The behind-the-scenes of Zhuhai Guanyu’s 3.3 billion yuan private placement: Previously, a total of 5.3 billion yuan raised; convertible bond prices face the risk of being further lowered.

Recently, Zhuhai Guanyu, a listed company on the STAR Market, announced a 3.3 billion yuan private placement plan, aiming to expand into steel shell lithium batteries for smartphones and wearable devices.

Looking at Zhuhai Guanyu’s financing history, the intensity of capital operations is noteworthy.

In October 2021, the company listed on the STAR Market, raising 2.247 billion yuan; just a year later, in November 2022, the company issued convertible bonds, raising 3.089 billion yuan; in March 2026, it announced another 3.3 billion yuan private placement plan, intended for smart phone and wearable steel shell lithium battery projects, and to add 700 million yuan in working capital.

In the two years before going public, the company conducted two large-scale financings, with total funds raised exceeding 5.3 billion yuan. This does not include leverage through bank loans and other debt financing methods.

In response to questions about “frequent financing,” the company explained that it is seizing the historic opportunity in “AI terminals and steel shell batteries.”

However, the other side of this opportunity is risk. Rapid expansion based on a single customer and a single technical route could face significant impairment risks if downstream demand falls short of expectations or if technology iterates again, leaving large amounts of specialized equipment at risk of write-downs.

About two and a half months before the disclosure of this private placement plan, a “coincidental” share reduction had already begun.

On December 24, 2025, the company issued two shareholder reduction plans:

Shareholder Ningbo Huijin Cheng Venture Capital Partnership (Limited Partnership) plans to reduce no more than 22.6414 million shares, accounting for 2% of total shares. Based on the then-share price of 22.06 yuan, the cash equivalent is approximately 499 million yuan.

Shareholder Zhuhai Lengquan Investment Partnership (Limited Partnership) plans to reduce no more than 11.3207 million shares, accounting for 1% of total shares, with an estimated cash-out of about 250 million yuan.

Although these shareholders are not the actual controllers, the close timing of these reduction plans before the private placement disclosure has raised questions among many investors.

Even more concerning is the mounting pressure on the “Guanyu Convertible Bonds” conversion.

The “Guanyu Convertible Bonds” were issued in October 2022, totaling 3.089 billion yuan. These bonds can be converted into the company’s shares starting April 28, 2023, with an initial conversion price of 23.68 yuan per share, and the current conversion price is 22.89 yuan per share. According to the agreement, if the company’s stock closes below 19.46 yuan (85% of the conversion price) for at least 15 trading days within 30 consecutive trading days, the board can propose a downward adjustment of the conversion price.

As of March 13, 2026, there have been ten trading days with closing prices below 19.46 yuan per share. If the stock price remains weak and triggers the conversion price adjustment clause, existing shareholders’ equity will face further dilution—coinciding with the company’s announcement of a 3.3 billion yuan private placement.

A cycle may be forming: falling stock prices → triggering bond conversion price adjustments → dilution of earnings per share → further stock price pressure → difficulty in issuing new shares → larger discounts on issuance → more severe dilution. In this “spiral,” small and medium investors are the most powerless.

Undoubtedly, becoming a core supplier of Apple’s steel shell batteries is a highlight in Zhuhai Guanyu’s development history. Thanks to their shape and heat dissipation advantages, steel shell batteries indeed meet the power consumption and space requirements of AI smartphones.

But the harsh reality of business is that supply chain dependence is often mutual and fragile.

First, Apple’s “checks and balances.” Apple’s support for suppliers never allows one to dominate. To counterbalance, it will continue to cultivate other potential suppliers while supporting Guanyu. If Guanyu’s capacity, yield, or prices encounter any issues, orders could be diverted at any time. The specialized equipment expanded in this private placement could become scrap if future orders from key clients are lost.

Second, the “arms race” of technical routes. While steel shell batteries are currently popular, next-generation technologies like solid-state batteries and lithium-metal batteries are accelerating from laboratory research to industrialization.

Third, the awkwardness of “revenue growth without profit growth.” In 2025, the company’s revenue grew by 24.74%, but net profit after non-recurring gains and losses fell by 10.38%. This indicates that scale expansion has not improved profitability and may have even lowered overall profit margins. Against the backdrop of raw material price fluctuations and intensified industry competition, large capital expenditures will translate into heavy depreciation and financial costs, further eroding profits.

Note: This article is generated with AI tools and does not constitute investment advice. Markets carry risks; invest cautiously.