A 46-year-old veteran polyester enterprise is teetering on the brink of delisting. Sanfangxiang, a polyester leader from Jiangyin, Jiangsu, received an 'adverse opinion' and 'internal control negative opinion' on its 2025 annual report, triggering a dual delisting risk warning. The controlling shareholder's shares have been put up for judicial auction, and cumulative overdue guarantee debts have exceeded 500 million yuan. This is not just a single company's crisis but the inevitable outcome of extreme capacity competition across the entire polyester industry.
Overcapacity: From 800 Million Profits to 1.6 Billion Losses
Sanfangxiang's financial trajectory is a textbook case of supply-demand imbalance in the polyester sector. In 2020, the company, originally focused on textile printing and dyeing, acquired Hailun Chemical for 7.35 billion yuan in a 'snake-swallows-elephant' deal, shifting its main business to bottle-grade polyester chips and PTA. In the first two years after the acquisition, 2021 and 2022, it posted profits of 630 million and 818 million yuan respectively. But from 2023 onward, the industry winds shifted sharply. By 2025, the company had accumulated losses of 1.628 billion yuan over three consecutive years, with a single-year loss of 885 million yuan in 2025, a significant year-on-year expansion.
The money was devoured by 'involution.' Industry public data shows that from 2023 to 2024, domestic polyester bottle-chip capacity was released intensively, with total capacity exceeding 20 million tons per year, while market demand was only about 12 million tons per year. The supply-demand gap reached 8 million tons, compressing product spreads to near cost levels. As the industry's second-largest manufacturer, Sanfangxiang also launched large-scale capacity expansion, but the result was that while output increased, profits were completely crushed by fierce price wars.
More fatal was the single-link industrial chain layout. Sanfangxiang only covered the PTA to polyester bottle-chip segment, with core raw material PX highly dependent on external purchases. Once upstream PX prices fluctuated, the weakness in cost control capabilities was fully exposed. In 2025, the company's trading business revenue fell 59.97% year-on-year to 1.713 billion yuan, directly reflecting the shrinking market demand and loss of pricing power.
Debt Minefield: Dual Pressure from Guarantee Overdue and Related-Party Receivables
Beyond operating losses, Sanfangxiang's debt risks are equally alarming. As of the latest announcement, the company's cumulative overdue debts from guarantees for subsidiaries and inter-subsidiary guarantees had reached 522 million yuan, accounting for 10.82% of the most recent audited net assets. Among these, wholly-owned subsidiary Hailun Petrochemical failed to pay due rent on a financial lease, triggering the company's irrevocable joint liability guarantee.
A bigger hidden risk lies in related-party transactions. As of the end of the 2025 reporting period, the company's accounts receivable from related parties stood at a staggering 3.561 billion yuan, but the accumulated provision for bad debts was only 107 million yuan. The auditor explicitly stated that it could not obtain sufficient and appropriate audit evidence for the recoverable amount of these receivables. The controlling shareholder's shares have been judicially frozen; if subsequent disposal occurs, the company's actual control may change. The company also did not recognize a provision for a 600 million yuan related-party guarantee provided to the controlling shareholder—these figures point to enormous financial uncertainty.
Dawn of Anti-Involution: Can State Intervention Turn the Tide?
Sanfangxiang's crisis is not without a turning point, and that turning point comes from the very source of the crisis—involution. In the second half of 2025, relevant national authorities held a symposium with leading PTA and bottle-chip enterprises, discussing industry operations and ongoing project progress. Against a backdrop of supply-demand mismatch and razor-thin profits, this symposium was seen by the industry as an important signal to prevent and resolve 'involutionary' competition.
The effects of policy intervention began to emerge in the first quarter of 2026. Sanfangxiang achieved a net profit of 32.7409 million yuan, turning from loss to profit year-on-year. Meanwhile, geopolitical tensions in the Strait of Hormuz led to a significant rebound in polyester chain product prices, improving profit margins. The company's stock price also staged a phased recovery, temporarily moving away from the 1-yuan delisting 'red line.'
But risks are far from resolved. In June 2026, Lianhe Credit downgraded Sanfangxiang's long-term credit rating to A- with a negative outlook. Although the controlling shareholder's share auction was temporarily suspended due to an execution objection, the 'sword of Damocles' hanging overhead has not disappeared.
Industry Lessons: The Survival Crisis of Single-Link Enterprises
The Sanfangxiang case sounds an alarm for the textile and chemical fiber industry. In the polyester chain, companies that only cover the single link from PTA to bottle chips have extremely fragile risk resistance. Upstream PX raw materials are subject to external control, downstream demand is squeezed by both macroeconomics and capacity cycles, and the profit space in the middle link is almost drained.
In contrast, other industry leaders have built more complete industrial chains by extending upstream into PX or downstream into textiles, packaging, and other fields. Sanfangxiang's predicament shows that in a cycle of overcapacity, the scale advantage of a single link is no longer a moat; instead, it can become a burden.