Securities Code: 002778
Securities Abbreviation: Zhong Sheng High-Tech
Announcement No.: 2026-024
Jiangsu Zhong Sheng High-Tech Environmental Co., Ltd.
Announcement on Establishing Wholly-Owned Subsidiaries and Launching New Projects for External Investment
The Company and all members of its Board of Directors guarantee the truthfulness, accuracy, and completeness of the information disclosed, and that there are no false records, misleading statements, or material omissions.
Special Risk Warning:
Jiangsu Zhong Sheng High-Tech Environmental Co., Ltd. (hereinafter referred to as the "Company") plans to invest RMB 30 million of its own funds or funds raised to establish a wholly-owned subsidiary, "Jing Sheng (Fujian) New Materials Co., Ltd." (tentative name, subject to final approval by the industrial and commercial registration authority), in Jiangyin Town, Fuqing City. Through this subsidiary, it plans to invest in the "Jing Sheng (Fujian) New Materials Polypropylene Deep Processing Project." Additionally, the Company plans to invest RMB 20 million in kind and cash to establish a wholly-owned subsidiary, "Fujian Sheng Hao New Materials Co., Ltd." (tentative name, subject to final approval by the industrial and commercial registration authority), in Luoyuan County, Fuzhou City. Through this subsidiary, it plans to invest in the "High-Performance Polymer Materials Project." Both projects are intended to engage in the production and sales of modified plastic new materials.
The current investment may face the following major risks. Investors are kindly requested to pay close attention and be aware of the investment risks:
- Risks of Business Synergy and Integration
The Company's current main business is environmental protection. This investment in the modified plastic new materials sector involves two business areas with significant differences in industrial attributes and operating models. If the Company's professionals in the new materials sector, technical reserves, and industry judgment capabilities are insufficient, there may be risks of insufficient business synergy, inefficient resource integration, and poor management adaptability during the integration of business operations. This could lead to investment returns falling short of expectations.
- Risks of Industry and Raw Material Price Fluctuations
The modified plastic new materials industry is highly market-oriented and exhibits significant cyclical characteristics. Currently, new production capacity is continuously being released, and the growth of terminal demand is slowing down, leading to increasingly fierce market competition. Product sales prices are highly dependent on the market trends of upstream commodities such as crude oil and various chemical raw materials. Upstream raw material prices are influenced by multiple factors including market supply and demand, energy trends, and macroeconomic policies. The control of production costs for future projects faces significant uncertainty. If the projects cannot adapt to industry cycles, continuously optimize product processes, and align with downstream market demand, the product market competitiveness will be weakened, leading to risks of fluctuating profits and investment returns falling short of expectations.
- Risks of Customers and Orders
The establishment of subsidiaries and the planned investment in modified plastic new materials projects are currently in the preparatory stage, with relatively weak market accumulation and customer resources. There is significant uncertainty in future customer acquisition, order procurement, and fulfillment. The actual order volume, order fulfillment time, and revenue realization may be affected by changes in customer demand and market competition, leading to risks of order acquisition and project operations falling short of expectations.