Core Viewpoint - Shanghai Xiba's stock price surged after entering the solid-state battery business in 2022, but the actual impact on revenue remains minimal despite the hype surrounding the solid-state concept [1] Group 1: Company Overview - Shanghai Xiba, established in 1994, specializes in water treatment specialty chemicals, process chemicals, and advanced materials in the new energy sector [1] - The company has experienced declining revenue in recent years, with a decrease of 10.5%, 5.8%, and 5.52% in revenue growth for the first three quarters of 2023 compared to previous years [1] Group 2: Stock Performance - The company's stock price increased over fourfold since June 2022, with a more than 200% rise in 2023 alone, but has recently seen a decline of nearly 30% from its peak [1][4] - The stock price rose from a low of 16 CNY/share to a peak of 110 CNY/share, reflecting significant volatility [3][4] Group 3: Solid-State Battery Business - Shanghai Xiba entered the solid-state battery field through a collaboration with the Shanghai Institute of Ceramics, Chinese Academy of Sciences, establishing a joint innovation laboratory [2] - The company has announced plans for the production of various solid-state battery materials, including 200 tons/year of solid-state lithium-ion battery powder and 500 tons/year of silicon-carbon anode materials [2] - The solid-state battery business has multiple technology routes, including sulfide, oxide, and halide [5] Group 4: Management and Governance Issues - The company is under investigation for short-term trading violations by executives, raising concerns about governance [5][6] - The actual controller of the company initiated a share reduction plan in June 2023, although the plan has not been executed yet [6]

Core Viewpoint - Shanghai Xiba plans to acquire patents and establish two holding subsidiaries to promote the industrialization of high-energy hydrogen-electric hybrid power systems and special solid-state lithium-ion battery technologies, enhancing its position in the new energy sector [1][2]. Summary by Sections Patent Acquisition - Shanghai Xiba will purchase four invention patents and one utility model patent from the Dalian Institute of Chemical Physics, Chinese Academy of Sciences, for a total of 25 million yuan (approximately 3.5 million USD) [1]. Subsidiary Establishment - The company intends to set up two holding subsidiaries with a registered capital of 10 million yuan (approximately 1.4 million USD) each, in collaboration with its core technology and management teams [1][2]. Business Strategy - The establishment of these subsidiaries aligns with the company's business and strategic planning, aiming to integrate technical advantages and resources from partners to enhance its capabilities and competitiveness in the new energy sector [2]. Current Business Context - Shanghai Xiba's main business involves customized water treatment chemicals and equipment, with a recent focus on advanced materials for solid-state batteries [3]. The company has completed the design of high-energy soft-pack lithium-ion solid-state batteries, which are now in small-scale production [3]. Financial Performance - In Q1 2025, the company reported a significant decline in net profit by 51% year-on-year to 9.83 million yuan (approximately 1.4 million USD), with a 17% drop in revenue, primarily due to the lack of high-margin projects compared to the previous year [4]. Future Outlook - Despite substantial investments in advanced materials, the business has not yet generated stable, large-scale revenue [5]. The company plans to focus on its core water treatment services while gradually reducing its involvement in engineering construction, aiming to develop a second growth curve in the new energy advanced materials sector [4].