Core Viewpoint - The report by Zhiyan Consulting highlights the market trends and price fluctuations of corrugated cardboard in China from 2026 to 2032, indicating a decline in prices as of January 2026 compared to previous years [1] Price Trends - As of mid-January 2026, the market price for corrugated paper (AA grade, 120g) is 2723.8 yuan per ton, reflecting a year-on-year decrease of 6.66% and a month-on-month decrease of 4.81% [1] - The highest recorded price in the past five years was in mid-January 2022, reaching 3900 yuan per ton [1]

Core Viewpoint - The announcement by Dongfang Precision Engineering to sell its European core assets for €774 million (approximately ¥6.34 billion) has raised eyebrows in the capital market, suggesting a strategic move rather than a mere loss-cutting measure [1][3]. Group 1: Transaction Details - The timing of the transaction is notable, occurring amidst the backdrop of geopolitical tensions affecting foreign investments in Europe, particularly following the asset freeze of Anshi Semiconductor by the Dutch government [3][13]. - The three companies being sold, including Fosber Group, are not loss-making but are significant revenue generators, expected to contribute ¥3.211 billion in revenue in 2024, accounting for 67.2% of Dongfang's total revenue [5][9]. - The asset's value has increased dramatically, from an initial investment of approximately €740 million to a sale price of €774 million, representing a more than tenfold increase in value over ten years [7]. Group 2: Strategic Implications - The decision to sell is seen as a proactive risk management strategy in light of increasing scrutiny and regulatory challenges for foreign investments in Europe, with 81% of Chinese companies in Europe reporting heightened uncertainty in the business environment [17][19]. - The choice of buyer, Brookfield Asset Management, a Canadian firm managing over $1 trillion in assets, is viewed positively as it is less likely to disrupt existing operations, focusing instead on stable returns [21]. - The cash from the sale will be redirected towards domestic ventures in new production sectors, specifically in marine power equipment and humanoid robotics, which align with current policy trends [23][25]. Group 3: Market Reaction and Future Outlook - The market has responded favorably, with Dongfang's stock price increasing by 90.71% year-to-date, reflecting investor confidence in the company's strategic pivot towards domestic opportunities [40]. - The company's net profit rose by 54.64% in the first three quarters, indicating that investors are optimistic about the potential of the new business directions despite the short-term revenue decline from selling its core assets [40][42]. - The overall strategy highlights the importance of adaptability in a changing global landscape, suggesting that proactive transformation may become a common approach among Chinese enterprises facing uncertainty [42][44].