Zhongyan Technology Co Ltd

The State Council executive meeting decided to approve four nuclear power projects totaling eight units: the second phase of the Jinqimen Nuclear Power Plant in Zhejiang, the third phase of the Taipingling Nuclear Power Plant in Guangdong, the first phase of the Zhuanghe Nuclear Power Plant in Liaoning, and the first phase of the Laiyang Nuclear Power Plant in Shandong. This marks the first nuclear project approval of 2026 and the first batch approved during the 15th Five-Year Plan period. Total investment for these new projects will exceed 170 billion yuan. Boosted by the news, the nuclear power concept sector in the A-share market surged against the overall market trend. China Nuclear Engineering, LBT, Jiangsu Shentong, and Zhongyan Technology hit their daily limit up, while Western Metal Materials, Dongfang Electric, and China National Nuclear Corporation Technology followed with gains. China Galaxy Securities estimates that the eight domestically produced million-kilowatt third-generation nuclear units involve investment of over 170 billion yuan, which could drive total output of related industrial chains to approximately 500 billion yuan, directly benefiting the entire chain including nuclear equipment manufacturing, nuclear island construction, nuclear fuel cycle, and operation and maintenance. Caitong Securities believes this approval confirms the trend of large-scale and regularized nuclear power construction during the 15th Five-Year Plan period, continuously strengthening the sector's medium- to long-term prosperity and growth certainty.

On August 3, the three major A-share indices weakened. The Shanghai Composite Index fell 0.51%, the Shenzhen Component Index dropped 0.80%, the ChiNext Index declined 1.24%, and the STAR Composite Index lost 1.55%. Nuclear power concept stocks were active. Changfu Shares surged over 18%, while China Nuclear Engineering, LBT, and Zhongyan Dadi hit their daily limit up. Rongfa Nuclear Power, China National Nuclear Corporation, and Western Metal Materials also rose. On the news front, a State Council executive meeting on July 31 approved four nuclear power projects, including the first phase of the Liaoning Zhuanghe project. The total investment for these new projects is estimated to exceed 170 billion yuan. Semiconductors, precious metals, and glass fiber sectors led the declines. The Hong Kong stock market fluctuated higher, with Alibaba rising over 6%.

The State Council executive meeting approved four nuclear power projects, including the first phase of the Zhuanghe project in Liaoning, totaling eight new units with an overall investment exceeding 170 billion yuan. Boosted by this news, the nuclear energy concept sector strengthened on August 3, with multiple stocks including China Nuclear Engineering, LIBERTY, Jiangsu Shentong, and Zhongyan Technology hitting their daily limit. GF Securities noted that nuclear power approvals have become routine, with eight to eleven units approved annually from 2022 to 2026, and the fifteenth Five-Year Plan period will see a peak in commissioning. However, market expectations fueled by policy tailwinds do not equate to listed companies' performance. Even within the nuclear power concept, corporate results vary. For example, China Nuclear Engineering's first-quarter 2026 revenue and net profit attributable to the parent fell 22.14 percent and 26.93 percent year-on-year respectively, while equipment manufacturer Hailu Heavy Industry saw revenue and net profit rise 6.77 percent and 40.33 percent year-on-year over the same period. Analysts believe the August 3 rally was more of a concentrated pricing of industry outlook expectations, and whether the momentum can be sustained depends on project progress, order realization, and the genuine delivery of profits and cash flow.

Zhongyan Dadi announced plans to acquire a 60% stake in PCB drill bit manufacturer Xinhuanyu through a combination of cash purchase and capital increase, with a total transaction consideration of 240 million yuan. Under the framework agreement, Zhongyan Dadi will use Xinhuanyu's pre-investment valuation of 250 million yuan as the basis, paying 90 million yuan to acquire a 36% stake from existing shareholders, and then injecting an additional 150 million yuan to obtain a 37.5% stake after the capital increase. Xinhuanyu has made a performance commitment of total non-recurring net profit of no less than 100 million yuan from 2026 to 2028, but its 2025 revenue was 39.13 million yuan with a net loss of 1.31 million yuan, and net profit for the first five months of this year was 2.75 million yuan. Zhongyan Dadi expects a net loss attributable to shareholders of 12 million to 18 million yuan in the first half of the year. The company stated that this cross-border move is a strategic plan to cultivate a second growth curve, and noted that the payment has been structured with phased mitigation measures. As of the end of the first quarter, it had monetary funds of 184 million yuan and trading financial assets of 417 million yuan, indicating ample liquidity. Leading PCB drill bit companies point out that new entrants face barriers such as difficulty in obtaining production equipment and long talent training cycles, and demand in the coming period will still be mainly absorbed by the leading players.