Is Dongpeng Holdings' tile business struggling? Hongshan Kundei has again reduced its stake.

In this round of industry downturn, Dongpeng Holdings’ profitability continues to decline. Investment Times & Benchmark Finance Researcher Dong Lin The development of the ceramic tile industry is closely tied to the real estate sector. In recent years, the real estate industry has remained sluggish. According to data from the National Bureau of Statistics, in 2024, the total floor area under construction by real estate developers stood at 733.247 million square meters—a 12.7% year-on-year decline; new construction starts totaled 73.893 million square meters, down 23.0% year-on-year. Against this backdrop, Guangdong Dongpeng Holding Co., Ltd. (hereinafter “Dongpeng Holdings,” stock code: 003012.SZ), a leading domestic ceramic enterprise, has seen its operating performance continue to deteriorate—and it cannot avoid shareholder share reductions. One month ago, Dongpeng Holdings issued a pre-disclosure announcement on shareholder share reduction, stating that its shareholders HSG Growth I Holdco B Ltd. (“HSG Holdco B”) and Beijing Hongshan Kundei Investment Management Center (Limited Partnership)–Shanghai Zhe De Investment Center (Limited Partnership) (“Shanghai Zhe De”) plan to collectively reduce their holdings by no more than 1.5% of the company’s total share capital—approximately 16.88 million shares—via centralized bidding or block trades between June 4 and September 2, 2025. On June 24, Dongpeng Holdings disclosed the progress of the above-mentioned share reduction. From June 5 to June 23, 2025, HSG Holdco B and Shanghai Zhe De collectively reduced approximately 7.7495 million shares via centralized bidding and block trades, representing 0.6698% of the company’s current total share capital. Following this reduction, the combined shareholding ratio of the two shareholders dropped to 5% (excluding treasury shares), falling below 5% for the first time; their equity change exceeded 1%. Previously, Shanghai Zhe De had already conducted multiple rounds of share reductions in the company. In the secondary market, during the period of these shareholder reductions, Dongpeng Holdings’ stock price fell by 4.96%. As of the close on June 26, the stock declined 0.35% to RMB 5.69 per share (unadjusted), with a current market capitalization of RMB 6.6 billion—down 76% cumulatively from its peak in March 2021, and currently trading below its IPO issue price. Specifics of HSG Holdco B and Shanghai Zhe De’s share reductions Source: Company announcements Founded in 2011, Dongpeng Holdings listed on the Shenzhen Stock Exchange in October 2020. Its main product lines cover tiles and sanitary ware. Its tile offerings primarily consist of glazed and unglazed tiles, while its sanitary ware portfolio includes sanitary ceramics and related products. In 2024, Dongpeng Holdings achieved revenue of RMB 6.469 billion, down 16.77% year-on-year; net profit attributable to shareholders was RMB 328 million, down 54.41% year-on-year; and net profit attributable to shareholders after non-recurring gains and losses stood at RMB 300 million, down 55.88% year-on-year. By business segment, in 2024, Dongpeng Holdings generated RMB 5.387 billion and RMB 916 million in revenue from tiles and sanitary ware respectively—down 18.15% and 6.5% year-on-year.

Hongshan China is busy cashing out! Another listed company announces share reduction, valued at nearly RMB 300 million.

Volatility in China’s A-share market and tightening IPO approvals may be exerting pressure on the primary market, prompting Hongshan China to adjust its investment exit strategy. By Chu Xiaoqiang Hongshan China, led by Shen Nanpeng—the so-called “King of Venture Capital”—has again reduced its stake in a listed company. YIRUI Technology and GloryVision, two A-share listed companies, separately announced on the same day that shareholders planned to reduce their stakes—with both announcements implicating Hongshan China. Both companies stated in their announcements that the share reductions were driven by the shareholders’ own funding needs and would not materially impact the companies’ governance structures or ongoing operations. However, on the first trading day following the announcements (August 5), both YIRUI Technology and GloryVision saw sharp stock price declines. YIRUI Technology’s share price fell below RMB 100 that day, closing down 6.17%; GloryVision closed at RMB 10.90, down 6.2%. In fact, since the second half of last year, Hongshan China has frequently reduced stakes in listed companies, conducting intensive share reductions across multiple firms—including Meituan, in which it had invested for over a decade. Even Shen Nanpeng himself stepped down from his long-held position as a director of Meituan. “Hongshan China’s intensive share reductions in listed companies likely reflect multiple considerations—including realizing investment returns, adjusting investment strategies, and responding to changing market conditions. As one of the world’s top-tier venture capital firms, Hongshan China’s share reduction decisions are presumably based on assessments of market trends and portfolio optimization. Meanwhile, such reductions may also aim to meet LPs’ (limited partners’) funding requirements or other strategic objectives,” said Bai Wenxi, Vice Chairman of the China Enterprise Capital Alliance, in remarks to Shanhai New Finance. 01 Another Share Reduction Plan Announced On August 3, YIRUI Technology announced that Tianjin Hongshan Juye Equity Investment Partnership (Limited Partnership) (“Tianjin Hongshan”) and Beijing Hongshan Xinyuan Equity Investment Center (Limited Partnership) (“Beijing Hongshan”) intend to reduce their holdings via block trades—up to a combined 2.8558 million shares, or no more than 2% of the company’s total share capital. YIRUI Technology debuted on the A-share market in September 2020 and is hailed as the “first digital X-ray detector company” on the STAR Market. Currently, Tianjin Hongshan and Beijing Hongshan jointly hold 10.67% of YIRUI Technology’s shares—acquired prior to its IPO and through post-listing capital reserve conversions. The general partners of Tianjin Hongshan and Beijing Hongshan share a common executing general partner: Sequoia Capital Equity Investment Management (Tianjin) Co., Ltd., whose legal representative is Zhou Kui—a partner at Hongshan China. Image source: Hongshan China official website As of the close on August 6, YIRUI Technology’s share price stood at RMB 101.99, with a total market capitalization of RMB 14.563 billion. At the current share price, the proposed reduction by Hongshan China is valued at nearly RMB 300 million. In fact, this is not Hongshan China’s first reduction in YIRUI Technology. As early as July last year, Hongshan China had announced plans to reduce up to 5% of YIRUI Technology’s shares—but ultimately reduced only 0.89%, raising RMB 273 million. Coincidentally, on the same day YIRUI Technology announced Hongshan China’s share reduction plan, another listed company—GloryVision—disclosed progress on Hongshan China’s reduction of its shares.

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