From its origins as the "Leading Jewelry Store in Northeast China," crafting ceremonial pieces for the Qing royal family, to becoming an ST-listed company under regulatory investigation with its bank accounts frozen, CuiHua Jewelry's century-long journey has reached an unsettled pause in early 2026. On February 10, following a trading halt, the company's stock abbreviation changed to "ST CuiHua," with its daily price fluctuation limit narrowed to 5%. On its first day of resumed trading, the stock hit the lower limit.
The previous day, this century-old brand, which operates a store within the Palace Museum, suspended trading for one day. An evening announcement revealed that the company had received a formal investigation notice from the China Securities Regulatory Commission (CSRC) for suspected violations of information disclosure regulations. Compounding its troubles, 45 of the company's bank accounts have been frozen, and it has accumulated overdue loans totaling 254 million yuan.
Compared to frequently trending top brands like Lao Feng Xiang and Chow Tai Fook, CuiHua Jewelry appears relatively lesser-known. However, founded in 1895, this historic company once produced gold and silver ritual objects for the Qing imperial court. For a long time, CuiHua primarily focused on the Northeast China market. It wasn't until 2009, when it expanded south to Shenzhen to establish a production base, listed on the Shenzhen Stock Exchange in 2014, and opened a direct-operated store within the Beijing Palace Museum in 2017, that it gradually entered the national market spotlight.
Today, the company's glory has faded amidst substantial overdue loans and multiple frozen bank accounts. One contributing factor, alongside insufficient self-generating cash flow from its core business, appears to be a strategic foray into a new sector. As early as 2023, CuiHua Jewelry acquired a 51% stake in Siteary Lithium for 612 million yuan in cash, venturing into the new energy lithium battery sector. This cross-industry investment directly increased long-term debt, sowing the seeds for subsequent financial strain.
The company now finds itself at a critical juncture, caught between debt and liquidity pressures. Zhou Ting, Dean of the Key Customer Research Institute, pointed out that the "dual pressures" of continuous losses in the lithium salt business and significant capital tied up in gold inventory have directly led to a liquidity crunch. In the short term, this not only damages brand credibility but could also affect consumer purchasing and repurchase decisions, weaken the confidence of franchisees, suppliers, and financial institutions, slow down accounts receivable collection, tighten financing channels, and create a chain reaction of negative impacts.
The financial crisis began to surface at the end of January 2026. On January 28, while international gold prices were surging, CuiHua Jewelry suddenly disclosed issues with loan repayments. The announcement stated that due to tight working capital, the company and its subsidiary, Shenzhen CuiHua, had failed to repay borrowings on schedule. As of the announcement date, overdue loan principals totaled 234 million yuan across six financial institutions, including Bank of Communications, Shanghai Pudong Development Bank, China Guangfa Bank, Bank of China, Industrial Bank, and China Zheshang Bank.
Following this disclosure, the company's stock experienced abnormal declines over three consecutive trading sessions, with a cumulative decline deviation exceeding 20%, triggering an exchange alert for unusual volatility. On the evening of February 6, further announcements indicated a worsening liquidity situation. The total overdue loan principal for the company and its subsidiaries expanded to approximately 254 million yuan, an increase of about 20 million yuan. Several financial institutions have initiated lawsuits or arbitration, leading directly to the freezing of 45 major bank accounts belonging to the company and its subsidiaries, with a total frozen amount of 4.72 million yuan.
The debt crisis has also affected the controlling shareholder. Due to the company's loan defaults, controlling shareholder Chen Siwei, who provided joint liability guarantees for related credit facilities, has seen 30.74 million of his shares—representing 100% of his holding and 12% of the company's total shares—frozen and subject to secondary freezing. Furthermore, shares held by major shareholder Shenzhen Cuiyi Investment Co., Ltd. (holding over 5%) and its acting-in-concert parties, Guo Yingjie and Guo Yuchun, involving over 31.28 million shares (approximately 12.21% of total shares), have also been judicially frozen and re-frozen.
Facing these multiple pressures, CuiHua Jewelry stated in its announcements that it has implemented several countermeasures. These include communicating with creditors and courts to seek the lifting of account freezes through measures like asset swaps, intensifying efforts to collect accounts receivable to accelerate cash flow, and focusing on improving operational conditions.
