Zhangjiagang Guangda Special Material Co., Ltd. (688186)

Single-Stock Analysis Report | Industry: High-end Equipment Special Steel Materials and Components (Wind Power Industry Chain) | Report Date: September 13, 2026 | The research notes do not provide a unified market-data cutoff date/time; only some fragments contain date clues (e.g., 2026-09-09 15:18:11 Beijing time, June 30, 2026 shareholder list, September 9 to September 11 fund flows, 2026 Q1 report, etc.), and the time points corresponding to each data item are inconsistent, so a unified price cutoff date cannot be confirmed.

This report is automatically compiled and generated by AI based on public information, for reference only, and does not constitute investment advice.

1. Core Summary

Guangda Special Material's 2026 H1 results deteriorated significantly: revenue of RMB 2.323 billion, down 8.36% year-on-year; net profit attributable to parent of RMB 12.3436 million, down 93.33% year-on-year; non-GAAP net profit attributable to parent down 93.67% year-on-year; gross margin of approximately 13.50%, and net cash flow from operating activities of -RMB 231 million. Q2 standalone net profit attributable to parent was RMB 7.0772 million, down 93.62% year-on-year, indicating that the earnings pressure was not a single-quarter fluctuation in Q1. It should be noted that gross margin, cash flow and some financial indicators mainly come from secondary sources, and the company's original semi-annual report should ultimately prevail.

In 2025, the company achieved revenue of RMB 4.909 billion and net profit attributable to parent of RMB 206 million, up approximately 22.6% and 79.6% year-on-year respectively, with main business gross margin rising to 17.33%. Its business covers advanced basic materials, wind power mechanical components, steam turbine components and other high-end equipment components. In 2025, new energy wind power revenue accounted for 57.16%, and wind power mechanical components gross margin was 22.93%, higher than the 12.51% for advanced basic materials. However, net profit attributable to parent for the first three quarters of 2025 was approximately RMB 249 million, while the full year was only RMB 206 million, implying that a loss had already appeared in Q4, indicating that the previous high growth had already been interrupted by year-end.

The company is in the midstream processing segment, as a price-taker on upstream raw materials and facing relatively high downstream customer concentration. Scrap steel, alloys and pig iron together accounted for approximately 57%–62% of total material procurement. In 2023, the top five customers accounted for 70.67% of sales revenue, and at the end of June 2026, the top five customers accounted for 49.78% of accounts receivable and contract assets. Therefore, profitability is relatively sensitive to raw material prices, procurement carryover lags, downstream price pressure and changes in order delivery. In 2026 H1, the company explained that the decline in performance was mainly related to reduced new wind power installations, declining order delivery, lower capacity utilization, higher unit fixed costs, depreciation dilution in the initial stage of production for fundraised projects, and a decrease in VAT additional deductions.

The company still possesses integrated capabilities in special steel materials and high-end components, and has extended into high-temperature alloys, controllable nuclear fusion and commercial aerospace, among other directions; materials related to controllable nuclear fusion have already been supplied in batches and the company won the bid for the BEST coil box machining project, but the revenue and profit contributions of these new businesses have not yet been disclosed. Recently, the company completed the second phase of share repurchases of 9.08 million shares, accounting for 3.2372% of total share capital, and implemented the 2026 employee stock ownership plan, but there are differences in certain data such as the number of shares held in the repurchase account and total share capital. On the technical side, market materials show two prices, RMB 13.66 and RMB 13.93, while key data such as moving averages, Bollinger Bands, swing highs and lows, and turnover rate are missing, which is temporarily insufficient to form a reliable trend judgment.

2. Company Overview

2.1 Basic Information

2.2 Main Business and Product Layout

• Special steel materials (advanced basic materials): gear steel, die steel, high-temperature alloys, special stainless steel (including ultra-high-strength steel)
• Components (alloy products/wind power mechanical components, etc.): wind power castings (hubs, elbows/bases, yaw supports, cast flanges, gearbox housings, cast main shafts), wind power main shafts, gearbox components (pins, planetary gears, sun gears, ring gears, high-speed shafts), steam turbine components, cast steel parts for energy and power equipment, other components
• Four major product categories in the 2025 annual report product matrix: advanced basic materials, wind power mechanical components, steam turbine components, other components
• Downstream application fields: new energy wind power, energy equipment, rail transit, mechanical equipment, military equipment, aerospace, nuclear energy/nuclear power, marine petrochemicals, semiconductor chip equipment, and extension into controllable nuclear fusion (materials for superconducting coil armor have been supplied in batches, and the company won the bid for the BEST coil box machining project) and the commercial aerospace concept (stainless steel products are said to "already meet the conditions for aerospace applications")
• 2025 main business composition (revenue of approximately RMB 4.909 billion): by industry—high-end equipment components RMB 3.206 billion (65.32%, gross margin 19.74%), high-end equipment special steel materials RMB 1.601 billion (32.62%, gross margin 12.51%); by product—wind power mechanical components RMB 1.800 billion (36.68%, gross margin 22.93%), advanced basic materials RMB 1.601 billion (32.62%, gross margin 12.51%), steam turbine components RMB 1.231 billion (25.08%, gross margin 14.64%), other components RMB 175.1 million (3.57%, gross margin 22.73%) (East Money main business composition page)
• 2026H1 main business composition (basis switched to "alloy products/alloy materials"): alloy products RMB 1.557 billion (67.04%, gross margin 14.17%), alloy materials RMB 733.4 million (31.58%, gross margin 11.68%); by region—domestic RMB 2.254 billion (97.05%), overseas RMB 68.41 million (2.95%)
• Share of main business revenue from new energy wind power: 55.80% in the 2024 annual report, 57.16% in the 2025 annual report (original annual report text; the basis is consistent in both places)
• Performance anchors: 2024 revenue RMB 4.003 billion (+5.67%), net profit attributable to parent RMB 115 million (+4.97%), non-GAAP RMB 74 million (+1.19%); 2025 revenue RMB 4.909 billion (+22.62%), net profit attributable to parent RMB 206 million (+79.60%), non-GAAP RMB 206 million (+176.37%), main business gross margin 17.33% (+0.90pct), R&D investment RMB 195 million, cumulative authorized patents 255 (including 136 invention patents), cumulative core technologies 64
• Major inflection point in 2026H1 performance: revenue RMB 2.323 billion (YoY -8.36%), net profit attributable to parent RMB 12.3436 million (YoY -93.33%), non-GAAP RMB 11.3168 million (-93.67%); Q2 standalone net profit attributable to parent RMB 7.0772 million (-93.62%); gross margin approximately 13.5%, debt-to-asset ratio 59.73%, financial expenses RMB 68.7796 million (Stockstar weekly review 2026-09-12; this data was read only from a single secondary source and was not cross-verified in the original SSE 2026 interim report; the company's semi-annual report should be taken as authoritative)
• 2025H1 comparison base: revenue RMB 2.534 billion, net profit attributable to parent RMB 185 million, gross margin 20.71% (inferred from the same source above for comparison, not cross-verified with the original interim report)

