Sanfang Lane: Rapid increases in product prices have led to a decline in the purchasing willingness of downstream customers.

On March 17, SanFang Alley (600370.SH) issued an announcement regarding abnormal stock trading fluctuations. The company’s stock price closed with a cumulative deviation of over 20% in the past two trading days, which, according to the relevant provisions of the Shanghai Stock Exchange Trading Rules, constitutes an abnormal stock trading fluctuation.

In response to the abnormal trading fluctuations, the company conducted an investigation into the relevant matters and inquired with the controlling shareholder and the actual controller. After verification, the company disclosed its 2025 annual performance forecast on January 20, 2026, estimating a net profit attributable to the parent company of between -760 million and -840 million yuan, representing an increase in loss of 55.91% to 72.32% compared to the same period last year. Currently, there have been no significant changes in the company’s production, operations, or industry policies. Additionally, as of the date of this announcement, aside from the disclosed matters, the company, controlling shareholder, and actual controller do not have any major undisclosed matters that should be disclosed. Furthermore, the company has not found any media reports or market rumors that could significantly impact the stock trading price, nor has it identified any hot concept topics involved.

The company specifically reminds investors to pay attention to related risks: First, market trading risk. The company’s stock has recently experienced multiple abnormal trading fluctuations, with turnover rates of 4.29% and 6.52% over two consecutive trading days. Second, main product price risk. Due to geopolitical tensions and international energy prices, the prices of major chemical products have fluctuated significantly recently. The company’s order backlog has increased costs due to rising raw material prices, and the rapid increase in product prices has weakened downstream customer purchasing willingness. Third, operational performance risk. The company expects to incur significant losses in 2025. Lastly, the risk of shares held by the company’s controlling shareholder being frozen. The controlling shareholder and its concerted actors have pledged all their shares and those are under judicial freeze.