It is worth noting that as early as September 2025, the Shenzhen Stock Exchange issued a regulatory letter to CuiHua Jewelry. The letter pointed out that the company had provided joint liability guarantees for comprehensive credit facilities of 100 million yuan each from Industrial Bank and Bank of Beijing to its wholly-owned subsidiary, Shenzhen CuiHua, in January and April 2025 but failed to disclose this information promptly after signing the contracts, only making an announcement on August 12, 2025.
According to its 2025 performance forecast, driven by a recovery in the gold market, the jewelry segment's performance showed slight growth, and the lithium salt segment turned a profit. The company estimated its non-net profit to be between 162 million yuan and 242 million yuan, a year-on-year increase of 154.81% to 280.64%. However, due to the transfer of a 2% stake in Phosphorus Fluoride Lithium Industry by its controlling subsidiary, Siteary Lithium, which was consequently deconsolidated, CuiHua's estimated net profit attributable to shareholders was only 21 million yuan to 31 million yuan, a sharp decrease of 85.69% to 90.31% year-on-year.
On the surface, CuiHua's recent performance has not been poor. From 2022 to 2024, its operating revenues were 4.2 billion yuan, 4.6 billion yuan, and 4.4 billion yuan respectively, with net profit attributable to shareholders rising from 47.09 million yuan to over 200 million yuan. In the first three quarters of 2025, revenue was 3.38 billion yuan, essentially flat year-on-year, while net profit attributable to shareholders was 174 million yuan, an increase of nearly 50%. This performance is not considered weak within the context of a challenging gold and jewelry industry.
However, underlying risks in its financial structure cannot be ignored. At the end of 2022, the company's total liabilities were approximately 1.8 billion yuan. By the end of September 2025, this figure had risen to about 4.3 billion yuan, more than doubling in less than three years, with current liabilities accounting for over 90% at 3.9 billion yuan. At the same time, the company's monetary funds on the books were only 438 million yuan, while short-term borrowings stood as high as 1.7 billion yuan, indicating a strained financial position.
More alarmingly, in the first three quarters of 2025, net cash flow from operating activities was approximately 45.56 million yuan, a decrease of nearly 60% year-on-year. The company acknowledged in its financial report that the decline in operating cash flow was mainly due to a decrease in cash received from sales. This suggests that despite growth in book profit, the actual cash "in the pocket" was not ample, indicating pressure on collection capabilities.
Against the backdrop of tightening operating cash flow, financing activities became a crucial source of support. In the first three quarters of 2025, net cash flow from financing activities was about 100 million yuan, a significant year-on-year increase, primarily due to new bank credit facilities and increased borrowing. Independent fashion consultant Wang Ning analyzed that the gold and jewelry industry is currently facing multiple challenges, including weak consumption, channel transformation, and gold price fluctuations. Many enterprises rely on loans and credit to support expansion, but if sales collections are delayed, this financing model can create liquidity pressures.
From an industry perspective, CuiHua's cross-industry expansion has, to some extent, acted as an "accelerator" for its debt accumulation. Since 2023, CuiHua Jewelry entered the lithium salt sector, attempting to build a "dual-core business" structure. Its 2025 interim report showed that gold products remained the absolute mainstay, contributing about 72% of revenue, while lithium products and processing business accounted for about 22%. The company stated that the move into lithium salt was intended to counter cyclical fluctuations in the gold and jewelry industry and enhance risk resistance through a dual-core strategy.
However, in practical terms, the lithium salt business has not yet become a "second growth curve." On the contrary, affected by declining carbonate lithium prices, Siteary Lithium reported net losses of 186 million yuan in 2023 and 65.0977 million yuan in 2024. Zhou Ting noted that the continuous losses from the lithium salt business directly erode net profit while consuming substantial working capital in project construction, capacity deployment, and operation maintenance, thereby squeezing resources that could have been allocated to R&D, marketing, and channel upgrades for the core jewelry business, resulting in a clear "misallocation of resources."
