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Honghe Technology released its "Announcement on the Results of Shareholder Reduction" after market close on September 22, stating that company shareholders SHARP TONE and UNICORN ACE completed their previously disclosed reduction plans, collectively selling approximately 22.61 million shares and cashing out about 4 billion yuan.

It is understood that these two shareholders are enterprises controlled by the company's actual controller Wang Wenyang and his daughter, and are persons acting in concert with the company's controlling shareholder. After the reduction was completed, the combined shareholding ratio of the company's controlling shareholder and persons acting in concert decreased from 81.7% to 79.2%.

As one of the more dazzling "AI concept stocks" in the A-share market in recent years, Honghe Technology successfully rode the AI wave through its electronic fabric business, with its share price rising from a low of less than 10 yuan per share in 2025 to a peak of 304 yuan per share in June 2026, an increase of more than 45 times.

However, since the reduction plan was announced in June, combined with market fluctuations, the company's share price quickly fell back. As of the close on September 24, Honghe Technology traded at 152 yuan per share, halving from its peak, with a latest market value of approximately 137.5 billion yuan.

It is worth mentioning that with the support of the AI boom, Honghe Technology's first-half performance surged: revenue grew about 90% to 1.048 billion yuan during the period, and net profit attributable to parent company increased 334.32% to 379 million yuan.

According to Hithink RoyalFlush iFinD, from 2014 to the first half of 2026, the company cumulatively recorded a net profit attributable to parent company of 1.498 billion yuan, less than 40% of the amount cashed out by the two major shareholders this time. Under the halo of a hundred-billion market value, Honghe Technology also faces the risk of a share price decline. As of the close on September 24, the company's price-to-earnings ratio (TTM) was 278.32 times, and the static price-to-earnings ratio was 680.97 times. Previously, the company had also repeatedly issued announcements on abnormal stock trading fluctuations, reminding investors to pay attention to relevant risks.

After the Chairman and Board Secretary Reduced Holdings in May, Two Major Shareholders Cashed Out Another 4 Billion

According to the announcement released by Honghe Technology on September 22, in June of this year, the company disclosed the reduction plans of SHARP TONE INTERNATIONAL LIMITED (hereinafter referred to as "SHARP TONE") and UNICORN ACE LIMITED (hereinafter referred to as "UNICORN ACE"). At that time, SHARP TONE planned to reduce its holdings of the company's shares through centralized bidding, with a total of no more than 9.05 million shares, or no more than 1% of the company's total share capital. UNICORN ACE planned to reduce its holdings of the company's shares through block trades, with a total of no more than 13.57 million shares, or no more than 1.5% of the company's total share capital.

The implementation results of the reduction show that during the reduction period, SHARP TONE and UNICORN ACE respectively reduced 9.05 million shares and 13.57 million shares, with reduction price ranges of 139.96~244.85 yuan per share and 108.62~209.91 yuan per share respectively. The total reduction amounts of the two were 2.037 billion yuan and 1.932 billion yuan respectively, totaling approximately 4 billion yuan.

After completing the reduction, SHARP TONE and UNICORN ACE respectively held 16.96 million shares and 15.24 million shares of the company, accounting for 1.87% and 1.68% of the company's total share capital.

The 2025 annual report of Honghe Technology shows that the above reduction entities formed a concerted action relationship with the company's controlling shareholder Far East International Limited, INTEGRITY LINK, and FUSECREST, controlled by the company's actual controller Wang Wenyang and his daughter Grace Tsu Han Wong (Wang Sihan). After this reduction was completed, the shareholding ratio of the aforementioned persons acting in concert decreased from 81.7% to 79.2%.

It is worth noting that on May 11 and 12 of this year, Honghe Technology's chairman and general manager Mao Jiaming reduced 240,700 shares of the company (0.0266% of total share capital) through centralized bidding, with a reduction price range of 141.15~152 yuan per share, cashing out approximately 35.64 million yuan. During the same period, the company's board secretary Zou Xin'e also reduced 75,000 shares (0.0083% of total share capital) through centralized bidding, with a reduction price range of 143.78~148.36 yuan per share, cashing out approximately 10.95 million yuan.

AI Drives Performance Surge, Largest Customer's Revenue Share Rises

According to Tianyancha, Honghe Electronic Materials Technology Co., Ltd. was registered and established in 1998, and later listed on the Shanghai Stock Exchange Main Board in July 2019. The company's main business is the research and development, production and sales of high-end electronic-grade glass fiber cloth and electronic-grade glass fiber yarn.

In terms of performance, in the first half of this year, Honghe Technology delivered a remarkable report card. During the reporting period, the company achieved revenue of 1.048 billion yuan, a year-on-year increase of 90.39%; it recorded a net profit attributable to parent company of 379 million yuan, a year-on-year increase of 334.32%, exceeding the company's full-year net profit attributable to parent company of 202 million yuan last year.

In the first half of the year, Honghe Technology's gross profit margin and net profit margin were 59.34% and 36.22% respectively, an increase of 27.98 and 20.34 percentage points from the same period last year.

