Core Viewpoint - The recent detention of Wu Haifeng, a director of Suzhou Hesheng New Materials Co., Ltd., due to alleged illegal loan issuance has raised concerns, although the company claims it will not affect its operations or control stability [2][3][4]. Company Response - Hesheng New Materials stated that the incident is a personal matter of Wu Haifeng and does not impact the company's operations or governance [3][4]. - The company emphasized that its board of directors remains functional and that there has been no change in control [3][4]. Market Reaction - Following the news of Wu Haifeng's detention, Hesheng New Materials' stock price fell by 8.71% on October 14, closing at 38.14 yuan [2][8]. - Prior to the incident, the stock had seen a notable increase, reaching 41.78 yuan per share on October 13 [8]. Financial Performance - Hesheng New Materials has shown positive financial performance, with a 58.31% year-on-year increase in net profit for the first half of 2025, reaching 97 million yuan [6][7]. - The company's gross profit margin improved to 15.66%, reflecting a 48.69% increase compared to the previous year [6][7]. - However, the company has been facing challenges with cash flow, reporting a 17.06% decline in net cash flow from operating activities in 2024 [7]. Shareholder Actions - Wu Haifeng had previously announced plans to increase his shareholding by 10 to 20 million yuan, but there has been no progress reported on this front [2][4]. - Other shareholders, including the chairman, have reduced their holdings, with a total of approximately 16,730 shares sold, accounting for 0.0675% of the company's total shares [6]. Future Considerations - Experts suggest that Wu Haifeng's detention may hinder his ability to participate in stock transactions, potentially affecting his planned share purchase [5]. - The company is advised to strengthen compliance and internal control mechanisms to mitigate risks associated with high-level executives [5].