"The root of this risk lies in the lack of strategic steadfastness among decision-makers, who mistook short-term market hype in the new energy sector for genuine opportunity," she added. She further pointed out that the repeated setbacks in Chinese companies' diversification attempts show that ventures straying from core competencies and ignoring industry cycles often fail to become new growth drivers and instead evolve into financial burdens.
Despite its heritage as a purveyor of宫廷 jewelry and the加持 of the Palace Museum IP and intangible cultural heritage craftsmanship, CuiHua Jewelry has gradually become marginalized in the high-end ancient-method gold segment. In 2024, revenue from its jewelry-related business was 3.6 billion yuan, a decrease of 14% year-on-year. Although performance in 2025 was expected to improve due to rising gold prices, its main revenue still heavily relied on the wholesale and franchise model. Data indicates that wholesale and franchise business accounts for over 90% of total revenue, resulting in a gross profit margin for the jewelry business of only around 13%. This is far lower than Lao Feng Xiang's over 40% and the approximately 30% margins of Chow Tai Fook and Chow Sang Sang, highlighting its insufficient profitability and ability to command high-end premiums.
As of June 2025, CuiHua Jewelry had 455 stores, a net decrease of 21 within six months. Of these 455 stores, only 13 were directly operated. The store focus remains in Northeast China, accounting for half the total, followed by North China. South China had only one store. Although the Beijing Palace Museum direct-operated store possesses a稀缺 IP resource, its presence in consumers' minds is limited. In the first half of 2025, its revenue was only 2.64 million yuan, ranking eighth among the 13 direct-operated stores, less than one-tenth of the revenue of the flagship store in Shenyang and lower than the performance of other Beijing direct-operated stores like those in Oriental Plaza and Jinyuan Yansha.
One consumer recalled that the CuiHua Palace Museum store is located west of the Imperial Garden. When she visited with an out-of-town friend years ago, there were few customers. "My friend bought a red enamel-inlaid bracelet, about 3 grams, priced over 3,000 yuan. It felt quite expensive at the time, and I even posted on social media, calling it the most expensive cultural creative product I'd bought," she said. She found the bracelet exquisite but was unaware that CuiHua was a listed jewelry company, assuming it was merely a Palace Museum collaborative文创 brand.
It is understood that while CuiHua's other Beijing direct-operated stores also sell Palace Museum products, certain specific Palace Museum文创 styles are exclusively available at the museum store. "Although CuiHua Jewelry holds the稀缺 resource of having a 'store within the Palace Museum' and focuses on the popular niche of ancient-method gold and宫廷 gold, the core of its predicament lies in the dual drag of weak growth in its core business and losses from its new venture," Zhou Ting pointed out. Firstly, IP conversion efficiency is insufficient, failing to form high-end溢价 and core competitiveness. Secondly, over-reliance on franchising weakens control over the end-point, affecting brand image and customer loyalty. Thirdly, the blind expansion into lithium salt, lacking experience and risk assessment, has tied up capital from the core business, creating a vicious cycle where the "core business输血 while the new business失血."
By the end of the third quarter of 2025, the company's inventory scale had reached 3.7 billion yuan, accounting for about 76% of its current assets. Wang Ning noted that high inventory is common in the jewelry industry, where companies primarily hold precious metals like gold as stock. The 2025 interim report showed gold assets of approximately 3 billion yuan, constituting over 80% of total inventory. "The problem is, when consumption slows and channel turnover decelerates, although such assets possess value retention, they are difficult to liquidate quickly. Capital remains locked in inventory for extended periods, increasing reliance on bank financing," he said.
The drawbacks of a high-leverage, low-turnover model thus become apparent. "If the proportion of gold inventory is high, strategies like bulk sales to financial institutions or swaps with peers can quickly alleviate funding pressure, buying time for strategic adjustments and operational recovery." However, Zhou Ting believes that inventory of gold raw materials and finished products has relatively strong liquidity. "Gold, as a hard currency, has good流通性, transparent pricing, and mature回收 and trading channels. Even with price fluctuations, funds can be recouped quickly through discounted sales. Simultaneously, gold's value-preservation attribute means its value fluctuation is controllable, making it an important liquidity reserve for enterprises."