On September 11, 2026, Henan Ancai Hi-Tech Co.,Ltd. issued a notice that drew a clear line under its deteriorating performance woes. The company plans to sell its float glass, pharmaceutical glass, and other non-core business assets to its controlling shareholder, Henan Investment Group, or a designated third party, through non-public agreement transfers and cash sales. The target assets include equity in six subsidiaries, related creditor's rights, and physical assets from the medium borosilicate pharmaceutical glass project. On the day of the announcement, the company's shares hit the daily limit up, closing at 4.94 yuan per share, with main capital net inflow reaching 46.492 million yuan. The market responded to this restructuring with a limit-up move. However, whether this related-party transaction can truly halt the decline of a company that has seen net profit fall for five consecutive years and posted a massive 727 million yuan loss in 2025 is far beyond what a single limit-up board can answer.

The assets being sold are not peripheral pieces but rather multiple business directions that Henan Ancai Hi-Tech Co.,Ltd. had actively pursued in recent years. The medium borosilicate pharmaceutical glass project was once a landmark initiative aimed at "breaking foreign monopoly." The project involved building production lines in the "Three New" Industrial Park in Long'an District, Anyang, with the goal of enabling domestic medium borosilicate pharmaceutical glass to replace low borosilicate and soda-lime pharmaceutical glass. The company is one of the few domestic players capable of mass-producing photothermal glass, holding over 80 patents in the photovoltaic glass sector. Yet, the commercial performance of these "potential tracks" has fallen far short of expectations. The 2025 annual report shows that the float glass business generated revenue of 291 million yuan with a gross margin of -14.15%, meaning for every yuan of float glass sold, the company lost 0.14 yuan. The pharmaceutical glass business accounted for just 1.66% of total revenue. Amid the prolonged downturn in the real estate market, float glass product prices have continued to decline, and losses in this segment have widened year after year. Now, these once-promising businesses have been packaged up and placed on the controlling shareholder's takeover table.

The urgency to divest non-core assets stems from Henan Ancai Hi-Tech Co.,Ltd.'s continuously deteriorating financial fundamentals. For the full year 2025, the company recorded operating revenue of 2.919 billion yuan, down 32.73% year-on-year; net loss attributable to shareholders widened sharply to 727 million yuan from 355 million yuan in the prior year; non-GAAP net loss stood at 734 million yuan; and net cash flow from operating activities was negative 254 million yuan. Entering 2026, the downturn persisted. In the first half of the year, operating revenue fell 38.17% year-on-year to 1.077 billion yuan; net loss attributable to shareholders expanded 52.08% to 328 million yuan; and non-GAAP net loss reached 330 million yuan. On a quarterly basis, gross margin in the second quarter plummeted to -18.47% and net margin to -43.11%, meaning for every 100 yuan of revenue in that quarter, the company absorbed 43 yuan in net losses. The company's debt-to-asset ratio has climbed to 70.11%, financial expenses grew 17.79% year-on-year, while R&D expenses decreased 47.53%. As revenue continues to shrink, debt pressure and financial costs are rising against the trend.

Notably, within Henan Ancai Hi-Tech Co.,Ltd.'s main business structure, photovoltaic glass accounts for 67.05% of revenue, natural gas 16.97%, float glass 9.97%, and pharmaceutical glass just 1.66%. Even the photovoltaic glass segment, which holds the largest share, is far from secure. The company admitted in its interim report that the photovoltaic glass industry remains in a trough, with product prices at historical lows, leading to a year-on-year decline in gross margin. Additionally, on a prudent basis, it made impairment provisions for inventories showing signs of impairment. Industry inventory levels once climbed to approximately 56.8 days, with 2.0mm coated glass prices falling to the 7.8 to 8.5 yuan per square meter range, showing clear pressure at the bottom.

In other words, Henan Ancai Hi-Tech Co.,Ltd. faces not the simple issue of "non-core businesses dragging down the core," but the dual pressure of both its main and non-core businesses being mired in difficulty. Divesting non-core assets is only a stopgap measure to stem losses; the real test lies in whether the core business can generate its own cash flow. PV glass is the core business accounting for nearly 70% of the company's revenue, yet it is confronting the dual challenge of falling volumes and prices. The company's 2026 interim report describes the industry situation as being in a stage of "active production control, inventory clearing, and rational price correction," with installed capacity down 66.04% year-on-year. The 900-ton-per-day furnace remains in the cold repair and upgrade phase, and the realization of production capacity targets is still in progress. At the industry level, capacity clearing in PV glass is far from complete. The national float glass daily melting volume has decreased by 6,860 tons compared to the beginning of the year, with the industry overall in a contraction phase. Although Henan Ancai Hi-Tech Co.,Ltd. is advancing production line upgrades with the goal of raising annual capacity to approximately 100 million square meters and producing thinner, higher-transmittance products, whether capacity upgrades can translate into improved profitability amid shrinking industry demand depends on the pace of PV installation demand recovery and the speed of industry capacity clearing.

Whether this related-party transaction can truly help the company emerge from its loss quagmire hinges on when PV glass prices will bottom out and rebound, and whether production line upgrades can form new cost advantages after industry consolidation. All of this is far more complex than a single letter of intent agreement.