A polyester giant founded in 1980 and listed in 2003 now stands on the brink of delisting. Sanfangxiang received both a 'disclaimer of opinion' on its 2025 annual report and an adverse internal control opinion, triggering dual delisting risk warnings. The controlling shareholder's shares are subject to judicial auction. This is not just a single company's crisis but a microcosm of severe overcapacity in the polyester bottle chip sector—domestic capacity exceeds 20 million tons per year against demand of only 12 million tons, pushing supply-demand tensions to a tipping point.
The Financial Cost of Capacity Glut
Sanfangxiang's loss trajectory clearly reflects the industry cycle. It posted profits of 630 million yuan in 2021 and 818 million yuan in 2022, but from 2023 to 2025, it suffered three consecutive years of cumulative losses totaling 1.628 billion yuan. Losses widened from 487 million yuan in 2024 to 885 million yuan in 2025. The core reason lies in the concentrated capacity release in the polyester bottle chip industry during 2023-2024, which continuously compressed spreads. As the second-largest player, the company's large-scale expansion backfired as profits were devoured by cut-throat competition.
More critically, its industrial chain is too narrow. Sanfangxiang only covers the PTA-to-bottle chip segment, relying entirely on external purchases of the core raw material PX. When upstream prices rise, its cost control capability weakens, squeezing margins to near zero. In 2025, trading business revenue fell 59.97% year-on-year to 1.713 billion yuan, indicating shrinking downstream demand.
The Debt and Guarantee Time Bomb
Beyond operating losses, Sanfangxiang faces a guarantee default risk. As of the latest announcement, cumulative overdue debts for which the company provided guarantees to subsidiaries and between subsidiaries reached 522 million yuan, accounting for 10.82% of the latest audited net assets. Hailun Petrochemical, a wholly-owned subsidiary, failed to pay some due rents on a 290 million yuan finance lease, forcing the company to 'actively communicate with creditors and seek loan extensions or rollovers.'
- Accounts receivable from related parties stood at 3.561 billion yuan, with only 107 million yuan in bad debt provisions
- Controlling shareholder and its concert parties' shares are frozen, potentially changing actual control
- 600 million yuan in related-party guarantees for the controlling shareholder have not been recognized as estimated liabilities
These numbers signal huge uncertainty. On June 26, Lianhe Credit Rating downgraded Sanfangxiang's long-term credit rating to A- with a negative outlook.
Policy Intervention Brings a Glimmer of Hope
The industry crisis has drawn regulatory attention. In the second half of 2025, relevant national authorities convened a symposium for PTA and bottle chip leading enterprises to discuss industry operations and project progress. Against a backdrop of supply-demand mismatch and razor-thin margins, the meeting was seen by the industry as a key move to prevent 'cut-throat competition' and promote stable operations.
Policy effects are starting to show. In Q1 2026, Sanfangxiang posted a net profit of 32.7409 million yuan, turning around from losses. The blockade of the Strait of Hormuz boosted polyester chain product prices, improving margins. The company's stock price also rebounded, temporarily escaping the 1-yuan delisting warning line.
But the sword of Damocles remains. In May 2026, the controlling shareholder's shares were scheduled for public auction, which was suspended due to an execution objection. On June 26, Lianhe Credit Rating downgraded its credit rating with a negative outlook.
Implications for the Polyester Industry
Sanfangxiang's case serves as a wake-up call for the entire polyester sector. Overcapacity is not a short-term phenomenon but the result of massive capital inflows over the past few years. When even the second-largest player struggles to profit, it indicates a fundamental breakdown in the industry's profit distribution mechanism.
- Single-link companies have weak resilience: limited to PTA and bottle chips, they are hostage to raw material supplies and squeezed by upstream and downstream players
- Scale expansion does not equal economies of scale: larger capacity leads to deeper competition, higher fixed costs, and heavier losses
- Policy intervention can only ease short-term pain: anti-competition symposiums can boost prices temporarily, but long-term survival depends on corporate competitiveness
For textile and chemical fiber professionals, this signals a trend: future competition in the polyester industry will shift from scale to chain completeness and cost control. Companies betting on a single link will face greater pressure during the shakeout.