Zhitong Finance App News, Jinlong Electromechanical (300032.SZ) announced that the company holds 5% of the shares in Qingdao BOE Optoelectronics Technology Co., Ltd. (“Qingdao BOE”) through its indirect wholly-owned subsidiary Dongguan United Dongchuang Optoelectronics Technology Co., Ltd. (“Dongchuang Optoelectronics”). Currently, the company plans to transfer 5% of its shares in Qingdao BOE to Hefei BOE Optoelectronics Technology Co., Ltd. (“Hefei BOE”) for 241 million yuan. After the transfer was completed, the company no longer holds shares in Qingdao BOE.

Purpose of the transaction: Qingdao BOE is the implementing entity of BOE's IoT mobile display port device production base project invested by BOE. The company originally planned to bring a reasonable return on investment to the company by investing in this project, and will use the investment in this project to strengthen cooperation with BOE in the glass cover business and enhance the market competitiveness and influence of the company's glass cover business. After the above project was put into operation, the benefits of the project fell short of the company's expectations, and losses continued. The audited losses for Qingdao BOE in 2022 and January to November 2023 were -44.491,000 yuan, respectively, and are still in a state of loss.

The company has developed some cooperation with BOE in the glass cover business through its participation in Qingdao BOE, but the business volume is small and falls short of the company's expectations. The company's glass cover business has little room for business development in the current situation where competition in the industry is fierce and the market share of the industry is still concentrated on leading companies. In view of the above situation, the company transferred 5% of Qingdao Jingdong's shares, withdrew from the investment in the project, and used the cash to supplement working capital, which will help improve the company's asset structure and increase liquidity; at the same time, it will also help the company concentrate its energy and resources to develop other main businesses such as more advantageous structural components, and promote the company's long-term development.