Core Viewpoint - The company announced the removal of independent director Jing Naiquan due to loss of independence and failure to fulfill duties, which has led to ongoing internal disputes within the company [1][4]. Group 1: Reasons for Removal - The removal was primarily due to Jing Naiquan's perceived bias in a salary dispute involving director Bao Jia, which was seen as contrary to the interests of the company and minority shareholders [5][7]. - Jing Naiquan suggested continuing to pay Bao Jia a salary despite her not being present at work in 2025, which conflicted with the company's established compensation policies [7][8]. - The company accused Jing Naiquan of acting as a representative for specific shareholder interests rather than maintaining his role as an independent overseer [7][8]. Group 2: Internal Disputes - The company disclosed a lengthy announcement detailing the disputes, indicating a significant internal conflict, with both sides presenting extensive arguments [4][9]. - Bao Jia and Jing Naiquan opposed the removal, with Bao Jia claiming it was retaliation for Jing Naiquan's independent stance [9][10]. - Jing Naiquan described the reasons for his removal as absurd and a challenge to the independence of the independent director system [10][11]. Group 3: Company Background - Reliable Co., Ltd. was established in 2001 and went public on the Shenzhen Stock Exchange in June 2021, focusing on the design, development, production, and sales of disposable hygiene products [15]. - The company has a market capitalization of 3.613 billion yuan as of February 24, with a stock price of 13.29 yuan per share [16].

Core Viewpoint - The internal conflict at Reliable Co., Ltd. has escalated, leading to the dismissal of independent director Jing Naiquan by the board of directors, which has raised significant concerns regarding corporate governance and the independence of board members [2][5]. Group 1: Dismissal of Independent Director - Reliable Co., Ltd. announced the removal of independent director Jing Naiquan due to a loss of independence and failure to fulfill his duties, which the company claims undermined the interests of minority shareholders [2][5]. - The board's decision to dismiss Jing will be presented for shareholder approval, indicating a formal process following the internal conflict [2]. - Jing Naiquan's removal has sparked a heated debate, with over 10,000 words exchanged between the opposing parties, highlighting the ongoing internal strife within the company [5]. Group 2: Reasons for Dismissal - The primary contention revolves around the salary of director Bao Jia, who received a pre-tax salary of 2.43 million CNY for 2024, despite not providing actual labor or services to the company [5]. - Jing Naiquan allegedly made inappropriate comments during discussions about Bao Jia's salary and threatened the company and other board members, which led to the conclusion that he had lost his independence [5][6]. - The company accused Jing of failing to review meeting materials as required, leaving meetings without permission, and refusing to sign meeting records, which violated the diligence expected of an independent director [5][6]. Group 3: Jing Naiquan's Response - Jing Naiquan has publicly stated that the reasons for his dismissal are absurd and illegal, asserting that his actions were in line with the interests of the company and minority shareholders [7]. - He claims that he has consistently voted based on the legality and compliance of matters presented to the board, indicating a commitment to corporate governance [7]. - Jing also mentioned that he provided written solutions after leaving the salary meeting and criticized the company for not responding to his suggestions [7]. Group 4: Ongoing Internal Conflict - Director Bao Jia has expressed strong opposition to Jing Naiquan's dismissal, framing it as retaliation from the controlling shareholder, Jin Liwei, for Jing's principled stance [8]. - Bao Jia, who has a significant shareholding of over 29% in the company, has a history of voting against several company proposals, indicating a pattern of dissent within the board [8][9]. - The company, founded in 2001 and listed on the ChiNext board in 2021, specializes in the design, research, production, and sales of disposable hygiene products, which include baby care and adult incontinence products [9][10].

