On the evening of January 13, Invengo Information Technology Co.,Ltd. (Invengo) released its "Plan for Private Placement of A-Shares in 2026," proposing to raise 690 million yuan for projects including the construction of an RFID electronic tag production line.
Compared to the recently terminated private placement plan, Invengo has doubled the fundraising amount for this offering, significantly increased the planned investment for multiple sub-projects, and added a new "IoT Terminal Construction Project." However, the description of this new project is extremely sparse, raising questions about whether it is a disguised form of supplementing working capital. Furthermore, the total amount allocated for working capital supplementation, combined with contingency reserves and initial working capital, exceeds 30% of the total raised funds, casting doubt on its compliance with regulations.
Notably, this private placement by Invengo bears many traces of involvement from parties controlled by the actual controller. For instance, the "Innovation Industry Center Construction Project" plans to lease factory buildings from a related party, and the implementation site for the RFID electronic tag production line is a property that has been repeatedly bought and sold between Invengo and its actual controller. Shortly before the company announced the private placement plan, its actual controller, Xu Yusuo, unveiled a massive share reduction plan. Since its listing, Xu Yusuo has reduced his holdings by a cumulative amount exceeding 1.1 billion yuan and has also pledged the majority of his listed company shares for financing.
The private placement plan indicates that Invengo intends to issue no more than 221,927,220 shares to no more than 35 specific investors, aiming to raise up to 690 million yuan. The funds are designated for the RFID Electronic Tag Production Line Construction Project, the Innovation Industry Center Construction Project, the RFID Electronic Tag Chip Process Upgrade Project, the IoT Smart Terminal Construction Project, and supplementing working capital, with planned allocations of 190 million yuan, 95 million yuan, 70 million yuan, 135 million yuan, and 200 million yuan respectively.
On September 24, 2025, Invengo announced the termination of a previous private placement plan that aimed to raise 300 million yuan for four sub-projects. Compared to the previous 300 million yuan offering, Invengo's latest plan doubles the total fundraising amount. Furthermore, the funding allocated to all four of the previous sub-projects has been increased, with the amount for supplementing working capital surging by 550% from 30.735 million yuan to 200 million yuan.
Additionally, this 690 million yuan private placement introduces a new sub-project—the IoT Terminal Construction Project—which is slated to use 135 million yuan in raised funds.
The private placement plan provides a very brief introduction to the IoT Terminal Construction Project, stating its basic premise as follows: "This project plans to deploy self-developed IoT terminal equipment in consumer IoT scenarios such as theme parks, famous museums, and iconic cultural attractions, selling customized cultural and creative products deeply integrated with scene IP."
Moreover, the entire private placement plan fails to clarify whether the "IoT Terminal Construction Project" is intended for capacity expansion or research and development. For example, the RFID Electronic Tag Production Line Construction Project explicitly states the intention to build a production line, which upon completion will increase RFID electronic tag production capacity by 2 billion units. Similarly, the Innovation Industry Center Construction Project clearly indicates research and training for vertical application large models and the construction of an intelligent equipment production line. The RFID Electronic Tag Chip Process Upgrade Project also explicitly states that the project content involves developing RFID electronic tag chips.
In contrast, the company's IoT Terminal Construction Project does not specify whether it is for R&D or production expansion; the phrasing suggests the primary action is "deploying" and "selling" products. If the focus were R&D, the subject could be stated as "researching and developing"; if it were capacity expansion, it could explicitly mention building a production line and the resulting capacity increase.
From the "Project Budget" section, investors also find it difficult to discern whether the IoT Terminal Construction Project is for capacity expansion or R&D. Its detailed budget column only contains a single entry for "Project Acquisition and Construction Investment," for which the entire 135 million yuan in raised funds is allocated.
For comparison, Invengo's RFID Electronic Tag Production Line Construction Project, which is clearly for capacity expansion, includes in its investment budget table items such as equipment purchase and installation fees, contingency reserves, and initial working capital, allowing investors to understand it as an expansion project. Similarly, the Innovation Industry Center Construction Project's budget includes factory building rental and renovation costs, equipment purchase costs, contingency reserves, R&D project implementation fees, and initial working capital, indicating a project involving both R&D and production expansion.
The investment budget for the IoT Terminal Construction Project, however, only contains the vague term "Acquisition and Construction Investment," necessitating further disclosure on what exactly is being purchased and constructed.
According to the "Applicable Opinions on Article 9, 10, 11, 13, 40, 57, and 60 of the 'Measures for the Registration-based Administration of Securities Issuance by Listed Companies' - Securities and Futures Legal Application Opinion No. 18" (hereinafter "SFC Legal Opinion No. 18"), "When raising funds through a rights issue, issuance of preferred shares, or a private placement of shares where the board of directors determines the subscribers, all raised funds may be used to supplement working capital and repay debts. For funds raised through other methods, the proportion used to supplement working capital and repay debts shall not exceed thirty percent of the total funds raised."
Based on the above regulation, the proportion of funds from Invengo's private placement used to supplement working capital and repay debts must not exceed 30% of the total raised amount. The company's 200 million yuan for supplementing working capital constitutes approximately 29% of the total 690 million yuan, which is below the 30% threshold.
