EVE Energy unexpectedly redeems 5 billion yuan of convertible bonds early, causing a “double hit to stocks and bonds.”
Ignoring investors’ interests, the prospects for its Hong Kong IPO may be in question or may change.

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Produced by: Sina Finance Listed Company Research Institute

Author: Hao

On March 30, Yew Wei Lithium (rights protection) released an announcement, saying it would redeem the “Yew Wei Convertible Bonds” early. The next day, Yew Wei Lithium’s underlying stock fell by nearly 10%, and the Yew Wei Convertible Bonds even saw a 20% “one-word board” limit-down.

In March 2025, Yew Wei Lithium issued convertible bonds to finance 5 billion yuan, with the interest rate in the first year at only 0.2%. This year, on March 30, right on the day it just met the clause that the closing price for nearly 15 trading days would be no less than 130% of the conversion price, Yew Wei Lithium quickly examined and approved the early redemption proposal.

That is to say, Yew Wei Lithium used 5 billion yuan for one year at almost zero cost, and then, through forced redemption, reclaimed the potential conversion rights held by investors. In fact, the company’s finance expense ratio is only around 1%, similar to peer companies. Yew Wei Lithium’s approach of disregarding the interests of small and medium investors in pursuit of “cheap gains” surprised the market greatly; investors “voted with their feet,” resulting in a “double hit” for both the stock and the bonds.

In 2025, Yew Wei Lithium barely kept net profit year-on-year flat by reducing the R&D expense capitalization rate. While the company’s profitability declined, the cash collection ratio remained at a low level, and operating conditions did not improve.

It is worth noting that the company’s actual controller, however, cashed out nearly 3 billion yuan through equity transfers that year, effectively reducing the earlier private placement they had participated in at a low level. A series of actions gradually eroded market trust, and the ongoing Hong Kong IPO being advanced is undoubtedly also set to suffer negative effects as a result.

Unexpected Early Redemption of Convertible Bonds Using a 0.2% Interest Rate to Occupy 5 Billion for One Year

On the evening of March 30, Yew Wei Lithium issued an announcement stating that it would redeem the “Yew Wei Convertible Bonds” early. The redemption price was 100.034 yuan per bond. The redemption registration date was April 23, 2026, and the redemption date was April 24.

On March 31, Yew Wei Lithium’s underlying stock fell by 9.93%. The convertible bonds even saw a 20% “one-word board” limit-down. The market “voted with its feet,” expressing strong dissatisfaction with Yew Wei Lithium’s move.

On March 24, 2025, the 5 billion yuan Yew Wei Convertible Bonds were officially issued. The originally designed conversion period was from September 29, 2025 to March 24, 2031, lasting 6 years, with annual interest rates of 0.2%, 0.4%, 0.6%, 1.5%, 1.8%, and 2.0%. However, after only one year and 6 days, Yew Wei Lithium was already eager to initiate forced redemption, clearly to avoid paying interest rates that rise year by year. That is to say, Yew Wei Lithium occupied the 5 billion yuan for one year at a cost of only 0.2%.

It should be noted that Yew Wei Lithium’s finance expense ratio has long been around 1%, lower than comparable companies such as Gotion High-Tech and Sunwoda, and only higher than leading company CATL, meaning its interest-bearing cost is not high.

Moreover, from February 25 to March 30, 2026, within 30 consecutive trading days, Yew Wei Lithium’s stock had closing prices on 15 trading days that were no less than 130% of the conversion price of 50.28 yuan per share (i.e., 65.37 yuan), accurately triggering the “conditional redemption clause.” On March 30, the company’s board of directors made a “timed” decision: after the close of the April 23 registration date, any bonds not converted would be forcibly redeemed in full at a price of 100.034 yuan per bond—far below the market price of about 167 yuan at the time—further highlighting the management’s “can’t wait” mindset.

Convertible bonds are usually seen as a financing instrument with “a floor on the downside and no cap on the upside,” but forcing redemption after issuing only one year is rare in the A-share market. Some people in the market said, “The bonds have been listed for about a year; there’s still a long time until maturity. Most investors think the company won’t trigger forced redemption so quickly, but it turned out they were caught off guard.”

Yew Wei Lithium’s approach of pursuing “cheap gains” while disregarding the interests of small and medium investors greatly surprised the market; investors “voted with their feet,” resulting in a “double hit” for both stocks and bonds.

Lowered R&D Expense Capitalization Rate; Net Profit Barely Kept Flat; Actual Controller Cashes Out 3 Billion and Heads to Hong Kong Financing Again

In 2025, Yew Wei Lithium’s power battery shipment volume was 50.15 GWh, up 65.56% year on year. Its shipment volume rose to sixth place in the global power battery rankings. Energy storage battery shipment volume was 71.05 GWh, up 40.84% year on year, ranking among the top two globally.

However, the rise in market share relied entirely on “price wars” driven by internal competition, and it brought the company no improvement to performance or cash flow.

In 2025, Yew Wei Lithium’s revenue was 61.470 billion yuan, up 26.44%. The growth rate was significantly lower than the shipment growth of lithium batteries for power and energy storage. It achieved net profit attributable to the parent company of 4.134 billion yuan, up 1.44%, an increase of only 0.58 billion yuan.

It should be noted that Yew Wei Lithium’s full-year R&D expenditures totaled 3.435 billion yuan. Of this, about 400 million yuan was not included in that year’s R&D expenses, lower than the expense capitalization rate of nearly 100% in the previous years. Relying on accounting methods, it barely managed to keep full-year net profit basically flat.

In fact, compared with comparable companies, Yew Wei Lithium’s net profit growth rate has long been on the low side. This is especially evident since 2024.

In 2025, Yew Wei Lithium’s gross margin was 16.17%, down 1.24 percentage points year on year; its net profit margin was 6.73%, down 1.65 percentage points year on year. While profitability fell, the cash collection ratio also remained at a low level below 80%.

Operating conditions have not improved, but the controlling shareholders are busy with other matters.

In November 2025, Yew Wei Lithium’s actual controller, Liu Jincheng and Luo Jinhong, transferred 40.77 million shares through a pricing-based transfer (inquiry-based transfer). The transfer price was 72.20 yuan per share, and they cashed out 2.944 billion yuan at one time.

In 2022, Yew Wei Lithium raised 9.0 billion yuan at a price of 63.11 yuan per share by issuing shares to the controlling shareholder Yew Wei Holdings and the actual controller Liu Jincheng and Luo Jinhong through a private placement. This equity transfer effectively reduced a portion of the private placement they had participated in earlier at a low level.

In 2019 and 2020, Yew Wei Lithium also conducted two private placements, raising a total of 5 billion yuan from the market. Currently, the company is planning a Hong Kong IPO.

However, a recent series of actions has caused the market to gradually lose trust in the company, and the ongoing Hong Kong IPO financing will undoubtedly also be negatively affected.

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Responsible editor: Company Observation