Yashi Chuangneng: The 12.5 million shares held by the controlling shareholder will be auctioned by the judiciary, accounting for 2.92% of the company's total share capital.

On February 23, Yashi Chuangneng Technology (Shanghai) Co., Ltd. (Yashi Chuangneng, 603378.SH) issued a tentative announcement that some shares held by the company’s controlling shareholder will be subject to judicial auction. The company’s controlling shareholder, Shanghai Chuangneng Ming Investment Co., Ltd. (hereinafter referred to as “Chuangneng Ming”), will have 12.5 million unrestricted circulating shares auctioned by judicial authorities, accounting for 2.92% of the company’s total share capital.

The announcement states that the People’s Court of Shangcheng District, Hangzhou City, will conduct a public auction of the aforementioned shares on the Taobao Judicial Auction Platform from 10:00 AM on March 16, 2026, to 10:00 AM on March 17, 2026 (excluding delays). The auction will be divided into three lots: two lots of 4 million shares each and one lot of 4.5 million shares. The starting prices for the three lots are 19.236 million yuan, 19.236 million yuan, and 21.6405 million yuan, respectively. The deposits are 3.8472 million yuan, 3.8472 million yuan, and 4.3281 million yuan, with an increment of 50,000 yuan for each bid. As of the date of the announcement, the shares proposed for judicial auction are all under judicial freeze.

As of the disclosure date of this announcement, Chuangneng Ming holds a total of 78.6555 million shares of Yashi Chuangneng, accounting for 18.35% of the company’s total share capital. Yashi Chuangneng stated in the announcement that this auction will not affect the company’s production and operation nor will it cause the company’s shareholding structure to lose its listing conditions.

The announcement indicates that the judicial auction process is currently in the public notice stage. Subsequent steps will include bidding, payment, and transfer of shares, and the auction outcome remains uncertain. The specific details, procedures, and requirements of this auction are subject to the final court announcement. If the auction is successful and the subsequent share transfer procedures are completed, the total shares held by controlling shareholder Chuangneng Ming will change to 66.1555 million shares, estimated to represent 15.44% of the company’s total share capital.

According to the official website, Yashi Chuangneng originated in 1998 and is a high-tech enterprise integrating the research, development, manufacturing, and service of coatings, finished boards, insulation, waterproofing, mortar, and new home materials.

Previously, Yashi Chuangneng disclosed a performance forecast indicating that the company expects a net loss attributable to the parent company of approximately 830 million to 1.25 billion yuan for 2025; it also expects a net loss attributable to the parent after deducting non-recurring gains and losses of about 860 million to 1.29 billion yuan for the same period.

Regarding the main reasons for the expected loss, Yashi Chuangneng stated in the announcement that during the reporting period, due to the ongoing weakness in the real estate and construction industries and a significant decline in orders, the company’s operating income decreased, and gross profit margin declined. Additionally, in accordance with the “Enterprise Accounting Standards” and based on the principle of prudence, the company made impairment provisions for assets such as fixed assets, construction in progress, and accounts receivable that showed signs of impairment, and reversed previously recognized deferred tax assets.