Hui Cheng Technology(SZ:300779) Xin Lang Zheng Quan·2025-08-07 01:26Core Viewpoint - The article discusses the significant disparity between the stock price and the fundamental performance of Huicheng Environmental Protection, raising concerns about its sustainability and potential classification as a "zombie stock" [3][4][30]. Group 1: Company Financial Performance - Huicheng Environmental Protection's revenue for the first half of 2025 was 564 million yuan, a year-on-year decrease of 5.09%, while net profit dropped by 85.63% to 5.02 million yuan [3][30]. - The company's stock price has increased over 20 times since 2022, reaching 175 yuan per share, despite the declining financial performance [1][3]. - The company has seen a significant increase in accounts receivable, which reached 419 million yuan in the first half of 2025, a 57.11% increase compared to the beginning of the period [33]. Group 2: Business Model and Projects - Huicheng Environmental Protection focuses on solid waste treatment, particularly in the recycling and processing of waste catalysts for refining enterprises [5][10]. - The company has launched several key projects, including a 20,000-ton/year mixed waste plastic resource utilization project, which is expected to generate significant revenue [11][12]. - The company’s innovative "one-step" process for waste plastic treatment has been highlighted as a global first, with a projected annual output value of 1.243 billion yuan for the first phase [12][14]. Group 3: Investment and Expansion Plans - The company plans to raise 850 million yuan through a private placement, with 600 million yuan allocated for the Dannan Sea Petrochemical Industrial Zone project and 250 million yuan for liquidity support [1][3]. - Future expansion plans include a 300,000-ton/year project with an estimated total investment of 20 billion yuan, indicating aggressive growth strategies despite current financial pressures [20][30]. - The company’s total investment in major projects is reported to be 3.146 billion yuan, with a remaining funding requirement of 1.666 billion yuan [20][21]. Group 4: Concerns and Comparisons - The company has drawn comparisons to Zuojiang Technology, which faced severe issues leading to its delisting due to financial fraud, raising questions about Huicheng's sustainability [4][30]. - The low proportion of institutional investors and high personal shareholder ownership (nearly 80%) has led to skepticism regarding the stock's valuation and potential manipulation [3][4]. - The company’s research and development spending has been criticized for being disproportionately low compared to its ambitious technological claims, with total R&D expenditure from 2016 to 2024 amounting to only 153 million yuan [14][17].