On July 11, Shandong Bohui Paper Industry Co.,Ltd. (600966.SH) announced that its indirect controlling shareholder, Gold Paper (China) Investment Co., Ltd. (referred to as "Gold Paper"), intends to extend the deadline for fulfilling its commitment to resolve business competition issues by another six years.
Looking back, on January 7, 2020, the company disclosed that Gold Paper gained indirect control of Bohui Paper by acquiring a 100% stake in Bohui Group. This merger of "paper industry giants" sparked market optimism about consolidation and synergy in the white cardboard sector. At that time, Gold Paper committed to resolving overlapping business operations with the listed company within six years of completing the acquisition. Now, as that six-year deadline approaches, what has arrived is another six-year "grace period."
The reasons given for the extension in the announcement are clear and pragmatic: the competing assets are substantial in scale, and a hasty injection could impose significant funding and debt pressure on the listed company. Furthermore, the independence and compliance of the relevant assets still require rectification. It is noted that behind this stalled integration, Bohui Paper itself is under profit pressure and carries high debt. Amid these multiple negative factors, Bohui Paper's stock price fell 6.94% on July 12.
Extension of Commitment Triggers Stock Decline
Gold Paper's decision to postpone its commitment was not entirely unexpected. As early as December 22, 2025, investors inquired on an interactive platform about a potential extension as the six-year deadline neared, to which the company responded only that it was "maintaining close communication with the controlling shareholder." The reasons for the delay are twofold: the competing assets are large in scale, making a restructuring financially burdensome, and these assets currently cannot fully meet the independence requirements for injection into the listed company.
On January 7, 2020, the company announced that Gold Paper, through a share transfer agreement with Yang Yanliang and his wife, acquired a 100% stake in Bohui Group, thereby indirectly controlling 28.84% of the listed company's shares. Combined with the 20.00% stake held by Ningbo Asia Paper Tube & Carton Co., Ltd. (later restructured as Ningbo Jinjiayuan Paper Industry Co., Ltd.), the total shareholding reached 48.84%, making Gold Paper the indirect controlling shareholder. On August 26 of the same year, the company published a tender offer report. Gold Paper issued a general offer for all unrestricted shares not held by concert parties and simultaneously submitted a "Letter of Commitment on Avoiding Business Competition," explicitly pledging to gradually resolve overlapping business issues within six years post-acquisition.
From a business structure perspective, the competitive overlap primarily lies in white paperboard and offset paper. In 2025, Bohui Paper's revenue from white paperboard reached 11.8 billion yuan, while cultural paper, represented by offset paper, contributed 4.776 billion yuan, indicating a considerable scale of overlapping operations.
The announcement disclosed that Gold Paper's similar assets are even larger in scale. Injecting them via cash acquisition or share issuance would not only significantly increase the listed company's financial leverage and debt burden but could also impact stock liquidity. Additionally, these assets have not yet formed independent operating entities and require systematic improvements in business segmentation, financial independence, and internal control systems, making them far from ready in the short term.
While these explanations have a practical basis, they have not fully alleviated market concerns about the commitment's execution efficiency. Six years ago, Gold Paper stated it would promote integration in steps based on asset profitability and compliance, emphasizing its strong capability as an industry leader to fulfill commitments. However, not only has there been no substantial progress in integration to date, but even the basic independent operating conditions for the assets intended for injection have not been met, inevitably raising questions about the prudence of the earlier optimistic assessment.
It is noteworthy that Gold Paper's extension announcement also listed several alternative approaches, including continuing to study the feasibility of asset injection, seeking high-quality asset swaps, and introducing strategic investors. However, these paths are currently in preliminary research stages, lacking clear execution timelines or implementation guarantees. They appear more as strategic arrangements to extend the transition period. For investors hoping for valuation improvement through integration effects, the foundation for positive expectations remains weak. On July 12, the company's stock price fell 6.94%, offering an initial glimpse of market sentiment.
Profit Pressure and High Debt Weigh on Operations
The extension of the non-competition commitment brings Bohui Paper's persistently weak operational performance back into focus. Once a company the market had high hopes for, expecting rapid growth with Gold Paper's resource support, it has not only failed to achieve a leap forward but appears increasingly burdened under dual pressures of shrinking profits and high debt.
In terms of operational performance, the company's full-year 2025 revenue was 19.158 billion yuan, a slight year-on-year increase of 1.20%. However, net profit attributable to shareholders fell 11.56% year-on-year to 155 million yuan, marking the lowest profit level in nearly five years. Entering 2026, first-quarter revenue was 4.460 billion yuan, down 2.27% year-on-year, indicating continued pressure on the top line. Although net profit attributable to shareholders saw a small year-on-year rebound of 3.75% to 55 million yuan, the absolute size remains modest, with limited improvement in profitability.
Structural challenges within the industry further amplify the difficulty of the company's operational recovery. Since July 2026, paper manufacturers have initiated a new round of intensive price hikes, but the strength and sustainability of this price recovery remain to be seen. Taking Bohui Paper's core revenue source, white cardboard, as an example, although paper prices recorded a slight increase in June, overall prices remain within the low range of the past five years.
According to SCI99 calculations, using current imported wood pulp prices as a benchmark, the white cardboard industry as a whole is still operating at a loss, with the industry's gross profit margin down 0.91 percentage points year-on-year. Although the price of the main raw material, wood pulp, showed a downward trend in June, reducing the average monthly cost of white cardboard by 1.07% month-on-month and correspondingly driving the gross profit margin up 2.25 percentage points compared to the previous month, the overall relief from cost pressure is limited. The industry's low-profit pattern has not fundamentally reversed.
Compared to the periodic fluctuations on the income statement, risks on the balance sheet are more concerning. As of the end of 2025, the company's asset-liability ratio had risen to 65.48%, climbing further to 69.53% in the first quarter of 2026, significantly higher than the industry average. In terms of debt structure, current liabilities dominate, with short-term borrowings reaching as high as 7.5 billion yuan. Meanwhile, the company's cash on hand was only 4.604 billion yuan, leaving a gap of nearly 3 billion yuan and posing a significant test for short-term solvency.
The extension proposal still requires approval at a shareholders' meeting, where related shareholders will abstain from voting. From one "six years" to another, the controlling shareholder's integration commitment remains pending, while Bohui Paper's profit pressure and debt burden are immediate realities. Distant water cannot quench present thirst. How to enhance the company's own operational strength and effectively protect the interests of minority shareholders is an unavoidable question for management.
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