On July 16, TCL Electronics fell 10.98% in regular trading, trading at HK$13.81/share, with turnover of HK$138 million. The sharp decline came after the company announced a major acquisition late on July 15.

TCL Electronics disclosed that it entered into a sale and purchase agreement to acquire 100% equity of TCL AeroWell (Cayman) Holdings Limited for a total consideration of HK$56.1 billion, to be paid via a combination of cash and consideration shares. The target company is held by five sellers — NXTHome (31.37%), YF Rongye (28.00%), Core Elite (17.41%), Union Vast (16.25%), and Reach Glory (6.96%). The transaction constitutes a major and connected transaction involving the issuance of consideration shares under a special mandate.

Market participants reacted negatively to the potential equity dilution and integration risks. Notably, the company had already increased its authorized share capital from HK$3 billion to HK$5 billion effective June 22, adding 2 billion ordinary shares in preparation for the share issuance. For reference, TCL Electronics reported revenue of HK$114.58 billion and net profit of HK$2.495 billion for fiscal year ending December 2025, with cash reserves of HK$13.52 billion at year-end.

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