2.3 Position in the Industry Chain Upstream and Downstream, and Cost-Profit Structure

The company is an integrated enterprise in high-end equipment special steel materials and components. On the upstream cost side, it uses bulk raw materials such as scrap steel/alloys/pig iron and is a price-taker; on the downstream side, it serves a relatively concentrated customer group including wind power OEMs and gearbox manufacturers. Overall, it occupies a "midstream processing, relatively thin margin" position in the industry chain.

• Actual procurement categories: scrap steel (carbon steel, nickel steel, chrome-molybdenum steel, high-alloy scrap steel, etc.), alloys (ferronickel, ferromolybdenum, ferrochrome, etc.), pig iron; the company itself states that "scrap steel is the raw material with the largest procurement share," and because scrap steel is a renewable resource, it has industry-specific characteristics.
• Share data (multiple periods, strong basis consistency): scrap steel + alloys + pig iron together accounted for 61.54% of total material procurement in 2021, 61.17% in 2022, and 57.45% in the 2023 annual report (all above 60%/close to 60%).
• The convertible bond prospectus (2022-10-10) lists the breakdown (four reporting periods, late to early): scrap steel 49.05%/46.15%/53.35%/71.46%; alloys 5.03%/8.33%/6.49%/9.42%; pig iron 6.92%/7.06%/11.91%/—.
• Bargaining position: the company itself states that "the procurement market for scrap steel, alloys and pig iron is fully competitive, with relatively fast information transmission"—that is, it is a price-taker relative to upstream suppliers, costs fluctuate with bulk commodities, and the company explicitly notes that "it takes a certain period for raw material price declines to be reflected in performance" (there is a procurement-cost carryover lag).
• For nickel/chromium-containing special scrap steel, the company needs to purchase scrap steel with high alloy content, at a higher unit price (for example, in 2022, the average procurement price of nickel-chromium-containing scrap steel supplied by Sichuan Kanglin Metal was RMB 7,918.66/ton, mainly supplying Guangda Dongqi cast steel parts with higher molybdenum-nickel content).
• Supplier concentration: in 2022, three new top-five suppliers were added, with total procurement of RMB 355 million, accounting for 13.36% (2022 annual report inquiry response); no more complete disclosure of supplier concentration in recent years was seen, and this is a single-year data point.
• Customer list (disclosed by the company/announcements): rail transit—units under CRRC Group; wind power—Nanjing High Speed Gear/China Transmission, Siemens, ZF, Mingyang Smart Energy, units under Dongfang Electric Group; military and nuclear power—units under CSIC, units under Shanghai Electric; aerospace—units under CASIC and AVIC; mechanical equipment—Jacquet, thyssenkrupp, voestalpine IS; molds—Huawei Mold, Kejia Mold.
• Major orders: on 2025-03-12, the company announced the signing of the "2025 Framework Procurement Contract for Wind Turbine Generator Components" with Mingyang Smart Energy, amounting to RMB 1.505 billion (tax included), supplying hubs, bases, main shafts, etc. (Minsheng Securities 2025-04-23 commentary); in 2021, it established a joint venture with Dongfang Electric (Guangda Dongqi).
• Customer concentration (disclosed values, by year): top five customers in 2016/2017/2018 accounted for 60.16%/51.09%/39.06%; in the 2023 annual report, the top five customers' sales were RMB 2.621 billion, accounting for 70.67% of annual total sales (first to fifth were 29.82%/17.94%/15.98%/4.39%/2.54% respectively); in 2024, a secondary-source basis showed the top five customers' combined sales were RMB 2.511 billion, accounting for 63.79% of operating revenue (single/secondary source, unable to be cross-verified with the original annual report, and the denominator under this basis does not fully match revenue of RMB 4.003 billion; doubtful, and the annual report should be taken as authoritative); the 2022 year-end inquiry response disclosed it but this summary does not include specific values.
• Industry chain bargaining dynamics: downstream are wind power OEMs/gearbox manufacturers (Mingyang Smart Energy, Nanjing High Speed Gear, Siemens, ZF, etc.). From 2022 to 2024, the industry experienced "severe involution," and casting product prices hit new lows (original wording in the company's 2024 annual report; the summary excerpt ends here and does not include the full subsequent statement); combined with the company being a price-taker upstream, the company is in a midstream processing position of being "squeezed from both ends."
• Accounts receivable/contract asset concentration (annual report notes): as of 2026-06-30, the top five customers accounted for 49.78% of accounts receivable and contract assets (49.92% at 2025-12-31; 52.92% at end-2023; 53.54% at end-2022)—customer concentration is high but has slightly declined in a stable manner in recent years, indicating no obvious improvement in bargaining relationships; 2026H1 debt-to-asset ratio was 59.73%, and financial expenses were RMB 68.7796 million (secondary source, not cross-verified with the original interim report). More detailed working capital occupation indicators such as accounts receivable turnover days, prepayments/accounts payable did not appear as citable specific values in this research summary, and the data is missing.
• Customer concentration: top five customers accounted for 70.67% in the 2023 annual report (annual report basis), while in 2024 a secondary source showed the top five customers accounted for 63.79% (single-source data, unable to be cross-verified with the original annual report, and the denominator does not fully match revenue of RMB 4.003 billion; specifics should be based on the latest annual report); top five share of accounts receivable/contract assets was 49.78% as of 2026-06-30, sourced from annual report notes. Supplier concentration only has 2022 data (three new top-five suppliers together accounted for 13.36%), and no more complete disclosure over the years was seen.

