Shares of Dongyue Group (00189) have surged more than 10% in today's session. At the time of writing, the stock is up 8.01%, trading at HK$17.13 with a turnover of HK$329 million.
The significant price movement follows the release of a draft policy for the 2027 refrigerant quota system. The proposed quota plan for 2027 is largely consistent with the 2026 scheme. Notably, the conversion of HFC-245fa to other varieties is prohibited, while the upper limit for the conversion ratio of other varieties to HFC-245fa has been raised to 50%.
Analysts suggest that the production quota system and the ongoing improvement in market supply and demand dynamics are expected to drive a recovery in the average price of refrigerants. A recent research report highlighted that Dongyue Group is a leader in second and third-generation refrigerants, commanding a high market share in core products like R22 and R32 and possessing significant industry pricing influence.
The report further noted that third-generation refrigerants still have considerable room for price increases in the long term, from which the company is poised to benefit substantially. It was also pointed out that the robust profits from the refrigerant segment are expected to provide sustained financial support for the research and development of high-end fluorinated materials.
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