Cited from:HOSHINE silicon industry wechat public number

At a performance exchange meeting in mid-May, 68-year-old Chairman Luo Liguo of HOSHINE Silicon attended to address investor questions. His company, HOSHINE Silicon, specializing in silicon-based materials and photovoltaic new energy, has seen a significant drop in net profit of 49.05% in 2023, marking the second consecutive year of decline.

The company's main business of industrial silicon and organic silicon has been impacted by falling product prices due to market supply issues. Despite efforts to increase production capacity to lower costs, the company has experienced a decline in gross profit margins for both main products.

Facing operational pressures, HOSHINE Silicon is also embroiled in a shareholder dispute with former executives. Moreover, the company's heavy investments in downstream photovoltaic projects have yet to yield substantial returns. As of the end of March 2024, the company's industrial silicon inventory was 240,000 tons and cash flow from operating activities was -2,594 million yuan. Capital markets are not optimistic either. As of May 17, its share price had fallen more than 75% from its all-time high in 2021, wiping out ￥240 billion in market value.

To weather the storm, Luo Liguo plans to buy back the company's shares in 2024, with a total amount of 500 million to 1 billion yuan and enhance employee compensation and governance structures. The road ahead remains challenging for the Luo family as they navigate through this difficult period.