The company is positioned in the midstream processing segment of the smile curve: upstream scrap steel/alloys/pig iron are price-takers, costs fluctuate with bulk commodities and there is a procurement-cost carryover lag; downstream wind power OEMs and gearbox manufacturers have high customer concentration (top five customers accounted for 70.67% in 2023), and from 2022 to 2024 the industry experienced "severe involution" and casting prices hitting new lows. Being squeezed from both ends determines its overall relatively thin gross margin (2025 main business gross margin 17.33%, sharply dropping to approximately 13.5% in 2026H1). The drivers for further gross margin improvement are not vague statements such as "intense industry competition," but rather three specific paths: first, shifting the product mix toward higher-margin wind power mechanical components (2025 gross margin 22.93%) and other components (22.73%) while reducing the share of lower-margin advanced basic materials; second, continuously reducing costs and improving efficiency through process improvement, lean management and supply chain optimization (original wording in the 2025 annual report); third, waiting for a recovery in downstream wind power tendering and the casting price cycle, as well as the scale effect brought by new capacity ramp-up in gearboxes/high-end materials, thereby restoring bargaining power over upstream and downstream.

3. Financial Data and Valuation Analysis

3.1 Recent Operating Performance

Data collection time point: the reporting dates shown on retrieved public pages are mainly concentrated from 2025-04 to 2026-09; the latest financial report is the 2026 interim report, and the latest market data basis is approximately 2026-09-12. The 2026 interim report disclosure date was 2026-08-24/25 (sources: jiemian.com/article/14984841.html; stock.stockstar.com/RB2026082600008273.shtml; finance.eastmoney.com/a/202608243851132257.html, etc.). Other 2026 interim report data: total profit RMB 40.2498 million, YoY -83.15%; overall gross margin 13.5% (Stockstar basis); debt-to-asset ratio 59.73%; financial expenses RMB 68.7796 million; net cash flow from operating activities -RMB 231 million (Stockstar/Jiemian basis, turning to a large net outflow year-on-year). By product (East Money main business composition, 2026-06-30): alloy products RMB 1.557 billion (67.04%, YoY -8.98%, gross margin 14.17%); alloy materials RMB 733.4 million (31.58%, YoY -5.87%, gross margin 11.68%); other RMB 32.07 million. By region: domestic RMB 2.254 billion (97.05%), overseas RMB 68.41 million (2.95%). 2025 by product: wind power mechanical components RMB 1.800 billion (36.68%, gross margin 22.93%), advanced basic materials/high-end equipment special steel materials RMB 1.601 billion (32.62%, gross margin 12.51%), steam turbine components RMB 1.231 billion (25.08%), other components RMB 175.1 million; by industry: high-end equipment components RMB 3.206 billion (65.32%, gross margin 19.74%), high-end equipment special steel materials RMB 1.601 billion (32.62%, gross margin 12.51%). Important cross-finding: revenue for the first three quarters of 2025 was RMB 3.775 billion and net profit attributable to parent was RMB 249 million, but full-year net profit attributable to parent was only RMB 205.9 million, meaning 2025Q4 standalone net profit attributable to parent was a loss of approximately RMB 43 million, indicating that the high growth in 2025 was interrupted in Q4 and further deteriorated in 2026H1 (sources: stock.quote.stockstar.com/finance/summary_688186.shtml; baike.baidu.com citing 2025 Q3 report forecast of RMB 3.7 billion/248 million). Annual data sources also include stockanalysis.com/quote/sha/688186/financials/ (revenue 4,697/4,909/4,003/3,788 million; net profit 33.14/205.89/114.64/109.21 million), bochk.etnet.com.hk, ft.com profile (TTM revenue RMB 4.7 billion, net profit RMB 33.14 million). There is doubt regarding the total share capital basis: most market sources show 280.49 million shares (280.4894 million shares, Sohu Securities; Huaxi Securities F10 shows 280 million shares), but Baidu Baike states that after canceling 8 million repurchased shares in June 2025, total share capital fell from 230.5937 million shares to 222.5937 million shares; reverse calculation from EPS (2025 attributable to parent RMB 205.9 million ÷ RMB 0.7340 = 280 million shares) supports the 280 million share basis, so 280.49 million shares should be adopted as the current basis, and the Baidu Baike figure is suspected to be outdated/partial and is marked as uncertain. Industry classification bases are inconsistent: East Money "Steel," Sohu/Baidu "Power Equipment - Wind Power Equipment - Wind Power Components"; attention should be paid to basis differences when making peer valuation comparisons.

