Shandong Fengyuan Chemical Co., Ltd. (hereinafter referred to as the "Company" or "Fengyuan Shares") is a company listed on the Shenzhen Stock Exchange. To meet the capital needs for the Company's business development, enhance its capital strength, and improve its profitability, in accordance with the "Company Law," "Securities Law," "Articles of Association," and "Administrative Measures for the Registration of Issuance of Securities by Listed Companies," and other relevant laws, regulations, and normative documents, the Company plans to issue A shares to specific objects (hereinafter referred to as the "Current Issuance") to raise funds not exceeding RMB 1,428 million (inclusive).
(Unless otherwise specified in this report, the terminology used herein has the same meaning as defined in the "Shandong Fengyuan Chemical Co., Ltd. 2026 Annual Plan for Issuance of A Shares to Specific Objects.")
I. Background and Objectives of the Current Issuance
(I) Background of the Current Issuance
- Implementing the "Dual Carbon" Goals and Promoting the Rapid Development of the Lithium Battery Downstream New Energy Vehicle and Energy Storage Industries
With the increasing prominence of global ecological and environmental issues and the severe climate change situation, the transition to clean energy has become an international consensus. China's "14th Five-Year Plan" has listed climate change response as a national strategy, clearly proposing to achieve carbon peaking before 2030 and carbon neutrality before 2060. The "15th Five-Year Plan" continues to prioritize climate change response as a national strategy, explicitly aiming to achieve carbon peaking and carbon neutrality as a driving force for a comprehensive shift to dual control of total carbon emissions and intensity. The EU's "European Climate Law" and other policy documents require member states to reduce greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels and aim to achieve carbon neutrality by 2050. The United States has rejoined the "Paris Agreement" and set a target for new energy vehicles to account for 50% of sales by 2030, while also committing to carbon neutrality by 2050. The UK has also enacted relevant legislation, establishing a goal of achieving net-zero emissions by 2050 (a 100% reduction compared to 1990).
In key areas of carbon reduction, the clean energy transition in transportation, industrial production, and power generation is imperative. Emission reduction in transportation primarily relies on improving the electrification of vehicles. The industrial production sector still relies heavily on fossil fuels, but the application scenarios for electrification are expected to expand continuously in the future. The power generation sector will significantly increase the proportion of new energy sources such as solar and wind power. Complementary energy storage facilities, which can smooth out the fluctuations and intermittency of new energy generation, are also experiencing rapid growth, driving the development of energy storage technologies towards lower costs, longer lifespans, higher safety, and greater energy density. As the trend towards clean energy becomes increasingly clear across society, the prospects for the new energy vehicle and energy storage industries are broad, leading to a continuous increase in market demand for upstream lithium batteries and their key materials.
- The New Energy Vehicle Industry Has Broad Prospects, Driving Rapid Growth in Demand for Power Batteries
China's new energy vehicle industry has entered a phase of large-scale development, and industry players have reached a consensus on its development prospects, accelerating capacity expansion to capture market share. According to data from the China Association of Automobile Manufacturers, China's new energy vehicle sales are projected to reach 16.49 million units in 2025, a year-on-year increase of 28.2%, with a market penetration rate of 47.9%, marking the eleventh consecutive year of leading the global market. Despite the complete withdrawal of purchase subsidies for new energy vehicles, as the industry matures, growth has shifted from policy-driven to market consumption-driven, demonstrating strong market resilience.