ShunNa Co., Ltd. shares have increased by over 100% this year, and the controlling shareholder is迎来“debt relief” turning point?

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Source: Global Tiger Financial App

With the stock price doubling this year, ShunNa Co., Ltd.'s strong performance has not only attracted market attention but also unexpectedly unveiled a nearly 10-year-old capital “old account.” As the stock price hits new highs, the debt issue left by a complex leveraged buyout by the company’s controlling shareholder seems to be turning a corner.

On March 17, ShunNa Co., Ltd. saw its stock price hit the daily limit again, with a cumulative increase of over 146% this year. Even though there has been some recent pullback, the cumulative increase is still double.

The recent surge in ShunNa Co., Ltd.'s stock price may be closely related to its core transformer business. With the demand for power infrastructure skyrocketing, as a transformer manufacturer, ShunNa Co., Ltd.'s operating performance has also steadily grown. In the first three quarters of this year, the company achieved a net profit attributable to shareholders of 80.5149 million yuan, a year-on-year increase of 12.94%.

The rising market value of ShunNa Co., Ltd. may enable its controlling shareholder to “settle debts.” In 2016, Guangzhou Huifu Boyan Investment Partnership (hereinafter referred to as “Huifu Boyan”) agreed to acquire 120 million shares of ShunNa Co., Ltd. for 1.55 billion yuan. Of this acquisition funding, 1 billion yuan came from the Guangzhou branch of SPD Bank, while the remaining 550 million yuan came from individual Sun Jiancheng.

According to the announcement at the time, the portion contributed by SPD Bank enjoyed a fixed annualized return of 7.3%, while the remaining income belonged to Sun Jiancheng. However, the problem lies in the close relationship between ShunNa Co., Ltd. and the then P2P giant “Grassroots Investment.” With tightening regulation, Grassroots Investment collapsed in 2018, and the 120 million shares held by Huifu Boyan were judicially frozen.

Now, with the strong rise in ShunNa Co., Ltd.'s stock price, the value of the shares held by Huifu Boyan has risen to 2 billion yuan based on the current market value. This means that SPD Bank, as the priority funding party, may not only recover the full principal but also receive sufficient interest.

ShunNa Co., Ltd.

Double this year

Recently, ShunNa Co., Ltd. has performed exceptionally well in the A-share secondary market, having hit the daily limit six times within ten trading days. As of now, the cumulative increase this year has exceeded 100%, making it one of the hot stocks in the A-share market this year.

The strong upward movement of ShunNa Co., Ltd.'s stock price may be closely related to its core transformer business. As global AI computing power construction enters a period of rapid expansion, the demand for supporting power infrastructure has seen explosive growth, and the prosperity of the transformer sector continues to rise.

According to Citigroup’s estimates for the global high-voltage power transformer market, by 2025, the industry’s supply-demand gap will reach approximately 30%. From 2026 to 2028, the annual supply will continue to fall short of annual demand; the cumulative supply-demand gap will expand from 708 GVA in 2025 to around 1699 GVA by 2028.

In this context, according to data from the General Administration of Customs, by 2025, China’s total value of transformer exports will reach a record 64.6 billion yuan, an increase of nearly 36% from the previous year; the average export price per transformer will rise to 205,000 yuan, an increase of about one-third, with both quantity and price rising.

As a manufacturer deeply engaged in this field, ShunNa Co., Ltd. has the capability to provide full-chain distribution equipment solutions, covering transformers, distribution cabinets, header cabinets, terminal power cabinets, distribution boxes, and supporting DC operating power supplies, among a full range of products.

Especially in the computing power center supporting sector, the company not only maintains cooperation with major data centers in various computing power hub regions such as the Beijing-Tianjin-Hebei, Yangtze River Delta, and Guangdong-Hong Kong-Macao Greater Bay Area, but also for data centers in various export projects.

From a revenue structure perspective, the power transmission and distribution series products are the absolute core income pillar for the company. In the first half of 2025, this sector achieved revenue of 1.07 billion yuan, contributing as much as 99.79% to revenue.

The strong focus on its main business has also laid a solid foundation for performance growth. Data shows that in 2024, the company achieved total operating revenue of 2.42 billion yuan, a year-on-year increase of 17.06%; it achieved a net profit attributable to shareholders of 94.0525 million yuan, a significant year-on-year increase of 46.10%.

