Trading suspension begins tomorrow! After ten years of being listed, Huayu Mining's controlling shareholder is planning a change of ownership for the first time. Why is the significant expected increase in 2025 performance not enough to prevent the major shareholder from "exiting"?

National Daily Reporter: Cai Ding National Daily Editor: Huang Bowen

After the market close on April 2nd, Huayu Mining (SH601020, stock price 27.85 yuan, market value 22.836 billion yuan) announced that the company received a notice from its controlling shareholder, Tibet Daoheng Investment Co., Ltd. (hereinafter referred to as “Daoheng Investment”), stating that Daoheng Investment is planning a share transfer agreement, which may lead to a change in the company’s control.

The announcement stated that, due to ongoing negotiations regarding the above matter and the existence of uncertainties, to ensure fair information disclosure, protect investors’ interests, and avoid abnormal fluctuations in the company’s stock price, the company applied for a trading halt. Starting from the market open on April 3rd (Friday), the company’s stock will be suspended, with an expected suspension period of no more than five trading days.

It is worth noting that this is the first time Huayu Mining has issued a trading halt announcement since its listing in March 2016 due to a control change planned by its controlling shareholder.

Huayu Mining expects net profit attributable to the parent company in 2025 to grow by over 200%

When a listed company’s controlling shareholder transfers control, the secondary market often associates this with poor company management. However, Huayu Mining’s situation is quite the opposite.

According to the company’s performance forecast disclosed on January 27th for 2025, Huayu Mining expects its net profit attributable to the parent company for the full year of 2025 to reach between 800 million and 900 million yuan, a year-on-year increase of 215.80% to 255.28%; it also expects to achieve a non-recurring profit of 380 million to 480 million yuan, an increase of 50.44% to 90.02% year-on-year.

Regarding the reasons for the projected performance growth in 2025, Huayu Mining stated that during the reporting period, the demand for non-ferrous metals in domestic and international markets was strong, and prices continued to rise. Against this backdrop, the company benefited fully from the sustained prosperity of the precious metals and minor metals markets, which drove a significant year-on-year increase in operating revenue.

The “Daily Economic News” reporter also noted that Huayu Mining’s high valuation for restructuring or acquisitions is mainly due to its possession of strategically significant mineral resources, especially the so-called “industrial MSG” strategic minor metal—antimony.

In recent years, Huayu Mining has actively expanded overseas assets, such as its acquisition of a 50% stake in Tajikistan’s largest state-owned enterprise, “Tajik Aluminum Industry.” The company stated in its 2023 semi-annual report that once the “Tajik Aluminum Industry” project reaches full production, it can produce 16,000 metal tons of antimony concentrate and 2,200 metal tons of gold bars annually.

Public information shows that antimony plays an irreplaceable role in fields such as photovoltaics, military industry, and flame retardants. It is a scarce metal listed in the strategic reserve catalogs of many countries worldwide.

According to Huayu Mining’s 2025 semi-annual report, the “Tajik Aluminum Industry” project was completed and trial-produced in April 2022, and officially started production in July 2022. It has now reached an annual ore processing capacity of 1.5 million tons. The company also stated that the completion and operation of the Tajik Aluminum Industry project marked an important step in its overseas development, enhancing its ability to expand internationally.

Daoheng Investment unpledged 28 million shares in January this year, with past instances of pledge defaults and “passive share reductions” disclosure violations

The reporter noted that Huayu Mining’s controlling shareholder, Daoheng Investment, has long maintained a high proportion of pledged shares.

For example, by the end of 2022, Daoheng Investment pledged shares representing up to 53.44% of Huayu Mining’s shares it held (accounting for 8.69% of the company’s total share capital). Generally, a high pledge ratio by major shareholders is often to meet their own financing and liquidity needs.

It is noteworthy that on January 28, 2026, Huayu Mining announced that Daoheng Investment had unpledged 28 million shares to a natural person, Ye Danrong, on January 27, 2026 (representing 22.44% of its holdings and 3.41% of the company’s total share capital).

After this unpledge of 28 million shares, Daoheng Investment still has 20.56 million shares pledged, accounting for 16.48% of its holdings and 2.51% of Huayu Mining’s total share capital.

Past disclosures also show that Daoheng Investment has experienced pledge defaults and violations related to “passive share reductions.”

For example, in March 2019, Huayu Mining announced that Daoheng Investment’s 171 million shares (accounting for 32.60% of the company’s total share capital at that time) were frozen for three years (from March 2019 to March 2022). Among the frozen shares, 168 million had already been pledged.

Since August 2018, the pledged shares pledged to Haitong Asset Management by Daoheng Investment have continuously fallen below the warning line, constituting a material breach of contract. In July 2019 and subsequent periods, Haitong Asset Management and Haitong Securities forcibly liquidated the pledged shares, leading to multiple “passive reductions” of several million shares by Daoheng Investment.

Regarding these passive share reduction events, because Daoheng Investment failed to disclose its reduction plan 15 trading days in advance as required, it constituted a violation of information disclosure regulations. The Shanghai Stock Exchange issued multiple regulatory notices and public reprimands to Daoheng Investment.

Daily Economic News