Group 1 - The stock price of Reliable Co. is reported at 15.09 yuan as of August 27, 2025, down 4.79% from the previous trading day [1] - The company opened at 15.61 yuan, reached a high of 15.70 yuan, and a low of 15.08 yuan, with a trading volume of 137,100 lots and a transaction value of 211 million yuan [1] - Reliable Co. specializes in adult incontinence products, baby care products, and pet hygiene products, owning brands such as Reliable and Absorbent Treasure [1] Group 2 - The company has faced internal disputes within its board of directors, attracting market attention [1] - On August 25, the company disclosed its semi-annual report and board resolution announcement, with three proposals opposed by director Bao Jia, who is also the ex-wife of the actual controller and the second-largest shareholder [1] - Bao Jia has publicly criticized the investment decisions and management capabilities of chairman Jin Liwei, as well as the professional competence of the newly appointed secretary Wang Xiangting [1] Group 3 - The company received a warning letter from the Zhejiang Securities Regulatory Bureau on August 26 due to violations in the disclosure of related party transactions [1] - As of August 27, the net outflow of main funds from Reliable Co. was 17.85 million yuan, with a cumulative net outflow of 58.56 million yuan over the past five days [1]

Report Summary 1. Reported Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - The adult incontinence products industry in China is at the end of the introduction period and the beginning of the explosion period, with a penetration rate of about 8%-10%, and there is still significant room for growth compared to international markets [19]. - The long - term care insurance (both TOG and TOC) is expected to promote the industry. The TOG part may lead to a penetration rate of up to 50% within 10 years, and the TOC part shows an increasing demand for brand - building [20][22]. - Reliable Co., Ltd. has made strategic adjustments in product and channel planning, aiming to become the absolute number one in the Chinese adult incontinence field [22]. - The price of adult incontinence products in China is in a state of chaos, and the price is expected to increase with the advancement of long - term care insurance and strengthened market supervision [23][24]. - The industry concentration is increasing, and domestic brands like Reliable have the potential to replicate the success of overseas leading brands [25]. - Although the company's business has been under short - term pressure, it has optimized profitability through cost reduction and efficiency improvement, and is expected to achieve significant growth in the next 3 years [26]. 3. Summary by Questions Question 1: Growth level and industry ceiling of the adult incontinence products industry - The industry in China is at the end of the introduction period and the beginning of the explosion period, with a penetration rate of 8% - 10%, while in Europe, America, and Japan, the penetration rates are 60% and 80% respectively [19]. - The potential of the medium - and mild - incontinence population has not been fully explored [19]. Question 2: The promoting effect of long - term care insurance on the industry - TOG: Referring to Japan's experience, China's long - term care insurance is expected to lead to a penetration rate of up to 50% within 10 years after national promotion [20]. - TOC: The current buyers are mainly relatives of the elderly, with a high proportion of online channels. There is an increasing demand for brand - building and user - service enhancement [22]. Question 3: Product and channel planning in the next three years - Channels: Shifted from dealer - and store - based sales to TOB business, entered hospitals and elderly care institutions, and established a user - operation department for online business [22]. - Brands: Launched the Anhu shi brand targeting cost - effective consumers, and strengthened the positions of Reliable and Xishoubao [22]. - TOG business: Seize government procurement opportunities including long - term care insurance [22]. - Supply chain: Invested in companies like Guangxi Hanggang three years ago to form a closed - loop supply chain [22]. Question 4: Price level and price - increasing potential - The price band in China is chaotic, including high - end, mid - high - end, mid - low - end, and ultra - low - end products. About 210 million pieces of sub - standard products were exposed in 315 this year, accounting for nearly 30% of the market [23]. - In Japan, there are only high - end and mid - high - end products. The price in China is expected to increase with the advancement of long - term care insurance and strengthened market supervision [24]. Question 5: Current competitive landscape and brand concentration - In Europe, America, and Japan, the market share of the first - ranked brand exceeds 50%. Reliable is the leading domestic brand and plans to expand overseas [25]. - The industry concentration is increasing, and domestic brands have the potential to follow the path of overseas leading brands [25]. Question 6: Company's profitability and future growth points - The company's business has been under short - term pressure due to factors such as a decrease in the elderly population and birth rate [26]. - Profitability has been optimized through cost reduction and efficiency improvement, and the optimization of the mother - and - baby segment [26]. - The company is expected to achieve significant growth in the next 3 years with the implementation of long - term care insurance policies, enhanced brand recognition, and overseas expansion [26].