Honghe Technology stated in its financial report that the main reasons for its performance increase were the strong market demand for ordinary E-glass electronic-grade glass fiber cloth during the reporting period, with prices rising year-on-year, plus the strong market demand in the first half of 2026 for special electronic cloth such as low dielectric constant electronic cloth and low thermal expansion coefficient electronic cloth. The company's production capacity continued to increase, sales volume and unit selling price rose year-on-year, and such products have high technical barriers and high added value.

By region, in the first half of the year, the company's revenue from mainland China reached 882 million yuan, accounting for 84.22% of total revenue; other Asian regions were the second largest source of the company's revenue, contributing 147 million yuan during the period, accounting for 14% of total revenue.

By product, the company's electronic-grade glass fiber cloth (including E-glass fiber cloth and special electronic cloth) sales collectively contributed 1.033 billion yuan in revenue, accounting for 98.56% of revenue.

It is reported that as an indispensable material for producing copper clad laminate (CCL), electronic cloth is the basic material for producing printed circuit boards. Honghe Technology holds an important position in the global high-end electronic cloth field and is one of the few manufacturers in the world with ultra-thin cloth production capacity. Its downstream customers include well-known companies such as Shengyi Technology, Lianmao Electronics, Taiguang Group, Taiyao Technology, and Nanya New Material.

In the first half of 2026, the rapid development of technologies such as artificial intelligence, big data, and cloud computing drove explosive growth in global computing power demand, further driving market demand for the upstream core substrate electronic-grade glass fiber cloth, and Honghe Technology is positioned at the upstream chokepoint of this industry chain.

At the company's 26th anniversary celebration, chairman Mao Jiaming excitedly stated: "This year is the best operating year in Honghe's history — the AI wave has spawned explosive demand for high-end electronic cloth, and Honghe's 26 years of focus have allowed us to stand firmly on the forefront."

It is worth mentioning that in the first half of this year, Honghe Technology's revenue from its largest customer was 315 million yuan, accounting for 30.08% of the company's total revenue. For the full year last year, the company's revenue from its largest customer was 236 million yuan, accounting for 20.14% of the company's total revenue.

Taiwan Plastics "Abandoned Heir" Builds a Hundred-Billion Electronic Cloth Leader

Public information shows that Honghe Technology's 75-year-old founder Wang Wenyang is the eldest son of Wang Yongqing, founder of the Taiwan Plastics Group. Founded in 1954, the Taiwan Plastics Group is one of the largest private enterprises in Taiwan, China, founded by the two Wang brothers. After more than 70 years of development, the Taiwan Plastics Group's business has gradually expanded from initial plastics production to numerous sectors including petroleum and energy, chemicals, plastics, electronics, steel, transportation and vehicles.

Born into a "wealthy family," Wang Wenyang studied in the UK as a teenager, then entered the Royal College of London and obtained a doctorate in physics. In 1978, Wang Wenyang joined the Taiwan Plastics Group, and in 1993 took charge of Nan Ya Technology, becoming the core of the group, and was once regarded as the successor of the Taiwan Plastics Group.

But in 1995, Wang Wenyang was dismissed by his father due to a scandal, stripped of his equity, and expelled from the Taiwan Plastics Group. After several twists and turns, Wang Wenyang came to the mainland and started his entrepreneurial journey riding the spring breeze of reform and opening up.

Under the influence of his father's generation for many years, Wang Wenyang still engaged in his most skilled old trade, successively founding Guangzhou Hongwei Chemical Industry Co., Ltd. (predecessor of Hongchang Electronics) and Hongren Group, mainly focusing on electronic materials, plastic processing and other industrial fields.

In 1998, Wang Wenyang also took two key steps: first, investing in and establishing Shanghai Honghe Electronic Materials Co., Ltd. (predecessor of Honghe Technology) in Shanghai, focusing on mid-to-high-end electronic-grade glass fiber cloth; second, incorporating Hongchang Electronics into the core territory of Hongren Group, simultaneously advancing the dual-track layout of "resin + electronic cloth."

As the company gradually got on track, Wang Wenyang decisively abandoned the low-end market, leading Honghe Technology to concentrate all resources on developing ultra-thin electronic cloth with a thickness of less than 28 microns; Hongchang Electronics focused on high-purity, low-chlorine electronic-grade epoxy resin, both locking onto high-end tracks.

Entering the 21st century, Hongchang Electronics took the lead, listing on the Shanghai Stock Exchange in 2012. Seven years later, Honghe Technology also successfully landed in the A-share capital market. These two listed companies have also become important components of the Wang Wenyang family's business territory.

It is worth mentioning that according to Changjiang Business Daily, in 2005, Wang Wenyang completed the equity transfer, transferring 64.97% of Hongren Group's shares to his daughter Wang Sihan, retaining only 0.19% for himself. However, major business decisions of Hongren Group, Honghe Technology, and Hongchang Electronics are still jointly decided by the father and daughter.

It is worth mentioning that in the "2026 Hurun Global Rich List" announced in March this year, Wang Wenyang and Wang Sihan had a net worth of 25 billion yuan. As of the close on September 24, the total market values of Hongchang Electronics and Honghe Technology were 21.8 billion yuan and 137.5 billion yuan respectively. Regarding the subsequent development of Honghe Technology, Radar Finance will continue to pay attention.