The company's 2026 H1 performance deteriorated sharply: revenue fell 8.36% year-on-year to RMB 2.323 billion, net profit attributable to parent fell 93.33% year-on-year to RMB 12.3436 million, non-GAAP attributable to parent fell 93.67% year-on-year, basic EPS was RMB 0.04 (YoY -95.35%), total profit fell 83.15% year-on-year, overall gross margin was 13.5%, and net cash flow from operating activities was -RMB 231 million, turning to a large net outflow year-on-year. Q2 standalone net profit attributable to parent was RMB 7.0772 million, down 93.62% year-on-year, continuing the sharp decline in Q1 (2026Q1 attributable to parent YoY approximately -92.9%). Combined with historical data, net profit attributable to parent for the first three quarters of 2025 was RMB 249 million, while the full year was only RMB 205.9 million, implying a 2025Q4 standalone loss attributable to parent of approximately RMB 43 million, indicating that the high growth in 2025 was interrupted in Q4 and further deteriorated in 2026H1. By product, alloy product revenue fell 8.98% year-on-year with gross margin of 14.17%, alloy material revenue fell 5.87% year-on-year with gross margin of 11.68%, domestic revenue accounted for 97.05%, and overseas only 2.95%. There is an uncertainty regarding the total share capital basis (280.49 million shares vs. Baidu Baike's 222.59 million shares), and reverse calculation from EPS supports the 280.49 million share basis.

3.2 Earnings Forecasts

Institutional earnings forecast sources: East Money F10 institutional forecasts (page basis: "average over the past six months"), EPS 2026E RMB 1.195 (2 firms), 2027E RMB 1.560 (2 firms), 2028E RMB 1.570 (1 firm), 2025A RMB 0.7340; net profit attributable to parent 2026E RMB 334.8 million (2 firms), 2027E RMB 437.7 million (2 firms), 2028E RMB 440.4 million (1 firm); total operating revenue 2026E RMB 5.529 billion, 2027E RMB 6.407 billion, 2028E RMB 7.269 billion; operating profit 2026E RMB 376.8 million, 2027E RMB 492.2 million, 2028E RMB 552.9 million; ROE 2026E 8.70%, 2027E 10.98%, 2028E 7.96%; net assets per share 2026E RMB 17.79. Source: emweb.securities.eastmoney.com/ProfitForecast/index?code=SH688186. Another basis (Tongdaxin/Chaguwang, update date 2026-09-05, past 6 months): 2026E/2027E/2028E revenue RMB 5,257/6,151/7,269 million (RMB 5.257/6.151/7.269 billion), net profit attributable to parent RMB 269.64/342.36/440.35 million (RMB 270/342/440 million), EPS RMB 0.96/1.22/1.57, essentially equivalent to the single-broker Huatai model. Source: ddx.gubit.cn/mango/jiazhi/688186.html. Key warning: all of the above 2026-2028 forecasts were published on or before 2026-04-22, all earlier than the 2026 interim report (disclosed 2026-08-24, attributable to parent -93.33%); East Money rating statistics show "0 firms within 1 month, 0 firms within 2 months, 2 firms within 3 months" (1 Buy + 1 Accumulate, composite rating "Accumulate," coefficient 4.50), indicating that there have been no new reports since the interim report and consensus has not yet been revised down; the existing consensus is likely significantly overstated (for example, 2026E attributable to parent RMB 270-335 million, while 2026H1 actual was only RMB 12 million, requiring an extreme reversal in H2 to be achievable). This is the most important uncertainty in this section. Actual vs. forecast retrospective: FY2025 actual attributable to parent was RMB 205.9 million, significantly lower than the then-current broker forecasts for 2025 (Guosen RMB 337 million, Huaxin RMB 360 million, Zhongtai RMB 360 million, Minsheng RMB 318 million, Soochow RMB 308 million, Huatai RMB 194→376 million), meaning the full year was approximately 35%-45% below consensus, which can serve as evidence that "sell-side forecasts for this stock are systematically optimistic."

3.3 Valuation Levels and Institutional Ratings

The research summary does not provide real-time valuation multiples such as PE and PB; valuation-related data is missing or uncertain, and no quantitative valuation conclusion can be given. Valuation-related information that can be referenced: Huatai Securities' 2026-04-22 research report assigned 2026 23.9x PE (comparable company 2026E average 23.9x), with target price RMB 22.94; Guosen Securities' 2025-04-25 target price RMB 30.56-32.47 (based on 2025 18-22x PE); Huaxin Securities' 2025-06-26 report date closing price RMB 28.26, corresponding PE 15.7/12.8/11.4x; Zhongtai Securities' 2025-06-29 corresponding PE 18/14/12x; Huatai Securities' 2024-12-31 target price RMB 18.25. According to the latest market data basis around 2026-09-12, the retrieved pages show a stock price of approximately RMB 13.66 (Sohu Securities, down 2.15% this week, with main funds net outflow of RMB 6.1198 million in total). Institutional forecasts for 2026E net profit attributable to parent are RMB 270-335 million, while 2026H1 actual was only RMB 12 million, requiring an extreme reversal in H2 to be achievable; all forecast publication dates were on or before 2026-04-22, all earlier than the 2026 interim report, and there have been no new reports after the interim report and consensus has not yet been revised down, so the existing consensus is likely significantly overstated. Industry classification bases are inconsistent (East Money "Steel" vs. Sohu/Baidu "Power Equipment - Wind Power Equipment - Wind Power Components"), and attention should be paid to basis differences when making peer valuation comparisons. There is an uncertainty regarding the total share capital basis (280.49 million shares vs. Baidu Baike's 222.59 million shares).

