A polyester giant that started as a township enterprise in 1980 and listed on the A-share market in 2003 now stands at the brink of delisting. Sanfangxiang's 2025 annual report received an 'adverse opinion' and an 'internal control negative opinion,' triggering a dual delisting risk warning. This is not just a single company's crisis but a reflection of the collective pain in China's polyester industry after a capacity surge.
Loss Black Hole Under Capacity Involution
The root of Sanfangxiang's plight lies in severe supply-demand mismatch. The PET bottle chip industry saw concentrated capacity release from 2023 to 2024, with total domestic capacity exceeding 20 million tons per year, while market demand was only about 12 million tons. The sharp contradiction squeezed product spreads. As the second-largest player, Sanfangxiang acquired Hailun Chemical for 7.35 billion yuan in 2020, shifting its main business to bottle-grade polyester chips and PTA, and launched large-scale expansion. The result: capacity grew, but profits were dragged into a quagmire.
Financially, the company suffered three consecutive years of losses from 2023 to 2025, with cumulative losses of 1.628 billion yuan. In 2024, it lost 487 million yuan, and in 2025, the loss expanded to 885 million yuan. The core issue is that PTA and PET bottle chip margins are squeezed by both upstream and downstream—raw material PX is heavily dependent on external purchases, leaving cost control weak. When upstream prices rise, profits vanish. In 2025, trading business revenue fell 59.97% year-on-year to 1.713 billion yuan, confirming the main business's weakness.
Debt Time Bombs and Audit Doubts
More thorny than losses is the debt risk. As of the latest announcement, cumulative overdue debts guaranteed by Sanfangxiang for its subsidiaries reached 522 million yuan, accounting for 10.82% of the latest audited net assets. Among them, subsidiary Hailun Petrochemical failed to pay 25.6376 million yuan in rent due to Taiping石化 Financial Leasing, for which the company provided irrevocable joint liability guarantees.
Auditors also pointed out that as of end-2025, the company's accounts receivable from related parties stood at 3.561 billion yuan, but only 107 million yuan in bad debt provisions had been made. The auditor explicitly stated that sufficient audit evidence for the recoverable amount could not be obtained. Additionally, shares held by controlling shareholder Sanfangxiang Group and Jiangsu Sanfangxiang International Trade were judicially frozen, potentially leading to a change in actual control. The company also failed to recognize estimated liabilities for a 600 million yuan related-party guarantee. Behind these numbers lies huge uncertainty.
Anti-Involution Policy Offers Breathing Room
Sanfangxiang's crisis is not unsolvable. In the second half of 2025, relevant national authorities convened a symposium with major PTA and bottle chip enterprises to discuss industry operations and projects under construction. Against a backdrop of supply-demand mismatch and thin margins, the symposium was seen as an important move to prevent and resolve 'involution-style' competition. Under industry self-discipline and policy guidance, Sanfangxiang turned profitable in Q1 2026, with net profit of 32.7409 million yuan. Recently, the blockade of the Strait of Hormuz triggered a significant rebound in polyester chain product prices, improving profit margins and lifting the company's stock price temporarily above the 1-yuan delisting warning line.
But long-term structural ills remain. Sanfangxiang's industrial chain is too narrow, covering only the PTA-to-PET bottle chip segment, lacking extension into upstream PX or downstream high-value-added products. Compared with industry leaders like Hengli Petrochemical and Rongsheng Petrochemical, which have integrated 'refinery-petrochemical' models, Sanfangxiang's risk resistance is clearly insufficient.