Shanghai Hongda New Material Co., Ltd. (hereinafter referred to as "ST Hongda" or "the Company") is a company listed on the Shenzhen Stock Exchange. To improve the Company's management level, enhance its capital strength, improve its financial condition, optimize its capital structure, and strengthen its risk resistance capabilities, the Company, based on its own situation, and in accordance with the "Company Law of the People's Republic of China" (hereinafter referred to as the "Company Law"), the "Securities Law of the People's Republic of China" (hereinafter referred to as the "Securities Law"), the "Administrative Measures for the Registration of Issuance of Securities by Listed Companies" (hereinafter referred to as the "Registration Measures"), and other relevant laws, regulations, and normative documents, plans to raise funds through a private placement of shares to specific objects.
(Unless otherwise specified in this justification analysis report, the terms used herein have the same meaning as in the "Shanghai Hongda New Material Co., Ltd. 2026 Private Placement of A Shares Prospectus".)
I. Background and Objectives of the Private Placement to Specific Objects
(I) Background of the Private Placement to Specific Objects
The Company's main business is the processing and sale of silicone rubber and its products. The Company focuses on the research and development, production, and sales of silicone materials, with its main products being high-temperature silicone rubber, including raw rubber, compounded rubber, and liquid rubber. Silicone rubber, as a material with excellent properties for bonding and sealing, has excellent properties such as physiological inertness, resistance to high and low temperatures, electrical insulation, weather resistance, aging resistance, and hydrophobicity. It is widely used in automotive transportation, electronic appliances, power and new energy, building decoration, medical care, cables, and aerospace and other fields.
- Continued pressure from industry cycle adjustments, and emerging fields bring sustainable development opportunities
The silicone industry is an important pillar industry in the field of high-performance new materials. In recent years, affected by concentrated capacity release and weakening downstream demand, the silicone industry has experienced a volatile downturn, with product prices continuously falling, industry profitability under pressure, and low capacity utilization rates, putting high-cost capacity under pressure to be phased out. Starting from April 2026, China canceled the export tax rebate for value-added tax on products such as organosilicon in primary form. While this brings short-term pain to the industry's development, it is intended to force companies to abandon their reliance on low-end exports and instead focus on niche segments with higher technological barriers. With the development of downstream emerging fields, the demand for silicone in the market is expected to recover and be released. According to Baichuan Yingfu's forecast, the incremental demand from segmented fields such as new energy vehicles, 5G base stations, and electronic power is considerable. At the same time, traditional application fields such as medical care, aerospace, and textile auxiliaries are continuously expanding their innovative application scenarios, jointly driving demand growth. In addition, the growing consensus on "anti-monopoly" within the industry helps to avoid vicious price competition and achieve high-quality sustainable development. These factors, acting together, will bring new development opportunities for the silicone industry.
- The trend of industry concentration is evident, and large-scale development is urgent