4. Recent News and Announcements

4.1 Completion of the Second Phase of Share Repurchases

The company's second phase of share repurchases through centralized bidding (board resolution on 2025-06-17, announcement numbers 2025-060/2025-064) was completed on 2026-04-28: cumulative repurchases of 9,080,000 shares, accounting for 3.2372% of total share capital, average price RMB 22.03/share, maximum RMB 26.06, minimum RMB 20.02, total funds used RMB 200,044,010.81 (announcement 2026-022, 2026-04-30). The plan had a total fund amount of RMB 200-400 million, a price ceiling of RMB 39.52/share, intended for employee stock ownership plans/equity incentives and/or conversion of convertible bonds, with funds from an ICBC Zhangjiagang Branch special loan (maximum RMB 360 million) + self-raised funds, term from 2025-06-18 to 2026-06-17. The first repurchase implementation was on 2025-07-29 (announcement 2025-084). Progress track: as of 2026-01-31 and 2026-02-28, cumulative repurchases were both 2,600,000 shares (0.9270%), amount RMB 62,371,384.46, price range RMB 20.96-26.06, with no repurchases in January and February 2026 (announcement 2026-009, 2026-03-04); as of 2026-03-31 still 2,600,000 shares, with no repurchases in March; as of 2026-04-22, 6,800,000 shares (2.4243%), RMB 152,969,094.09, range RMB 20.78-26.06 (announcement 2026-019, 2026-04-23); as of 2026-04-27, 8,560,000 shares (3.0518%), RMB 189,613,360.32, range RMB 20.44-26.06 (announcement 2026-029, 2026-04-29). Note: the above data in the 2026-04-29 announcement was only seen in one republication, and the original PDF was not directly captured; moreover, the text mistakenly wrote the cutoff date as "April 27, 2025," creating a transcription error risk, and the implementation results announcement on the following day (2026-022) should be taken as authoritative.

4.2 First Phase of Share Repurchases and Change in Use of Repurchased Shares for Cancellation

The company's first phase of repurchases (board resolution at end-2024, disclosed 2025-01-02/01-04, announcement numbers 2025-004/2025-007) had a plan size of RMB 200-400 million, a price ceiling of RMB 26.22/share, funds from a Huaxia Bank Zhangjiagang Branch special loan + self-raised funds, intended for equity incentives/employee ownership or conversion of convertible bonds, with a term of 12 months. As of 2025-02-28, cumulative repurchases were 7,433,586 shares (3.4697%), total amount RMB 135,995,760.01, maximum RMB 19.29, minimum RMB 16.48. On 2025-05-12, the annual shareholders' meeting approved a proposal submitted by Zhangjiagang Guangda Investment Holding Group—to change the use of part of the repurchased shares and cancel them. Shares held in the repurchase special account: 11,722,611 shares (4.18%) at end-2025Q3; by the equity registration date of the 2025 annual shareholders' meeting (2026-05-13), 19,208,037 shares, total share capital 280,489,356 shares, voting shares 261,281,319 shares. Uncertainty: the shareholdings under the two repurchase special account bases (11.72 million shares → 19.20 million shares) and the direction of the statement "partial cancellation" are not fully consistent, and it is recommended to recheck the "share capital changes" section of the latest annual report/semi-annual report.

4.3 2026 Employee Stock Ownership Plan

On 2026-04-30, the company's 25th meeting of the third board of directors approved the "2026 Employee Stock Ownership Plan (Draft)" and its summary, the "Management Measures," etc.; the remuneration and assessment committee issued a verification opinion, and Anhui Tianhe Law Firm issued a legal opinion (considering the subject qualification and content compliant, still subject to shareholder meeting approval); on the same day, shareholder Zhangjiagang Guangda Investment Holding Group, which holds 15.97%, submitted a temporary proposal to add the employee stock ownership plan-related proposals to the 2025 annual shareholders' meeting for deliberation (equity registration date 2026-05-06). On 2026-05-12, the 2025 annual shareholders' meeting approved it (218 shareholders attended, voting rights 76,026,399 shares). Key points of the plan: total funds ceiling RMB 200 million, no more than 400 participants, duration 36 months, stock source from secondary market purchases. Implementation progress: as of 2026-07-31, the employee stock ownership plan had purchased 1.13 million shares through the secondary market (0.4029%), with total transaction amount RMB 15.1751 million.

