Shanghai) Investment Co., Ltd., both of which are controlled by state-owned assets in Xiamen.
Company's Recent Financial Performance
Public information shows that in 2025, Hongfa Technology Co.,Ltd. reported operating revenue of 17.202 billion yuan, a year-on-year increase of 21.98%. Its net profit attributable to the parent company's owners was 1.758 billion yuan, up 7.76% from the previous year.
For the first quarter of 2026, the company's operating revenue was 5.108 billion yuan, marking a 28.24% increase year-on-year. The net profit attributable to the parent company's owners for the quarter was 484 million yuan, reflecting a growth of 17.80%.
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