Core Viewpoint - The Beijing Stock Exchange has issued the first round of inquiry regarding the IPO of Yongda Co., highlighting concerns over the company's declining net profit despite revenue growth and the stability of its control rights [1][5]. Financial Performance - Yongda Co. operates in various sectors including basic chemicals, coal chemicals, refining, petrochemicals, photovoltaics, and pharmaceuticals, focusing on the development, design, manufacturing, and sales of pressure vessels [2]. - From 2022 to 2024, Yongda Co. reported revenues of 696 million yuan, 712 million yuan, and 819 million yuan, with net profits of 112 million yuan, 131 million yuan, and 107 million yuan respectively. The net profit for 2023 and 2024 showed year-on-year changes of 16.28% and -18.35% [2][4]. - The decline in net profit for 2024 is attributed to a cautious provision for bad debts and impairment losses totaling 33.04 million yuan related to a specific customer, which is considered an incidental matter. Excluding this impact, net profit is expected to grow by 3.14% year-on-year [4]. Control Rights and Shareholding Structure - The actual controllers of Yongda Co. are Li Changzhe, Gu Xiuhong, and Li Jin, who collectively hold 86.56% of the shares. Li Changzhe holds 61.62%, Li Jin 7.74%, and Gu Xiuhong 17.20% [6]. - Li Jin and Gu Xiuhong are married, while Li Jin and Li Changzhe are father and son. In 2016, Li Jin transferred 71% of his shares to Li Changzhe without compensation [6]. - The inquiry from the exchange focuses on the stability of control rights, requiring clarification on the share transfer agreement, management participation, and potential disputes related to the shareholding structure [7]. Fundraising and Future Plans - Yongda Co. plans to raise approximately 608 million yuan, which will be allocated to the construction of a heavy chemical equipment production base and to supplement working capital [7].

Core Viewpoint - Jiangsu Yongda Chemical Machinery Co., Ltd. (Yongda Shares) has submitted an IPO application to raise 608 million yuan, but faces scrutiny over its financial practices and related party transactions [1][2]. Financial Performance - Yongda Shares reported revenues of 696 million yuan in 2022, projected to increase to 819 million yuan by 2024, while its net profit attributable to shareholders (excluding non-recurring gains and losses) showed a compound annual growth rate of -2.13% from 2022 to 2024, with a year-on-year decline of 16.75% in 2024 [2][3]. Related Party Transactions - Concerns have been raised regarding Yongda Shares' historical related party transactions, particularly with Zhangjiagang Yongda Petrochemical Equipment Co., Ltd. (Yongda Petrochemical), which is controlled by the same actual controller, Li Jin. Yongda Petrochemical has acted as a middleman for nearly a decade despite lacking production capabilities [2][3][4]. Ownership Structure - The actual controllers of Yongda Shares, Li Changzhe, Gu Xiuhong, and Li Jin, collectively hold 86.56% of the shares. Li Jin holds 7.74%, while Li Changzhe holds 61.62% and Gu Xiuhong holds 17.20% [2][3]. Share Transfer Controversy - In 2016, Li Jin transferred 71% of his shares to his father, Li Changzhe, raising questions about potential proxy holding and the rationale behind this transfer, given Li Changzhe's limited experience in managing a chemical machinery company [3][4][5]. Dividend Distribution - From 2021 to 2024, Yongda Shares distributed a total of 203 million yuan in dividends, which is four times the amount intended for fundraising. The dividends raised concerns about a potential "clearance-style dividend" situation, as the cash dividends nearly equaled the net profits during the reporting period [7][8].