4.4 2026 Interim Results (Disclosed 2026-08-24, Reported 8-25)

Operating revenue RMB 2.323 billion, YoY -8.36%; net profit attributable to parent RMB 12.3436 million, YoY -93.33%; non-GAAP attributable to parent RMB 11.3168 million, YoY -93.67%; basic EPS RMB 0.04; weighted ROE 0.26%; net cash flow from operating activities -RMB 231 million (same period last year -RMB 343 million). Gross margin 13.50% (YoY -7.21pct), main business gross margin 13.37% (-7.31pct). Q2 revenue RMB 1.305 billion (YoY -7.62%, QoQ +28.23%), Q2 net profit attributable to parent RMB 7.0772 million (YoY -93.62%). No distribution or capital reserve conversion in the 2026 interim period. Main reasons for performance decline (company basis): reduced new wind power installations led to declining wind power order delivery, lower output and capacity utilization, and higher unit fixed costs; depreciation dilution in the initial stage of production for fundraised projects; VAT additional deductions fell from RMB 17.8787 million to RMB 7.1214 million. Subsidiary divergence: Xinsheng Smart Manufacturing (wind power gearbox precision components) lost RMB 52.1995 million; Deyang Guangda New Materials (energy and power cast steel parts) had net profit of RMB 58.6924 million. Industry background: 2026H1 national new wind power installations were 38.62GW, a decrease of 13.94GW year-on-year (2025 was boosted by the "14th Five-Year Plan" conclusion + rush installation under Document No. 136). Number of shareholders: as of 2026-06-30, 16,700 households, down 3,064 households from end-Q1 (-15.48%); top ten shareholders together held 80.5970 million shares (28.73%).

4.5 2025 Annual Performance Express (2026-02-28, Announcement 2026-008)

Total operating revenue RMB 4,924,186,200, YoY +23.01%; net profit attributable to parent RMB 214,440,500, YoY +87.06%; non-GAAP attributable to parent RMB 201,054,000, YoY +170.32%; total assets at period end RMB 12,632,738,700 (+10.20%); equity attributable to parent RMB 4,728,363,900 (+30.35%); net assets per share RMB 16.86; share capital YoY +30.92% (due to convertible bond conversion). The formal annual report was disclosed around 2026-04-22. This data is preliminary accounting, and the periodic report should ultimately prevail.

4.6 2025 Q3 Report (2025-10-23/24)

Revenue for the first nine months RMB 3,774.81 million (same period last year RMB 2,959.33 million), net profit RMB 248.77 million (same period last year RMB 79.31 million), basic EPS RMB 1.09; during the same period, credit impairment of RMB 17.1692 million and asset impairment of RMB 2.9581 million were recognized (announcement 2025-118).

4.7 2025 Annual Profit Distribution Plan (No Cash Dividend)

The 2025 annual profit distribution did not distribute cash dividends (investor returns were implemented through share repurchases), approved by the 2026-05-12 annual shareholders' meeting. The 2024 annual report was RMB 3.825 per 10 shares (ex-rights ex-dividend 2025-06-12). Cumulative cash distributions 7 times totaling RMB 329.1 million; cumulative financing 3 times totaling RMB 3.580 billion; cumulative cash dividends over the past three years (cash distribution + repurchases) RMB 100.0 million, average annual net profit attributable to parent RMB 143.2 million, ratio 69.84%.

4.8 Guangda Convertible Bond (118023) Conversion and Mandatory Redemption

Large-scale conversion occurred during 2025—in this period, convertible bonds with a face value of RMB 1,545.487 million were converted into 74,247,877 shares; on 2025-08-25, convertible bonds with a face value of RMB 4.464 million were mandatorily redeemed (the remaining portion). Conversion raised total share capital from approximately 226 million shares to 280,489,356 shares (280 million shares) as of 2025-08-22. Previously, the first extraordinary shareholders' meeting in 2025 deliberated "downward revision of the conversion price of Guangda Convertible Bonds." Note: conversion details come from the 2025 annual report notes and media republications; for specific terms, the original SSE announcements should be consulted.

4.9 Shareholders' Meetings and Shareholder/Fund/Secondary Market Dynamics

On 2026-04-30, main funds had a net outflow of RMB 31.355 million, accounting for 15.76% of total transaction value. That week (9.7-9.11, from which it is inferred that "current" is approximately mid-September 2026): the stock price fell 2.15% for the week, and main funds had a total net outflow of RMB 6.1198 million; on September 11, main funds had a net sell of RMB 820,700. Margin financing and securities lending: margin financing and securities lending balance accounted for 6.43% of circulating market value (financing balance RMB 470 million, securities lending balance RMB 122,500, 2026-03-17); Stock Connect holdings accounted for 0.21% of circulating A shares (RMB 13.1872 million, 2025-12-31). The time anchors are inferred from article publication dates, not directly displayed on official pages, and the actual operating dates should prevail.

4.10 Valuation Data Multi-Source Conflict Warning

Under the interim report basis, Sina said PE(TTM) was approximately 27.74x and PB(LF) approximately 0.80; China Securities Network said PE(TTM) was approximately 114.61x and PB(LF) approximately 0.83; Lixinger (approximately 2026-03-04) showed a stock price of RMB 26.06, market value RMB 7.310 billion, PE 25.73, PB 1.53; Tonghuashun iwencai on 2026-03-13 showed RMB 17.17, +2.88%. The same indicator differs greatly across sources, likely due to TTM window basis, conversion dilution and outdated pages, and should not be used as a conclusion.

4.11 Uncertainty and Coverage Gap Statement

1) For categories such as reductions/increases in holdings, grant of equity incentives, regulatory inquiries/penalties, and mergers and acquisitions/restructurings, no relevant 2026 announcements were found in this search, but due to search step limitations, a complete month-by-month announcement penetration was not performed, and it cannot be concluded that "there are none"; it is recommended to recheck against the exchange announcement list. 2) The time anchor is inferred (approximately mid-September 2026), not directly displayed on official pages; please correct according to the actual operating date. 3) Single-source data: the "cumulative repurchases of 8,560,000 shares/RMB 189,613,360.32" in the 2026-04-29 announcement was only seen in one republication and carries transcription error risk. 4) The shareholding basis of the repurchase special account is inconsistent before and after (11,722,611 shares vs. 19,208,037 shares), requiring rechecking. 5) Performance express/Q3 report/annual report data are all marked "unaudited" or "preliminary accounting," and the periodic reports should ultimately prevail. 6) Valuation/PE data conflict across multiple sources and cannot be cited as a single conclusion. 7) It was not possible to cross-verify whether there were performance forecasts or targeted policy announcements (such as wind power installation/electricity price policies) during 2026Q2-2026Q3; the 2026H1 industry data (38.62GW) comes from company/media paraphrase and should be rechecked against National Energy Administration data.

