Hotgen(SH:688068) Chang Jiang Shang Bao·2025-06-30 00:22Core Viewpoint - After a significant increase in stock price, major shareholders of Hotgen Biotech (688068.SH) plan to reduce their holdings to cash out [2][11]. Shareholder Reduction Plans - Shareholder Zhou Xin intends to reduce his holdings by no more than 1.94% of the company's total shares, equating to 180,000 shares, within three months [3][4]. - Zhou Xin currently holds 7.34% of Hotgen Biotech's shares, amounting to 680,660 shares [4]. - If the maximum reduction is executed at the closing price of 137.30 CNY per share on June 25, Zhou Xin could cash out approximately 247 million CNY [5][6]. Historical Context of Shareholder Reductions - Zhou Xin's planned reduction follows a similar pattern observed in 2021, where he and other shareholders executed high-level cash-outs after stock price surges [8][12]. - In 2021, Zhou Xin reduced his holdings from 10.35% to 8.48%, cashing out approximately 102 million CNY at prices ranging from 36.89 to 199.5 CNY per share [10]. Recent Performance and Financials - Hotgen Biotech's stock price has surged approximately fivefold from 23.08 CNY per share on September 23, 2024, to 137.30 CNY per share on June 25, 2024 [7]. - The company has experienced significant financial distress, reporting a loss of 191 million CNY in 2024 and a further loss of 24 million CNY in the first quarter of the same year [17][18]. - Revenue has declined sharply from 35.57 billion CNY in 2022 to 5.11 billion CNY in 2024, marking a decrease of 84.78% year-on-year [17]. Business Operations and Market Position - Hotgen Biotech specializes in in vitro diagnostics (IVD) and has seen fluctuating performance due to the COVID-19 pandemic, with revenues peaking at 5.14 billion CNY in 2020 [15][16]. - The company has been involved in the development of various COVID-19 testing products, which initially drove significant revenue growth [15]. - However, as the pandemic subsided, the company's revenue and net profit have sharply declined, leading to concerns about its future profitability [17][18]. Research and Development Trends - The company's R&D investment has been decreasing, with expenditures dropping from 191 million CNY in 2022 to 113 million CNY in 2024 [18]. - Despite the decline in financial performance, the company has invested in several innovative pharmaceutical companies, although these ventures have yet to yield profits [18].