Core Viewpoint - Kanghua Biological is undergoing a change in its actual controller, which may impact its future operations and ownership structure [2] Company Overview - Kanghua Biological, founded in 2004 and listed on the ChiNext board in 2020, specializes in vaccine development, primarily focusing on rabies vaccines and meningococcal polysaccharide vaccines [4] - The company has seen a significant decline in performance, with over 90% of its revenue historically coming from a single product, the freeze-dried rabies vaccine [4][6] Financial Performance - Kanghua Biological's revenue from 2020 to 2023 showed a steady increase, reaching 1.577 billion in 2023, but the net profit has been declining since its peak of 829 million in 2021, dropping to 509 million in 2023 [4][5] - In 2024, the company reported a revenue of 1.432 billion, a year-on-year decline of 9.23%, and a net profit of 399 million, down 21.71% [5] - The core reason for the performance decline is attributed to a drastic drop in the approval quantity of its main product, with a 43.83% decrease in the number of rabies vaccine batches approved [6] Ownership and Control - Wang Zhentao, the actual controller of Kanghua Biological, holds 19.02% of the company's shares and is known for his previous success in the shoe industry [3][4] - The announcement of the control change comes after Wang's significant financial challenges, including high stock pledge rates and investigations by the China Securities Regulatory Commission for fund misappropriation [13][15] Market Context - The shoe industry, particularly for Wang's previous company, Aokang International, has faced declining demand, with production dropping from 4.618 billion pairs in 2016 to 3.524 billion pairs in 2021, and projections indicating further contraction [12] - Aokang International has also reported continuous losses since 2022, further complicating Wang's financial situation [9]