Xiongsu pivots to semiconductor packaging as pipe business shrinks
Two loss-making pipe plants shut down Xiongsu suspended production at its Henan and Yunnan subsidiaries because weak property and infrastructure demand left them losing money. Closing them stops the losses from growing, but it also shrinks the company's pipe-making footprint and confirms its core market is under real pressure.
This is the clearest evidence of the demand slump hitting the existing business.
Interim results show shrinking sales and cash outflow First-half revenue fell 14.33% to 405 million yuan and net profit was only about 15 million yuan, while day-to-day operations actually burned 25.7 million yuan in cash. Low debt is a comfort, but the core business is getting smaller and generating less cash.
It quantifies how weak the legacy pipe business has become.
Cash deal to buy into semiconductor packaging materials Xiongsu plans to pay cash for up to 80% of Shenzhen Xinyuan New Materials, valuing it at no more than 800 million yuan. Xinyuan makes heat-dissipation materials for semiconductor packaging and earned about 50 million yuan in 2025, giving Xiongsu a second, higher-growth business.
This is the main new force behind the stock and the reason for the strategic shift.
Promised profits and deal risks still to be proven The sellers commit Xinyuan to at least 58 million yuan profit in 2026 and 192 million yuan over three years, which would dwarf Xiongsu's current earnings. But the price, audit and final agreement are not settled, and the deal could still fall through or disappoint.
It gives the fair counterweight: the upside depends on promises not yet delivered.