Core Viewpoint - The company Jin Yi Culture (002721.SZ) has experienced significant stock price increases due to its association with the "stablecoin" concept, but its core jewelry business has been declining, raising concerns about the sustainability of its recent performance and the reliability of its acquisitions [1][2][5]. Group 1: Stock Performance and Market Reaction - Jin Yi Culture's stock surged by 46.8% in July, with a doubling in price over the past two months, driven by the "stablecoin" narrative and speculative trading [1][2]. - On July 8, the stock reached a high of 4.86 CNY per share before closing at 4.75 CNY, marking a 7.47% increase for the day [2]. - Despite the stock's rise, there are signs of major investors withdrawing, with a net outflow of 767 million CNY, accounting for nearly 21% of total trading volume [3]. Group 2: Business Transformation and Challenges - Jin Yi Culture's original business focused on jewelry design and sales, with peak revenues exceeding 10 billion CNY and over 1,000 stores nationwide [4]. - The company faced severe financial difficulties due to aggressive acquisitions, leading to a cumulative loss of 7.813 billion CNY from 2020 to 2022, and it was placed under delisting risk by the Shenzhen Stock Exchange [5][6]. - In 2023, the company began restructuring efforts, including asset divestiture and debt restructuring, significantly reducing its debt ratio from 171.83% to 4.83% by the end of 2024 [5]. Group 3: Acquisition and Future Prospects - The acquisition of Beijing Kaike Weishi Technology Co., Ltd. for 412 million CNY at a 103% premium is seen as a potential growth driver, with performance guarantees for 2025-2027 [7][8]. - However, the acquired company reported a sudden loss of 728,570 CNY in the first nine months of 2024, raising doubts about its future profitability [8]. - The company's plans to expand into stablecoin services have not yet materialized, and the overall market conditions and regulatory environment may hinder its ability to improve financial performance [8].