5. Stock Price Trend and Technical Analysis

5.1 Price Overview

5.2 Technical Indicators

The technically confirmable information in the research summary is limited: two market price versions appear, RMB 13.66 and RMB 13.93, neither marked with a corresponding time point, so a unified price baseline cannot be determined; key technical indicators such as moving averages, Bollinger Bands, recent swing highs and lows, 52-week highs and lows, and turnover rate are all not given as specific values in the summary, so it is impossible to make data-supported judgments on trend direction, overbought/oversold conditions or key levels. The relatively usable information is concentrated in fund flows: main funds had a total net outflow of RMB 6.1198 million in the week of 9.7-9.11, of which September 9 saw a net sell of RMB 4.0059 million, September 10 a net buy of RMB 63,800, and September 11 a net sell of RMB 820,700; individual fragments also show that transaction value fluctuated between RMB 67.8548 million and RMB 150 million, but their correspondence to the current price is not indicated. Shareholder structure and institutional holdings data in the summary only have source links and no specific values, and such data is usually disclosed quarterly and clearly lags, so it cannot be used directly for short-term judgment. Overall, this section should wait until the current day's closing price, moving average/Bollinger values, turnover rate and transaction value data are supplemented before making a trend characterization; at present, only an observation framework based on fund flows and available price fragments can be given.

5.3 Short-Term Trend Outlook (Next Week, Scenario Deduction, For Reference Only)

⚠️ Risk Warning: The following content is only a subjective scenario deduction based on the existing price and fund flow fragments in the research summary. It does not constitute investment advice, nor any recommendation to buy, sell, hold or any target price.

① Key Technical Levels

② Next Week's Scenarios (Subjective Weighting, Not Statistical Probability)

• Consolidation and range-bound trading (relatively higher weight, approximately 60%) (subjective heuristic weighting, set based on the current technical and fund flow situation, not statistical probability): undefined
• Weaker downward movement (medium weight) (subjective heuristic weighting, set based on the current technical and fund flow situation, not statistical probability): undefined
• Rebound and strengthening (lower weight) (subjective heuristic weighting, set based on the current technical and fund flow situation, not statistical probability): undefined

③ Fund and Liquidity Background

The research summary does not provide specific values such as turnover rate, average daily transaction value range, top ten shareholder concentration, or institutional holdings such as public funds/social security/QFII, so a quantitative judgment on the chip structure cannot be given. Reference fragments are: transaction value appeared between approximately RMB 67.8548 million and RMB 150 million (corresponding to 2026-06-23 and two other fragments without marked dates), main funds had a total net outflow of RMB 6.1198 million in the week of 9.7-9.11, and single-day main funds ranged between a net buy of RMB 63,800 and a net sell of RMB 4.0059 million. Although shareholder list-type data has source links in the summary (such as the circulating shareholder list disclosed as of June 30, 2026), specific holding ratios and institutional names are not given, and such data is usually disclosed quarterly with a lag of at least one quarter or more, so the structure may have changed since then, and the latest disclosure should prevail when citing. Before the above data is completed, it is not appropriate to draw conclusions on liquidity breadth and institutional participation.

The research summary does not provide a baseline for the stock's recent normal single-day transaction value and turnover rate, so an effective volume-confirmation threshold cannot be calibrated from its own volatility range; after supplementing transaction value and turnover rate data for the past 20 trading days, a verifiable volume signal can be set, such as "single-day transaction value continuously expanding to a certain multiple above its 20-day average."

④ Points to Watch (Observation Ideas Only, Not Operational Instructions)

• Supplement the current day's closing price, MA5/MA10/MA20 and Bollinger upper/middle/lower band values, and re-delineate short-term resistance, first support and strong support ranges on this basis (currently all are in a data-missing state).
• Track whether main fund flows can shift from a weekly net outflow to sustained net inflow, observing the direction of change against the base of a net outflow of RMB 6.1198 million in the week of 9.7-9.11.
• Track transaction value and turnover rate data, and after completing the baseline for the past 20 trading days, set verifiable volume confirmation signals accordingly.
• Track the latest disclosure of shareholder structure (the existing list points to June 30, 2026, and lags), and verify actual changes in institutional holdings and concentration.

The above scenario deduction is based on the limited price and fund flow fragments in the research summary (including fund flows in the week of 9.7-9.11 and several price and transaction value data without marked dates) and historical price and technical indicator calculations, but key data such as moving averages, Bollinger Bands, turnover rate and shareholder concentration are missing from this summary. Short-term stock prices will also be disturbed by multiple factors such as news, fund flows and the broader market environment. Technical indicators themselves have lag and limitations, do not guarantee future actual movements, and do not constitute buy or sell advice. Please make independent judgments based on the latest market information and bear investment risks yourself.

