Shangwei New Materials: The Truth Lies Hidden in the Annual Report Inquiry Letter

What information deserves the most attention between the release of the annual and first-quarter reports—and before the semi-annual report arrives? The annual report inquiry letter. Both the Shanghai Stock Exchange (SSE) and the Shenzhen Stock Exchange (SZSE) issue annual report inquiry letters based on urgency, prioritizing matters according to severity. Companies receiving such letters immediately are effectively signaling to investors—especially retail investors—that significant risks may exist here. On May 13, 2026, Shangwei New Materials released two announcements simultaneously: one titled “Reply Announcement Regarding the SSE’s Inquiry Letter on Information Disclosure in the 2025 Annual Report,” and another—a special verification statement issued by Rongcheng Certified Public Accountants—addressing matters subject to audit verification. The fact that these two documents appeared together itself signals a critical point: the SSE has exhibited far more than routine concern regarding Shangwei New Materials’ 2025 annual report—a company listed on the STAR Market. What are the core concerns raised in the inquiry letter? Regulatory authorities focused on three key issues: (1) corporate governance following the change in control; (2) unfulfilled performance commitments; and (3) unpaid performance compensation. These three issues entangled Shangwei New Materials’ 2025 financial statements like three tightening ropes. Even more worrying is the company’s Q1 2026 performance: revenue reached RMB 418 million, up 13.23% year-on-year, yet net profit attributable to shareholders plunged 282.12% year-on-year to a loss of RMB 41.07 million. 1 Timeline of the Change in Control: From Agreement Signing to Tender Offer Shangwei New Materials’ change in control traces back to 2025. Shanghai Zhiyuan Hengyue Technology Partnership (Limited Partnership) acquired control of the company via share transfer agreement. According to Huatai United Securities’ ongoing supervision opinion, the entire control transition involved the following key milestones: Time Event Description July 8, 2025 Signing of Share Transfer Agreement Transferor and Zhiyuan Hengyue reached agreement November 25, 2025 Completion of Board Renewal New controlling shareholder assumed actual control December 2025 Completion of Industrial & Commercial Registration Change Actual controller officially changed 2026 Huatai United Ongoing Supervision Supervision period continues monitoring control stability A change in control itself is not problematic. It is common for STAR Market-listed companies to introduce strategic investors and optimize equity structures—standard capital-market operations. The issue arises when such changes are accompanied by performance commitments: original shareholders pledge future operating results to new shareholders, with cash or other forms of compensation required if targets are missed. Shangwei New Materials’ performance commitments were signed precisely against this backdrop—and the 2025 operational results brought this commitment test squarely into public view. According to disclosures in the inquiry reply announcement, the control-change transaction included performance commitment clauses. The committing parties guaranteed the following 2025 performance metrics: Indicator Commitment Amount (RMB 10,000) Actual Achievement (RMB 10,000) Shortfall (RMB 10,000) Net Profit Attributable to Shareholders 6,000 4,109 −1,891 Net Profit Attributable to Shareholders Excluding Non-recurring Gains/Losses 8,000 3,266 −4,734 Source: iFind First, net profit attributable to shareholders: committed at RMB 60 million, actually achieved RMB 41.09 million—shortfall of RMB 18.91 million, completion rate only 68.48%.

Shangwei New Materials Posts H1 Loss of RMB 167 Million! Core New Materials Business Holds Steady, While Robotics Business Continues ‘Burning Cash’

In the second half of 2025, Zhiyuan Robotics acquired control of Shangwei New Materials through share transfers and a partial tender offer. Subsequently, this STAR Market-listed company—originally focused on eco-friendly corrosion-resistant materials, wind turbine blade materials, and composite materials—began expanding into consumer-grade embodied intelligent robotics. Over half a year later, Shangwei New Materials released a semi-annual report clearly reflecting its transformation. The company achieved RMB 803 million in revenue, up 2.42% year-on-year; however, net profit attributable to shareholders was a loss of RMB 167 million, compared to a profit of RMB 29.90 million in the same period last year; net profit excluding non-recurring gains/losses stood at a loss of RMB 169 million. Revenue continued growing, yet profits swung from positive to negative—the surge in R&D spending, especially for the consumer-grade embodied intelligent robotics business, became the most closely watched aspect of this semi-annual report. Notably, Shangwei New Materials’ robotics business has yet to generate any revenue—but it has already launched two products: Qiyuan Q1 and Qiyuan T1—and recorded approximately RMB 200 million in advance payments from customers. Since Zhiyuan’s takeover, what robotics products has Shangwei New Materials launched under its own brand? Can R&D investment ultimately translate into orders and revenue? These questions have now become top priorities for the company’s next phase. The New Materials Core Business Remains the Foundation From the perspective of main operations, Shangwei New Materials’ performance is not poor. Its primary products include eco-friendly high-performance corrosion-resistant materials, wind turbine blade materials, novel composite materials, and circular economy materials. In H1 2026, gross margin for core operations stood at 14.27%, up 0.13 percentage points year-on-year. Among them, revenue from wind turbine blade materials rose 11.89% year-on-year, while revenue from novel composite materials increased 11.10%—the two strongest-performing segments in the first half. Wind turbine blade materials remain one of the company’s most important businesses. As wind turbine large-scale deployment continues, blade dimensions keep increasing, demanding resin materials that simultaneously meet requirements for strength, weather resistance, lightweighting, and construction efficiency. Notably, recyclable wind power materials: the company has been actively promoting applications of recyclable resins in large-scale wind turbine blades. Related 220-meter-class recyclable wind turbine blades have entered mass production or industrialization advancement stages, and the company has disclosed securing bulk supply orders from wind power clients. Against the backdrop of wind turbine scaling, blade lightweighting, and rising demand for circular utilization, recyclable resins hold promising industrial development potential. For Shangwei New Materials, this business is not a new concept introduced post-control-change—it represents a vital extension of the company’s existing materials technology expertise into green, low-carbon domains. Overall, Shangwei New Materials is not experiencing complete stagnation in traditional materials business; rather, it is maintaining relative stability in its legacy operations while shouldering the R&D and expansion costs of its new robotics business. RMB 180 Million in R&D Spending Directed Toward Robotics The most direct reason behind Shangwei New Materials’ sharp H1 profit decline is the rapid increase in R&D expenses. During the reporting period, the company’s R&D expenses totaled approximately RMB 180 million, surging 738.66% year-on-year; R&D expense ratio rose to 22.46%. Of this, R&D investment in the consumer-grade embodied intelligent robotics business amounted to approximately RMB 164 million—accounting for over 90% of the company’s total R&D expenditure.

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