Zhenghong Technology intends to apply for credit facilities not exceeding 100 million yuan and provide guarantees not exceeding 60 million yuan.

Radar Finance Text | Yang Yang Edited | Li Yihui

On March 19, Zhenghong Technology (Stock Code: 000702) announced that the company and its subsidiaries plan to apply for a comprehensive credit line of 100 million RMB from banks, which can be used repeatedly within the credit period. The company will provide guarantees for the comprehensive credit line applied for by its wholly-owned subsidiaries Hunan Zhenghong Yingtian Feed Co., Ltd., Hunan Zhenghong Lide Feed Co., Ltd., and Anhui Huaibei Zhenghong Feed Co., Ltd., with an estimated total new guarantee amount not exceeding 60 million RMB.

The specific guarantee amounts and guarantee periods will be executed according to the contractual agreement. The application for the comprehensive credit line and the guarantee provision still require approval by the company’s shareholders’ meeting, valid for 12 months from the date of approval. The guaranteed parties are all controlled subsidiaries within the company’s consolidated financial statements, currently operating well and capable of repaying debts.

As of the announcement date, the total guarantee amount for the company and its controlling subsidiaries is 610 million RMB, with a total guarantee balance of 143.18 million RMB, accounting for 39.43% of the company’s latest audited net assets.

According to Tianyancha data, Zhenghong Technology was established on March 12, 1997, with a registered capital of 346.624948 million RMB. The legal representative is Yi Xing, and the registered address is No. 199 Yungang Road, Yunxi Street, Yunxi District, Yueyang City, Hunan Province. Its main business includes research and development, production, and sales of feed products, pig farming, and sales of feed raw materials.

Currently, the company’s chairman is Yi Xing, the secretary of the board is Liu Hao, with 639 employees. The actual controller is the Yueyang Chenglingji Comprehensive Bonded Zone Management Committee.

The company has stakes in 26 affiliated companies, including Zhenghong Group (Suqian) Agricultural Development Co., Ltd., Hunan Zhenghong Lide Feed Co., Ltd., Hunan Zhenghong Lingsheng Labor Service Co., Ltd., Hunan Zhenghong Juncheng Labor Service Co., Ltd., and Hunan Zhenghong Yingtian Feed Co., Ltd.

In terms of performance, the company’s operating revenue for 2022, 2023, and 2024 was 1.161 billion, 1.241 billion, and 1.121 billion RMB, respectively, with year-over-year changes of -18.89%, 6.90%, and -9.69%. The net profit attributable to shareholders was -116 million, -140 million, and -65.25 million RMB, with year-over-year growth rates of 48.29%, -20.58%, and 53.34%. During the same period, the company’s asset-liability ratio was 85.28%, 53.91%, and 57.53%.

Regarding risks, Tianyancha data shows the company has 452 internal Tianyan risks, 126 surrounding risks, 1,827 historical risks, and 243 warning alert risks.