Longi Environmental Protection's state-owned shareholder observed the market at a low point for three months before increasing holdings. The company's controlling shareholder, Zijin Mining, previously made large-scale low-cost purchases.

What is the connection between Zijin Mining’s low-level bottom fishing and Longyan State Investment’s operations?

Reporter: Yan Fengfeng Editor: Wu Yongjiu

In June 2025, when the stock price of Longjian Environmental was lingering at a low level, its important shareholder, Longyan State-owned Assets Investment and Operation Co., Ltd. (hereinafter referred to as Longyan State Investment), promptly announced a plan to increase its holdings by up to 235 million yuan. However, during the subsequent three-month golden window period, Longyan State Investment remained inactive and did not purchase a single share. It wasn’t until the company’s stock price began to rise that it started to buy heavily at high prices, ultimately spending nearly 200 million yuan at an average price over 30% higher than the lower level.

It is noteworthy that before Longyan State Investment announced its plan to increase holdings, the controlling shareholder of Longjian Environmental, mining giant Zijin Mining, had already completed a large-scale acquisition at a relatively low price. Subsequently, Zijin Mining fully participated in Longjian Environmental’s private placement plan with an investment of 2 billion yuan.

Timely increase plan and delayed purchase

On March 25, 2026, Longjian Environmental, a listed company on the Shanghai Stock Exchange, announced that its shareholder Longyan State Investment and its concerted parties had completed the increase plan.

Longjian Environmental disclosed Longyan State Investment’s increase plan on June 10, 2025. The company’s shareholder holding more than 5%, Longyan State Investment, and its concerted action party, Longyan Huasheng Enterprise Investment Co., Ltd., planned to increase the company’s A-share holdings through centralized bidding transactions in the next 12 months, with a total amount not less than 117.5 million yuan and not exceeding 235 million yuan.

By March 24, 2026, the implementation of the increase plan was completed. Longyan State Investment accumulated a total of 11,681,200 shares through its own and specialized loan funds via centralized bidding, accounting for 0.92% of the company’s total share capital, with a cumulative increase amount of 199.9808 million yuan. After the increase was completed, the combined shareholding ratio of Longyan State Investment and its concerted parties rose from 8.00% to 8.92%.

However, this seemingly routine shareholder increase announcement is underpinned by an unusual path taken by the state-owned shareholder: Longyan State Investment announced the increase plan when the stock price was relatively low but delayed the actual purchase until the stock price rose to a relatively high level.

Looking back at the time when Longyan State Investment’s increase plan was released, Longjian Environmental’s stock price was relatively sluggish and was at a low point over the past six months.

In the three months following the announcement of the increase plan, the stock price of Longjian Environmental generally remained relatively low. Data shows that from June 10, 2025, to September 10, 2025, the company’s stock price fluctuated between 11.5 yuan and 12.94 yuan, with an average price of about 12.23 yuan during this period.

However, Longyan State Investment did not choose to buy Longjian Environmental at this relatively low level. According to Tonghuashun data, Longyan State Investment’s shareholding at the end of September 2025 remained at 100,371,300 shares, consistent with the number of shares before the announcement of the increase plan.

It wasn’t until November 22, 2025, that Longjian Environmental announced the progress of the increase: As of November 21, 2025, Longyan State Investment had cumulatively increased its A-share holdings by 7,454,200 shares through centralized bidding, accounting for 0.59% of the company’s total share capital, corresponding to an increase amount of 120.0986 million yuan. By this time, Longjian Environmental’s stock price had already risen significantly, with Longyan State Investment’s average purchase price around 16.11 yuan per share, which was 31.73% higher than the average price of 12.23 yuan three months after the announcement of the increase plan.

By March 24, 2026, Longyan State Investment completed the increase, with the average purchase price further rising to 17.12 yuan, a 39.9% increase compared to the average price of 12.23 yuan three months after the announcement of the increase plan. As of March 25, Longjian Environmental’s stock price closed at 18.63 yuan.

This operation of remaining inactive at low levels and then buying at high prices contradicts the typical market expectation of shareholders increasing their holdings at low levels to stabilize stock prices, raising questions about its investment decision logic.

Controlling shareholder Zijin Mining had previously made large-scale bottom fishing

So what is the relationship between Longyan State Investment and Longjian Environmental?

Public information shows that Longyan State Investment was established in 2002, with a registered capital of about 289 million yuan. Its controlling shareholder is Longyan Investment Development Group Co., Ltd., and the ultimate actual controller is the Longyan State-owned Assets Supervision and Administration Commission. As a local state-owned enterprise in Longyan, Longyan State Investment has long held shares in Longjian Environmental. Before this increase, it had already held 7.90% of the company’s shares. Longjian Environmental, on the other hand, is a leading environmental equipment company that has grown and successfully gone public from Longyan City, undoubtedly a key enterprise in the region.

However, the controlling shareholder of Longjian Environmental is more famous, being Zijin Mining, which once had a market value exceeding 1 trillion yuan. As of the end of 2025, Zijin Mining directly held 21.08% of Longjian Environmental’s shares. The actual controllers of Longjian Environmental and Zijin Mining are both the Finance Bureau of Shanghang County in Longyan City.

In fact, before Longyan State Investment’s increase, Zijin Mining had already made large-scale acquisitions of Longjian Environmental. Between September 2024 and February 2025, when the company’s stock price was fluctuating in a low range, Zijin Mining accumulated purchases of 53,122,900 shares of Longjian Environmental through block trades and centralized bidding, accounting for about 4.2% of the current share capital. However, during this period, due to the conversion of convertible bonds, Zijin Mining’s direct shareholding ratio only increased by 1.23%. At that time, Longjian Environmental’s stock price mostly fluctuated in the range of 11 to 13.5 yuan (after adjustment), which is significantly lower than the average purchase price of Longyan State Investment.

In the later period, Zijin Mining’s shareholding in Longjian Environmental will further increase. On October 24, 2025, Longjian Environmental announced a private placement plan, intending to raise 2 billion yuan through a private placement to its controlling shareholder Zijin Mining, with a targeted issuance price of 11.91 yuan per share, all intended for replenishing working capital.

So why did Longyan State Investment wait until the stock price of Longjian Environmental rose to a relatively high level to increase its holdings instead of buying at a relatively low level? Is there a connection between Longyan State Investment’s increase and Zijin Mining’s increase and participation in private placement? To this, a reporter from the Daily Economic News sent an interview email to Longjian Environmental, but as of the time of publication, no response had been received.

Daily Economic News