Entering 2025, the company’s profitability continues to grow; in the first three quarters, it achieved revenue of 1.608 billion yuan, a slight year-on-year decrease of 5.23%, but the net profit attributable to shareholders still reached 80.5149 million yuan, an increase of 12.94% year-on-year.

Help the major shareholder

“Settle debts”?

The recent sharp rise in ShunNa Co., Ltd.'s stock price has also brought the controlling shareholder’s urgent need to “settle debts” to light.

In April 2016, ShunNa Co., Ltd. announced that its former controlling shareholder, Tibet Huishun Investment Co., Ltd. (hereinafter referred to as “Tibet Huishun”), planned to transfer its 120 million shares of the company, accounting for approximately 17.37% of the total share capital, to Huifu Boyan at a price of 12.92 yuan per share, with a total transaction price of 1.55 billion yuan, which was more than a 30% premium over the closing price before the company’s suspension.

After the completion of this transaction, Huifu Boyan officially became the controlling shareholder of ShunNa Co., Ltd. and began a series of capital operations. In early 2017, ShunNa Co., Ltd. invested 450 million yuan to acquire 60% of the shares of Zhejiang Hansheng Xiechuang Industry Co., Ltd. (hereinafter referred to as “Zhejiang Hansheng”) under the pretext of laying out bulk trade and supply chain finance businesses and promoting the company’s transformation.

After the completion of this acquisition, at the end of 2017, the actual controller of Zhejiang Hansheng, Chen Huan, was parachuted into ShunNa Co., Ltd. to serve as the new chairman of the company.

This series of changes attracted regulatory attention. The Shenzhen Stock Exchange once sent a letter inquiring whether there was a concerted action relationship between Huifu Boyan and Chen Huan. Although both parties clearly denied any related relationship or concerted action arrangements, from publicly available information, both Zhejiang Hansheng and Huifu Boyan had close ties with the then leading P2P platform, Grassroots Investment.

According to a financial magazine report, Zhejiang Hansheng was once a subsidiary of Grassroots Investment, and its actual controller, Chen Huan, and the founder of Grassroots Investment, Jin Zhongkao, were both practicing lawyers at Zhejiang Tuoyuan Law Firm and had a deep connection.

In addition, information disclosed by ShunNa Co., Ltd. shows that the funds for Huifu Boyan’s acquisition of the listed company’s equity all came from the Ping An Huitong Huiyin Aofeng Hui Fu No. 2 Special Asset Management Plan.

This asset management plan was established by Class A and Class B trustees, with the Class A trustee being the Guangzhou branch of SPD Bank, contributing approximately 1 billion yuan, and the Class B trustee being individual Sun Jiancheng, contributing approximately 550 million yuan.

However, how did Sun Jiancheng, who previously had no reputation in the capital market, manage to come up with such a large sum of 550 million yuan? It is understood that Sun Jiancheng previously served as the legal representative and general manager of the financing leasing company under Grassroots Investment, and like Jin Zhongkao and Chen Huan, he also had experience working at Zhejiang Tuoyuan Law Firm.

Therefore, Sun Jiancheng, Jin Zhongkao, and Chen Huan each took separate paths: Jin Zhongkao focused on P2P business, attracting investment funds; Sun Jiancheng was responsible for obtaining control of the listed company, ultimately leading to Chen Huan serving as the chairman of the listed company, completing control over the listed platform.

However, this carefully constructed capital structure quickly collapsed with the implementation of stringent regulations in the online lending industry. In July 2018, Grassroots Investment officially collapsed, and its actual controller, Jin Zhongkao, was sentenced for illegal public deposit absorption and fundraising fraud, involving nearly 10 billion yuan.

In this context, ShunNa Co., Ltd.'s then chairman Chen Huan was immediately arrested, and the 17.37% equity held by Huifu Boyan was also judicially frozen.

At the same time, ShunNa Co., Ltd.'s stock price experienced a sharp decline, with a cumulative drop of up to 76.03% for the entire year of 2018, closing at only 2.53 yuan per share at the end of the year. Based on this calculation, the market value of Huifu Boyan’s shares had dropped to 304 million yuan, a floating loss of 1.246 billion yuan compared to the initial investment of 1.55 billion yuan.