6. Industry Landscape and Competitor Analysis

6.1 Industry Status

The company belongs to the high-end equipment special steel materials and wind power components industry chain, positioned in the upstream supplier segment of the wind power industry chain; from 2022 to 2024, the wind power industry chain experienced "severe involution" and casting product prices hit new lows. In 2025, tendering accelerated and expectations for an industry upturn rose. The company achieved both revenue and profit growth in 2025, but profit nearly fell to zero in 2026H1, indicating that the industry price recovery has not yet been transmitted to the stability of the company's profitability.

6.2 Competitive Landscape

• Multiple industry classification bases exist: Sohu Securities classifies it under "Power Equipment - Wind Power Equipment - Wind Power Components"; Huaxi F10 classifies it under "Steel"; Tonghuashun industry index shows that on 2026-07-25 the company was transferred from "Industrial Machinery and Supplies and Components" to "Wind Power Equipment," reflecting that the market's recognition of its wind power attributes is becoming clearer.
• Downstream prosperity: accelerated wind power tendering, a big year for offshore wind, and gearbox project ramp-up are the main logics watched by sell-side analysts (Minsheng Securities 2025-04-23; multiple 2022 annual report and 2023 Q1 report commentaries by AVIC New Materials and Sina republications all took "wind power upstream supplier, fully benefiting from a big year for offshore wind" as their theme).
• Competitive landscape: from 2022 to 2024, the wind power industry chain experienced "severe involution" and casting product prices hit new lows (original wording in the company's 2024 annual report); in 2025, the company achieved gross margin recovery through product mix optimization and cost reduction and efficiency improvement, but it came under pressure again in 2026H1, indicating that industry price and cost cycles still have a decisive impact on the profit volatility of midstream suppliers.
• Company response: the 2025 annual report clearly states that it "adheres to an efficiency-oriented approach, dynamically optimizes the product structure, continuously advances various cost reduction and efficiency improvement measures, and effectively controls costs through process improvement, lean management, supply chain optimization, etc."; at the same time, it extends into high-end materials (high-temperature alloys, special stainless steel, controllable nuclear fusion supporting materials, commercial aerospace) to open up profit space.
• New growth points: controllable nuclear fusion (materials for superconducting coil armor have been supplied in batches, and the company won the bid for the BEST coil box machining project) and commercial aerospace (stainless steel products are said to "already meet the conditions for aerospace applications") are regarded by sell-side analysts as a second growth curve, but the summary does not disclose the related revenue scale or order amount.

6.3 Main Competitors

Compared with downstream OEMs and gearbox manufacturers, Guangda Special Material is in the midstream processing position of the industry chain, a price-taker for upstream scrap steel/alloys/pig iron (scrap steel + alloys + pig iron together accounted for approximately 57%-62% of total material procurement in 2021-2023), and faces high downstream customer concentration (top five customers accounted for 70.67% in 2023), with relatively weak bargaining power, reflected in relatively high sensitivity of gross margin to raw material prices and downstream price reduction cycles: in 2025, gross margin recovered to 17.33% under product mix optimization and cost reduction and efficiency improvement, but in 2026H1 it sharply dropped to approximately 13.5% and net profit attributable to parent fell 93.33% year-on-year (secondary source, not cross-verified with the original interim report), indicating that the sustainability of profit recovery has not yet been established. Relative advantages lie in the integrated capability covering the product line from special steel materials to high-end components, and extension into high-margin directions such as high-temperature alloys, controllable nuclear fusion and commercial aerospace, but the summary does not disclose the revenue contribution of these new directions, so their impact on overall profit margin cannot yet be quantified.

7. Risk Warnings

• Wind power demand and order delivery volatility risk: in 2026 H1, the company disclosed a reduction in new wind power installations, leading to declining wind power order delivery and lower output and capacity utilization; wind power revenue accounted for approximately 57.16% of 2025 main business revenue, so changes in wind power prosperity or installation pace may directly affect the company's revenue and fixed cost absorption.
• Continued gross margin decline risk: the company's main business gross margin fell from 17.33% in 2025 to approximately 13.37%-13.50% in 2026 H1, while revenue fell only 8.36% year-on-year but profit fell more than 93%, indicating that changes in price, cost and capacity utilization have a strong amplifying effect on profit.
• Raw material price and procurement carryover lag risk: scrap steel, alloys and pig iron together accounted for approximately 57%-62% of total material procurement, and the company has limited bargaining power over upstream suppliers; raw material price fluctuations, especially changes in high-alloy scrap steel and alloy prices such as nickel and chromium, may compress gross margin when there is a time lag between procurement and cost carryover.
• Downstream customer concentration and bargaining risk: top five customers accounted for 70.67% of sales in 2023, and top five customers accounted for 49.78% of accounts receivable and contract assets at the end of June 2026; major customers include Mingyang Smart Energy, Nanjing High Speed Gear, Siemens and ZF. If core customers impose price pressure, adjust orders or change payment collection pace, the company's revenue, gross margin and cash flow may be affected.
• Capacity expansion and depreciation dilution risk: the company disclosed increased depreciation in the initial stage of production for fundraised projects, combined with lower output and capacity utilization, resulting in higher unit fixed costs; if new capacity is released more slowly than expected, it may continue to pressure profitability and return on assets.
• Cash flow and capital occupation risk: in 2026 H1, net cash flow from operating activities was -RMB 231 million, and the company's accounts receivable and contract asset customer concentration is relatively high; if order delivery, acceptance or payment collection continues to slow, working capital occupation and financing pressure may increase.
• Earnings forecast distortion risk: existing market institutional forecasts for 2026-2028 are all earlier than the 2026 interim report. The 2026 forecast net profit attributable to parent is RMB 270-335 million, but 2026 H1 actual was only RMB 12.3436 million, and 2025