Jiangsu Guofu Hydrogen Energy Equipment Launches Placing of New H Shares; Up to HK\$152.52 Million to be Raised

Key Highlights of the Placing Agreement

• Placing Size and Price: Jiangsu Guofu Hydrogen Energy Equipment Co., Ltd. (the “Company”) has entered into a Placing Agreement with Macquarie Capital Limited as the sole placing agent to conditionally issue up to 4,908,950 new H Shares at a placing price of HK\$31.07 per share.
• Gross and Net Proceeds: The expected gross proceeds from the Placing amount to approximately HK\$152.52 million, with net proceeds (after all fees and expenses) estimated at HK\$148.54 million.
• Discount to Market Price: The placing price represents a 12.28% discount to the closing price of HK\$35.42 per share on the agreement date and an 11.57% discount to the average closing price over the past five trading days.
• Share Capital Impact: The placing shares represent approximately 5.08% of the existing issued H Shares and 4.03% of total shares before the placing. After completion, they will constitute around 4.84% of enlarged H Shares and 3.88% of the total share capital.
• Use of Proceeds: The Company intends to allocate approximately 70% of the net proceeds for working capital and general corporate purposes to support business operations and growth, and about 30% for repayment of existing credit facilities. The funds are expected to be fully utilized by December 31, 2027.
• Independent Placees: The shares will be placed to at least six independent professional or institutional investors, with none expected to become a substantial shareholder upon completion.
• Ranking and Lock-Up: The new shares will rank pari passu with existing H Shares, including rights to all dividends declared after their allotment. The Company has agreed to a 30-day lock-up period post-closing on issuing further equity securities (other than this Placing).
• Completion Conditions: The Placing is subject to several conditions, including no material adverse change in the Group’s business or financial markets, accuracy of representations and warranties, receipt of required legal opinions and regulatory filings, and approval from the Stock Exchange’s Listing Committee.

Recent Fundraising Activity

The Company has been active in raising capital over the past 12 months, with the following notable transactions:

1. Issuance of Warrants (July 2025): Raised approximately HK\$239.6 million (net) via the exercise of 6,000,000 warrants. Proceeds are being used for investments and cooperation in hydrogen projects in China and overseas.
2. Placing of New H Shares (Sep 8, 2025): Placed 1,730,000 shares at HK\$54.03 per share, raising approximately HK\$90.98 million (net). Proceeds are being used for hydrogen-related investments.
3. Placing of New H Shares (Sep 29, 2025): Placed 1,994,800 shares at HK\$50.13 per share, raising approximately HK\$98.49 million (net). Funds allocated to working capital, credit repayment, and hydrogen investments.
4. Placing of New H Shares (Oct 23, 2025): Placed 2,405,400 shares at HK\$48.47 per share, raising approximately HK\$113.30 million (net). Funds similarly allocated to working capital, credit repayment, and hydrogen investments.
5. Placing of New H Shares (Dec 2, 2025): Placed 4,858,350 shares at HK\$41.166 per share, raising approximately HK\$196.98 million (net). Proceeds applied to hydrogen project investments and general corporate purposes.

Most proceeds from these fundraisings have already been utilized, with the remaining funds expected to be deployed by the end of 2027.

Impact on Shareholding Structure

After completion of this placing, the Company’s issued share capital will increase from 121,762,689 to 126,671,639 shares. The shareholding of major shareholder Wu Pinfang will dilute slightly from 21.80% to 20.95%, while the new placees will collectively own 3.88% of the enlarged share base. The public float remains robust, with no placee expected to become a substantial shareholder.

Potential Share Price Sensitivities

• Discounted Placing Price: The placing price is set at a significant discount to the market price, which may exert downward pressure on the share price in the short term.
• Dilution Effect: The issue of new shares will result in dilution for existing shareholders, which is typically perceived as negative unless the raised funds are expected to generate substantial long-term returns.
• Use of Funds: The Company’s clear plan to use funds for working capital, growth, and debt repayment could reassure investors about prudent capital management and the focus on operational expansion in the hydrogen sector, which may support share value in the medium term.
• Active Fundraising Trend: The Company’s repeated equity fundraisings in the past year highlight capital needs for aggressive growth or investment, but may also raise concerns about ongoing dilution.
• Completion Conditions & Uncertainty: The Placing remains subject to several market and operational conditions. Any failure to close the transaction or unforeseen adverse developments could impact share price volatility.
• Lock-Up Period: A short-term lock-up of only 30 days on further equity issuance may be watched closely by the market for future dilution risk.

Conclusion

The announced placing is significant and price-sensitive for Jiangsu Guofu Hydrogen Energy Equipment Co., Ltd. It will inject substantial new capital to support business growth, operations, and debt repayment, but comes at a notable discount and involves further dilution for shareholders. Investors should monitor the closing of the transaction, deployment of proceeds, and any signals about future capital raising activity.

Disclaimer: The above article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own due diligence and consult their financial advisors before making any investment decisions. The completion of the placing is subject to various conditions and may not proceed as planned. The Company and its share price may be affected by other factors not detailed herein.

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