Yanjiang 300658 plans significant asset reorganization through acquisition of high-tech company

In recent days, the stock of Yanjiang Co., Ltd. (300658) has attracted investor attention with a noticeable increase in share prices. The precondition for this was an unexpected market announcement about plans for a significant corporate merger and acquisition, signaling a radical strategic shift for the company.

The Strategic Shift Behind the Stock Price Surge

On January 4, 2026, in the evening, Yanjiang Co., Ltd. revealed ambitious intentions to acquire control of Ningbo Yongqiang Technology Co., Ltd. through issuing shares and raising cash. This move caught the market by surprise and already had a significant impact on the stock: the previous trading day (December 31, 2025), shares rose by over 11%, reaching 14.82 yuan per share. The company’s market capitalization grew to 4.9 billion yuan.

What caused such a strong market reaction to simple words about asset reorganization? The answer lies in the company’s long-term strategy and the specifics of the target acquisition.

Yongqiang Technology: Why This Company?

Ningbo Yongqiang Technology Co., Ltd. is not just another manufacturing company. Founded in 2019, it has established itself as a leading developer and manufacturer of high-tech materials for electronics. Its main focus includes IC substrates, display substrates, and high-speed substrates, which are actively used in cutting-edge communications (5G/6G), artificial intelligence, data centers, and internet of vehicles.

As of the previous agreement (December 31, 2025), Yanjiang Co., Ltd. reached an understanding with the main controller of Yongqiang Technology, JIANGQIHE, as well as its partners QIANGYUAN and Ningbo Yuanlu Zai Technology Partnership, regarding the general principles of the deal. Details of the acquisition scheme and share distribution are still under negotiation.

Yongqiang Technology’s valuation exceeds 1 billion yuan, reflecting results from several successful funding rounds. The company’s client base includes global giants like Intel, Huawei, Inspur, Sugon, New H3C, and Accelink, indicating reliability and quality in its manufacturing solutions.

From Hygiene Materials to Chips: Why Such a Transformation?

It’s important to understand the scale of these changes. Currently, Yanjiang Co., Ltd. specializes in developing and manufacturing surface materials for disposable hygiene products—3D perforated non-woven fabrics and perforated PE films used in feminine hygiene products, baby diapers, and similar items. Its main clients include global leaders like Procter & Gamble, Kimberly-Clark, and Hengan.

This means Yanjiang is transitioning from one industry to another—acquiring Yongqiang Technology will have an inter-industry nature. Such a strategy was announced in the 2024 annual report, where the company identified a priority task for 2025 as “cautious selection, development, and formation of new industry directions” to facilitate further growth.

Factors Supporting Yanjiang’s Core Business Stability

This ambitious move is possible thanks to the stable development dynamics of the company’s traditional business. For the first three quarters of 2025, Yanjiang Co., Ltd. reported revenue of 1.295 billion yuan, a 22.99% increase year-over-year. Net profit reached 42.5018 million yuan, up 27.95%.

Even more impressive is the third quarter alone: net profit hit 16.6626 million yuan, demonstrating a staggering 209.1% year-over-year growth. These figures indicate that Yanjiang’s core business remains attractive, providing the company with financial flexibility to expand into new sectors.

Global Expansion as a Foundation for Future Growth

Alongside its main business, Yanjiang is steadily deploying a global strategy for establishing manufacturing capacities. Currently, the company has local plants in Egypt, the USA, and India. Since 2022, subsidiaries “Singapore Holdings” and “Yanjiang International” have been developing according to strategic goals and have already achieved certain results.

Large foreign clients are gradually updating material specifications, shifting to medium- and high-quality series. The Egyptian subsidiary already demonstrates a production capacity of about 10,000 tons per year, with plans to reach full capacity (12,000 tons annually) in the first half of 2026. Commercial production in the USA is scheduled to start in 2026.

Profitability Outlook and Investment Potential

Regarding profitability metrics of the parent and its subsidiaries, a consistent year-over-year growth is observed. The Egyptian subsidiary has shown particularly notable profit growth, while operations in the US and India are near break-even.

This profile suggests that if the overseas expansion continues on its current course, it will create new momentum for an already profitable business. Additionally, integrating high-tech Yongqiang Technology into Yanjiang’s asset portfolio will give the company access to promising markets in chips and electronics—sectors with significantly higher margin potential.

For investors watching Yanjiang’s stock, this asset reorganization could signal a prolonged period of stock value growth, supported by both the core business and new strategic investments in high-tech sectors.