Core Viewpoint - The company, Yiwu Huading Nylon Co., Ltd., is responding to inquiries regarding its stock issuance plan, detailing the funding sources and project feasibility, with a significant increase in control rights for its major shareholder, True Love Group [1][2]. Group 1: Shareholder Subscription Plan - True Love Group plans to subscribe to the new shares using a combination of 40% self-owned funds and 60% bank pledge financing, with a total expected investment of 708 million yuan [2]. - The total amount to be raised from the issuance is capped at 707.5 million yuan, with a maximum of 250 million shares to be issued [2]. - True Love Group's self-owned funds are approximately 283 million yuan, sourced from cash, financial assets, and share pledges, while the pledged financing is about 424.5 million yuan, with loan commitments from five state-owned banks [2]. Group 2: Control Rights and Stability - Following the issuance, True Love Group's voting rights will increase from 15.81% to 31.36%, with a lock-up period of 36 months for the newly acquired shares [3]. - The actual controller of True Love Group has committed to avoiding share disposals in case of pledge risks, ensuring control stability [3]. - The banks involved have confirmed that there will be no pledge liquidation clauses, further reducing the risk of control changes [3]. Group 3: Fundraising Project Focus - The raised funds will be directed towards a project to produce 65,000 tons of high-quality differentiated nylon PA6, with a total investment of 950 million yuan and an expected internal rate of return (IRR) of 14.72% [4]. - The project aims to expand existing nylon filament capacity, increasing annual production capacity to approximately 320,000 tons, reinforcing the company's position as the third-largest in the industry [4]. - The company anticipates strong demand for its products, with utilization rates projected to rise significantly from 67.43% in 2022 to 92.39% in 2024 [4]. Group 4: Financial Data and Funding Gap - The company reported a 45.76% decline in revenue for the first half of 2025, totaling approximately 241 million yuan, primarily due to the sale of its cross-border e-commerce business and cyclical fluctuations in the nylon industry [5]. - The net profit for the same period was approximately 15.28 million yuan, down 6.14% year-on-year, attributed to a 19.47% decrease in raw material prices [5]. - The total funding requirement for operations and projects from 2025 to 2026 is estimated at 2.647 billion yuan, with a funding gap of approximately 1.462 billion yuan, which the new issuance will help alleviate [6].