Changling Hydraulic(SH:605389) Chang Jiang Shang Bao·2025-09-09 23:33Core Viewpoint - The transfer of shares by the controlling shareholders of Changling Hydraulic, Xia Jifa and Xia Zemin, is progressing smoothly, with plans to cash out approximately 20.75 billion yuan through a two-step process involving share transfers and a tender offer [1][5]. Share Transfer Details - Xia Jifa and Xia Zemin are transferring a total of 41.99% of their shares in Changling Hydraulic, which includes 24.99% to Wuxi Core Technology and 5% to Chenglian Shuangying [2][3]. - The share transfer involves 36,007,400 shares, with Xia Jifa transferring 26,209,400 shares (18.19% of total shares) and Xia Zemin transferring 9,797,900 shares (6.80% of total shares) [2]. Financial Impact - The total cash out from the share transfers is approximately 20.75 billion yuan, with 14.68 billion yuan from the initial transfers and an additional 6.27 billion yuan expected from the tender offer [3][5]. - After the share transfers, Xia Jifa and Xia Zemin will still control 40.94% of Changling Hydraulic [4]. Company Performance - Changling Hydraulic has faced declining profits since its IPO, with net profits decreasing for four consecutive years from 2021 to 2024 [1][8]. - The company reported revenues of 9.07 billion yuan in 2021, which have fluctuated slightly, but net profits have consistently declined, reaching 0.95 billion yuan in 2024 [8]. - Despite the declining performance, the company plans to distribute over 90% of its profits as dividends in 2024 and the first half of 2025 [1][9]. Business Background - Changling Hydraulic was established in 2006 and went public in 2021, primarily engaged in the research, production, and sales of hydraulic components [7]. - The company has attempted to diversify its operations by planning to acquire a 70% stake in Jiangyin Shangchi Machinery, a company in the photovoltaic industry, but has faced challenges in meeting performance commitments [8][9].