As a once high-flying "dark horse" in the photovoltaic industry, Shuangliang Eco-Energy Systems Co., Ltd.'s expansion story had drawn widespread attention. However, this dark horse has suddenly encountered a financial "chasm" on its fast track.
A recent 45-page reply to the Shanghai Stock Exchange's regulatory inquiry revealed the company's complex situation. As of June 2025, ¥5.052 billion of Shuangliang’s ¥5.612 billion in cash reserves were restricted, while its short-term interest-bearing debt exceeded ¥10 billion.
Of particular concern is the "special relationship" between the company’s major clients and suppliers. In H1 2025, "Company B" was both the top customer and the second-largest supplier in Shuangliang’s photovoltaic new energy segment. The company sold ¥453 million worth of silicon wafers and square rods to "Company B" while purchasing ¥279 million in silicon materials from the same entity.
Shuangliang explained that subsidiaries B1–B6 under "Company B" are its clients, while another subsidiary, B7, is its supplier. The company emphasized that pricing for procurement and sales is independent and market-based, ensuring fairness.
Another key client, "Company A," also raised eyebrows. It was Shuangliang’s third-largest customer in 2024 and the second-largest in H1 2025. The company disclosed that a related party of its controlling shareholder jointly invested in a Yangzhou-based firm with a subsidiary of "Company A," though no substantial residential PV business has been conducted yet.
Industry expert Bai Wenxi noted that while regulations do not prohibit such client-supplier overlaps, they must meet three core requirements: genuine transactions, fair pricing, and full disclosure. However, this model carries risks—if the client-supplier faces operational issues or manipulates prices, Shuangliang’s profitability could be squeezed.
**Strategic Pivot Amid Financial Strain** Shuangliang’s business spans energy-saving equipment, new energy systems, and photovoltaic products. Originally an air conditioning installer, it later became a major central air conditioning manufacturer before pivoting to energy conservation and, in 2021, entering the silicon wafer and module sectors.
The company secured massive orders, locking in clients like Trina Solar and Tongwei, amassing ¥90 billion in silicon wafer contracts by 2022. By 2024, PV new energy accounted for 75% of revenue.
Yet, the industry’s cyclical downturn—marked by overcapacity and price wars—has hit hard. In H1 2025, Shuangliang’s PV segment posted a -11.1% gross margin, with ¥1.623 billion in inventory and ¥166 million in write-downs.
**Betting on Hydrogen** Facing losses, Shuangliang is now shifting focus to hydrogen. In October 2025, it scrapped a previous fundraising plan and proposed a downsized ¥1.292 billion private placement, redirecting funds from PV projects to zero-carbon smart factories and hydrogen equipment production.
Under the leadership of founder Miao Shuangda’s son, Miao Wenbin, the company aims to revive profitability through hydrogen tech. However, Q3 2025 results showed a ¥544 million net loss, with revenue down 41.27% YoY.
**Generous Dividends Amid Challenges** Despite current struggles, Shuangliang has richly rewarded the Miao family. Since its 2003 IPO, the company has distributed ¥4.089 billion in dividends—over half of which went to the Miao clan, which holds a combined stake exceeding 50%.
Now at a crossroads, Shuangliang grapples with towering debt, overlapping client-supplier ties, and a precarious cash position. Whether the Miao family can steer its next chapter remains to be seen.
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