With such a huge floating loss, not only did Class B trustee Sun Jiancheng lose all his investment, but SPD Bank, as Class A trustee, also faced the risk of not being able to recover its 1 billion yuan priority investment in full.

According to the announcement information disclosed at the time, SPD Bank’s priority investment enjoyed a fixed annualized return of 7.3%, and the income from the asset management plan needed to fully repay SPD Bank’s principal and agreed income before any remaining portion could be distributed to Sun Jiancheng; the maximum term for this investment was 10.5 years, and 2026 is the year for the maturity repayment of this fund.

Now, with the strong rise in ShunNa Co., Ltd.'s stock price, the market value of the shares held by Huifu Boyan has risen back to 2 billion yuan based on current stock prices.

Although the overall annualized return of this investment is not particularly outstanding, it is sufficient to cover the principal and interest repayment of the priority funding. Based on the agreed annualized return of 7.3%, the total principal and interest for SPD Bank’s 1 billion yuan investment is approximately 1.73 billion yuan. If estimated at the current market value, SPD Bank can not only recover the full principal but also receive all the interest as agreed.

It is worth noting that Cai Huiyan, the deputy general manager of the asset management department of SPD Bank’s Guangzhou branch, has served as a director of ShunNa Co., Ltd. since 2024.

The real big winner behind the scenes

Zhang Mingyuan

In fact, the original actual controller of ShunNa Co., Ltd., Zhang Mingyuan, is the true big winner in this capital operation.

In 2001, ShunNa Co., Ltd. fell into a reorganization predicament. At that time, Tibet Huishun, controlled by Zhang Mingyuan, obtained 144 million shares of ShunNa Co., Ltd. from Guangdong Xinli Group through judicial determination and judicial auction within a month.

Among them, 108 million shares were acquired at 1 yuan per share, and 35.78 million shares at 1.66 yuan per share, with a total cost of approximately 167 million yuan. Since then, Zhang Mingyuan became the new actual controller of ShunNa Co., Ltd. Subsequently, after a reduction in holdings and the company’s “10-for-2” bonus share plan, his shareholding increased to approximately 172 million shares.

Under Zhang Mingyuan’s control, Tibet Huishun transferred 120 million shares it held at a price of 12.92 yuan per share to Huifu Boyan, cashing out 1.55 billion yuan, far exceeding its original holding cost.

In addition to transferring equity to Huifu Boyan, Tibet Huishun also transferred 52.4721 million shares to Zhang Mingyuan at a price of 8.50 yuan per share. Adding the 2 million shares that Zhang Mingyuan held previously, he personally held a total of 54.4721 million shares of ShunNa Co., Ltd.

Now, with the continuous rise in ShunNa Co., Ltd.'s stock price, the market value of Zhang Mingyuan’s shares has surged to 1.012 billion yuan, with substantial floating profits. In this context, on February 10, ShunNa Co., Ltd. announced that Zhang Mingyuan plans to reduce his shareholding by no more than 6.9082 million shares.

In addition to obtaining considerable investment returns, Zhang Mingyuan also acquired the company’s previously most important asset—Guangdong Wanjiake Gas Appliances Co., Ltd. (hereinafter referred to as “Wanjiake Gas Appliances”).

In 2016, ShunNa Co., Ltd. announced that it would transfer 100% equity of its wholly-owned subsidiary Wanjiake Gas Appliances to Tibet Shunhui and Zhang Yicheng, who hold 40% and 60% of the shares, respectively. Among them, Zhang Yicheng is the son of Zhang Mingyuan, the actual controller of Tibet Shunhui.

This transaction was ultimately priced at 744.98 million yuan. This price is extremely favorable for Zhang Mingyuan and his son. According to the 2015 annual report, Wanjiake Gas Appliances contributed 2.568 billion yuan in revenue to ShunNa Co., Ltd. that year, accounting for 62.16% of the company’s total revenue; its net profit accounted for 82.16% of the company’s total net profit, making it the core source of the company’s profits.

It can be seen that Zhang Mingyuan not only achieved huge investment returns in this capital game but also acquired the main operating assets of the listed company at an extremely low price, making him the biggest winner.