80 billion A-share leader, controlling shareholder placed under detention and investigation!

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On the evening of March 22, Sanan Optoelectronics (600703) announced that on March 21, 2026, the company received notice from its controlling shareholder, Fujian Sanan Group Co., Ltd. (hereinafter referred to as “Sanan Group”), that its actual controller, Lin Xiucheng, has been detained and placed under investigation by the National Supervisory Commission.

Sanan Optoelectronics stated that Lin Xiucheng has not held any position in the company since July 10, 2017. Currently, the company’s production, operations, and management are normal, with a complete organizational structure and governance system. The above matter will not have a significant impact on the company’s operations. Going forward, the company will continue to monitor the situation and fulfill its information disclosure obligations as required.

As of now, Sanan Optoelectronics has a total market value of approximately 82.5 billion yuan, with the latest stock price at 16.54 yuan per share.

Public information shows that Lin Xiucheng is the founder of Sanan Group and has served as Chairman and General Manager of Fujian Sanan Group Co., Ltd. since October 1992. Early in his career, he started in steel trading, earning his first fortune through scrap steel transactions. He then co-founded Sanan Group with the Sanming Steel Factory, establishing the initial industrial foundation. In 2000, Lin Xiucheng began transforming the business, investing heavily in the LED optoelectronics industry. In 2008, Sanan Optoelectronics went public through a backdoor listing via Tanyi Technology.

After the backdoor listing, Lin Xiucheng served as Chairman of the listed company for a long time until July 2017, when he stepped down during a board reshuffle. His son, Lin Zhiqiang, succeeded him as Chairman, completing the second-generation leadership transition.

Currently, Sanan Group directly holds 5.14% of the listed company’s shares and, through its subsidiary Sanan Electronics, holds 24.33%, making it an indirect controlling shareholder. Lin Xiucheng directly owns 59.68% of Sanan Group, and together with his son Lin Zhiqiang, they hold a total of 71.83% of Sanan Group, making them the actual controllers of the listed company. According to the 2026 Hurun Global Rich List, Lin Xiucheng and Lin Zhiqiang have a combined wealth of 16 billion yuan, ranking third among wealthy individuals in Xiamen.

Sanan Optoelectronics mainly engages in the research, development, production, and sales of compound semiconductor materials and devices, focusing on epitaxial wafers and chips involving new compound semiconductor materials such as sapphire, gallium arsenide, gallium nitride, silicon carbide, indium phosphide, and aluminum nitride.

Notably, Sanan Optoelectronics may incur its first loss since its backdoor listing in 2025. The earnings forecast shows the company expects a net profit of -200 million to -400 million yuan in 2025; after deducting non-recurring gains and losses, the net profit is expected to be -750 million to -850 million yuan.

Regarding the reasons for the loss, Sanan Optoelectronics stated: on one hand, the proportion of high-end LED products has increased, and although revenue and profitability from the integrated circuit business have improved year-on-year, the filter and silicon carbide segments still drag down overall profits; on the other hand, government subsidies received decreased year-on-year, R&D expenses increased, and sales of precious metal waste at temporarily agreed prices diverged from Shanghai Gold Exchange prices, reducing investment income. Meanwhile, the company increased provisions for inventory impairments below net realizable value, further lowering profits.

Looking ahead, Sanan Optoelectronics plans to focus on two main areas: first, continue to increase the proportion of high-end LED products; second, accelerate the expansion of the integrated circuit business to quickly enhance sales scale and profitability. In the integrated circuit field, the company’s optical technology capacity is 2,750 wafers per month, with core process steps expanded to 6,000 wafers per month. Additionally, the company is one of the few vertically integrated silicon carbide manufacturing platforms in China, with its subsidiary Hunan Sanan possessing 16,000 wafers per month of 6-inch silicon carbide capacity, 1,000 wafers per month of 8-inch silicon carbide substrates, 2,000 wafers per month of epitaxial capacity, and an 8-inch silicon carbide chip production line that is operational.