Yuguang Gold & Lead Plans to Raise Up to 1.84B Yuan through Private Placement to Explore New Development Paths

(Source: Value Energy Editorial Department)

On the evening of April 3, Yuguang Jinqi issued an announcement, officially disclosing its latest round of non-public share issuance (private placement) plan. After review and approval by the board of directors, the company plans to raise total funding of no more than RMB 1.84B through a non-public issuance of shares. All proceeds will be used for advanced precious and rare metals materials intelligent manufacturing, smart digital upgrades, wastewater resource utilization, and replenishment of working capital.

According to the announcement, the issuance targets for this private placement include no more than 35 qualified specific investors, including the company’s controlling shareholder, Henan Yuguang Group Co., Ltd. (hereinafter referred to as “Yuguang Group”). In terms of issuance size, the company plans to issue no more than 363 million shares, which does not exceed 30% of the company’s total share capital before the issuance. The specific number of shares to be issued will be determined based on the final issuance price. Regarding the pricing mechanism, the pricing benchmark date for this issuance will be the first day of the issuance period. The issuance price will not be lower than 80% of the company’s stock trading average price over the 20 trading days prior to the pricing benchmark date. The final issuance price will be determined by the board of directors in consultation with the lead underwriter, based on subscription bid prices, in accordance with the authorization from the shareholders’ meeting.

As the company’s controlling shareholder, Yuguang Group has made a clear subscription commitment for this private placement: it will not participate in the market price-bidding process for the issuance pricing, but will subscribe at the same price as other investors based on the final price-bidding results. If this issuance cannot generate the issuance price through the bidding process, then it will subscribe at the issuance floor price. In addition, Yuguang Group commits to a subscription amount of no less than RMB 200 million, and the total number of subscribed shares will not exceed 30% of the total shares of this issuance. Further, the shares subscribed by Yuguang Group may not be transferred within 18 months from the end date of the issuance, while the lock-up period for shares subscribed by other investors will be 6 months.

The announcement shows that after deducting issuance expenses, the funds raised in this private placement will be allocated entirely to four major areas, as follows:

First, the advanced precious and rare metals materials intelligent manufacturing project, with planned investment of RMB 1.16B, accounting for 63.08% of the total funds raised in this offering. The project has a total investment of RMB 2.41B. This project will use the “Next-Generation Green and Efficient Refining Technology for Precious and Rare Metals,” which won the “Second Prize for National Science and Technology Progress,” to replace traditional precious and rare metals smelting and recovery processes. It will recover precious and rare metals including gold, silver, tellurium, palladium, and tin, while also developing and manufacturing precious metals catalysts and compounds.

Second, the smart digital upgrade and transformation project, with planned investment of RMB 50 million, mainly for the construction of industrial internet, smart factories, and digital office systems, to improve the level of production intelligence and operational efficiency. The project’s total investment is RMB 54.51 million.

Third, the wastewater resource utilization project, with planned investment of RMB 79 million, focusing on deep treatment of smelting wastewater, reuse, and zero-discharge upgrade. This aligns with the national policy direction for environmental upgrades in the manufacturing sector. The project’s total investment is RMB 89.36 million.

Fourth, replenishment of working capital, with planned investment of RMB 550 million, accounting for 29.90%. As of September 30, 2025, the company’s consolidated statements asset-liability ratio is 73.83%. After this private placement fund-raising, the company can further lower its asset-liability ratio and effectively ease repayment risk.

The company states that before the funds from this fund-raising are in place, it will, based on the actual progress of each project, use self-raised funds to proceed with investments in advance. After the funds are received, the company will replace such investments in accordance with the required procedures. If the actual net amount of funds raised is less than the proposed investment amount, the company will adjust its investment arrangements based on the relative importance of the projects. Any shortfall will be addressed through the company’s self-raised funds.

Public information shows that Yuguang Jinqi was established in January 2000. It was listed on the Shanghai Stock Exchange in July 2002, and is one of the earlier publicly listed non-ferrous metal smelting enterprises in China. Its actual controller is the State-owned Assets Supervision and Administration Commission of the Jiyuan Industrial City Integration Demonstration Zone.

Yuguang Jinqi is mainly engaged in the smelting of lead, zinc, copper, and precious metals. As a core enterprise in China’s non-ferrous metal smelting industry, the company holds an important position in the industry. It is the world’s largest lead smelting enterprise and the largest silver production enterprise in China. For multiple consecutive years, it has ranked among China’s Top 500 Companies. In 2025, it ranked 283rd, securing the No. 7 spot among Henan’s Top 100 Enterprises and No. 3 among Henan’s Top 100 Manufacturing Enterprises. The company’s core product production capacity ranks among the top in the industry: lead annual production capacity of 0.9 million tons, zinc 0.5 million tons, copper 0.25 million tons; gold annual production capacity of 20,000 kg and silver 3,000 tons; and sulfuric acid annual production capacity of 0.8 million tons. The company’s leading products, “Yuguang” brand lead ingots and silver ingots, have been registered with the London Metal Exchange (LME) and the London Bullion Market Association (LBMA), receiving recognition from the global market. In terms of operations, the company’s performance has remained steady. In 2024, it achieved total operating revenue of RMB 39.35B and net profit of RMB 807 million. In the first three quarters of 2025, total operating revenue reached RMB 34.85B and net profit was RMB 620 million. Overall operations have been orderly, and the company has strong industry competitiveness.

In today’s announcement, Yuguang Jinqi stated that after the completion of this private placement, it can effectively relieve the company’s pressure arising from capital needs due to the rapid development of its business, providing funding support for the company’s business development and strategic layout. In addition, after the completion of the private placement, the company’s asset-liability ratio will correspondingly decline, its asset structure will be optimized, which will be conducive to strengthening the company’s ability to repay and reducing its financial risks. With the successful implementation of the projects funded by the raised proceeds and the effective use of the funds, the gradual release of project benefits will enhance the company’s operating scale and economic benefits, thereby bringing better investment returns to the company and its shareholders and promoting the company’s healthy development.

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