However, also according to SFC Legal Opinion No. 18, "Funds used for non-capital expenditures such as personnel salaries, payments for goods, contingency reserves, market promotion fees, and initial working capital shall be deemed as supplementing working capital... For construction project classes with a construction period exceeding one year, they are deemed capital expenditures." In Invengo's 690 million yuan private placement, the sum for supplementing working capital, plus the initial working capital and contingency reserves from several sub-projects, amounts to approximately 236 million yuan. This represents about 34% of the total funds raised, exceeding the 30% limit, and its compliance is therefore questionable.
Furthermore, whether the newly added "IoT Terminal Construction Project" involves "non-capital expenditures such as personnel salaries, payments for goods, contingency reserves, market promotion fees, and initial working capital," and whether its construction period exceeds one year, are crucial questions that probe the essential nature of the project—whether it constitutes a form of working capital supplementation. The listed company should provide a detailed explanation to resolve these doubts.
Even if the new "IoT Terminal Construction Project" is not deemed a disguised form of supplementing working capital, its substantial 135 million yuan fundraising allocation indirectly raises the upper limit for Invengo's working capital supplementation amount, as the increased total fundraising raises the corresponding 30% monetary threshold.
Invengo's private placement shows frequent traces of involvement from related parties controlled by the actual controller. For example, in the "Innovation Industry Center Construction Project," the listed company plans to lease factory buildings from the related party Xi'an Invengo IoT Industrial Park Co., Ltd. (hereinafter "Xi'an Industrial Park").
The private placement plan shows that the Innovation Industry Center Construction Project plans to use 94.7617 million yuan in raised funds, of which 8.8985 million yuan is for factory building rental and renovation costs. This nearly 10 million yuan will flow to Xi'an Industrial Park, in which the company's actual controller, Xu Yusuo, holds a 97.1% controlling stake.
Investors may question why Invengo, which already has an industrial park and substantial factory buildings in Kunshan, needs to establish a new industry center project in Xi'an and, furthermore, lease premises from its actual controller. Invengo stated that Xidian University offers rich scientific research resources that can provide R&D support for the project's implementation.
The RFID Electronic Tag Production Line Construction Project in this private placement plans to use 190.339 million yuan in raised funds. The project implementation site is located at the Invengo IoT Industrial Park in Kunshan, Jiangsu Province (hereinafter "Kunshan Industrial Park").
The Kunshan Industrial Park is familiar to investors who follow Invengo. Currently, Kunshan Invengo IoT Industrial Park Co., Ltd. (Kunshan Invengo) is indirectly controlled by Invengo's actual controller, Xu Yusuo, who holds a 98% stake.
In fact, Phase I of the Kunshan IoT Industrial Park (including the land for Factory Buildings F and G, etc.) was initially controlled by the listed company Invengo and was an on-balance-sheet asset. In June 2019, Invengo sold its subsidiary Kunshan Invengo, which owned Phase I of the Kunshan IoT Industrial Park, to Shenzhen Invengo Group Co., Ltd., controlled by actual controller Xu Yusuo, for 213 million yuan.
Interestingly, in April 2020, the listed company repurchased the future-to-be-completed real estate for Factory Buildings F and G held by Kunshan Invengo from a subsidiary controlled by the actual controller for 139 million yuan. This "back-and-forth asset shuffling" between the listed company and entities controlled by the actual controller led to inquiries from the stock exchange regarding "whether there were situations of transferring benefits to the controlling shareholder and whether there were situations of manipulating profits through related-party transactions."
Although Invengo denied issues of benefit transfer or profit manipulation, the company's 2019 transfer of 100% equity in Kunshan Invengo generated investment income of 141.9213 million yuan and a net profit of 122.3123 million yuan. This was significant for Invengo at the time, as it had reported negative net profit after deducting non-recurring items for three consecutive years, potentially leading to special treatment under the delisting rules then in effect. Whether Invengo manipulated profits through related-party transactions remains a matter of investor interpretation.
Shortly before the company announced the private placement plan, Invengo's actual controller, Xu Yusuo, unveiled a substantial share reduction plan. This concurrent occurrence of a plan to issue new shares via private placement and a major reduction plan by the actual controller inevitably raises questions among investors.
On the evening of December 19, 2025, Invengo disclosed a pre-announcement regarding the actual controller's share reduction. The announcement stated that Xu Yusuo planned to reduce his holdings in Invengo by no more than 22,192,722 shares, not exceeding 3% of Invengo's total share capital, within three months starting 15 trading days after the announcement date, through centralized bidding and block trades. Based on Invengo's closing stock price of 7.16 yuan per share on December 19, 2025, Xu Yusuo's planned reduction amounts to approximately 159 million yuan.
According to incomplete statistics, since the company's listing, Xu Yusuo has reduced his holdings by a cumulative amount exceeding 1.1 billion yuan and has also pledged the majority of his Invengo shares for financing.
As of December 12, 2025, Xu Yusuo had pledged 93.22 million shares of the listed company, representing 87.84% of his total holdings in the company—a near-full position pledge.
While the listed company seeks to raise funds from the market through a private placement, its actual controller simultaneously plans to reduce his holdings and cash out due to "personal funding needs," all while his shares are highly pledged. Additionally, the related-party leasing arrangements within the fundraising projects deepen market skepticism regarding this private placement.
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