Product positioning is high-end, with a full range of nylon. After more than 20 years of development and accumulation, the company's nylon industry has established a high-end brand image within the industry and established the brand's competitive advantage. The company's nylon filament production line uses international advanced process design. The machinery and equipment have a high innovation rate, advanced technology, and high production efficiency. On the basis of introducing the most advanced production lines and engineering technology from abroad, three core technologies with independent intellectual property rights have been formed through digestion, absorption, and re-innovation: differentiated and functional civilian nylon filament production technology, differentiated and functional product development platform construction technology, and equipment innovation and transformation technology. The company's nylon products include nearly 100 types of civilian nylon filaments in the six categories of POY, HOY, FDY, DTY, ATY and ACY. The civilian nylon filaments produced have high weaving stability and dyeing uniformity, and the comprehensive properties of some varieties have surpassed similar foreign products.

Domestic consumer demand has been released at an accelerated pace, and domestic demand for textiles and clothing has maintained a good recovery trend. In 2023, with the implementation of various policies and measures to expand domestic demand and promote consumption, residents' demand for diversified and personalized clothing was released at an accelerated pace, and domestic demand for textiles and clothing in China maintained a good recovery trend. According to data from the National Bureau of Statistics, retail sales of clothing, footwear, and textile products per unit above the national limit increased 12.9% year-on-year in 2023, and the growth rate rebounded 19.4 percentage points from 2022. Driven by positive factors such as the improvement of the online retail consumer experience and the booming e-commerce market, the online retail sales rate recovered well. Online retail sales of clothing products increased 10.8% year-on-year in 2023, and the growth rate rebounded 7.3 percentage points from 2022.

Acquire high-quality assets to achieve complementary advantages and scale expansion. With the acquisition of Yate New Materials, the company achieved the sharing of production capacity and market resources, further reduced procurement costs, improved production efficiency, broadened customer resources, and achieved complementary advantages. It not only solved competition in the industry, but also integrated business lines such as sales, procurement, R&D, etc., to make better use of the synergetic advantages of business integration; the acquisition of production equipment and other assets related to Zhejiang Deshap's nylon fiber business and the collection of 100% shares in Jiangxi is a horizontal integrated merger and acquisition in the same industry. After the merger and acquisition is completed, the company will have an annual production capacity of 6,000 tons of nylon 66. In addition, it will also help increase the market share of the company's nylon business and further consolidate the company's position in the differentiated nylon filament segment.

Sell the cross-border e-commerce sector and focus on the development of the main business. In December 2023, the company signed a “Cooperation Framework Agreement” with Huakai Ebai. The company plans to sell 100% of the shares of the wholly-owned subsidiary Tongtuo Technology and all operating assets related to its main business (including but not limited to trademarks, patents, stores, inventory assets, etc.). The transaction is progressing in an orderly manner. This transaction will help the company to further focus on the development of its main business, improve asset quality, optimize the industrial structure, enhance the company's core competitiveness, and meet the company's future development strategy.

Risk warning: the risk of additional production capacity in the market; the risk that downstream market demand falls short of expectations; the risk that the commissioning progress of projects under construction falls short of expectations; the risk of a sharp increase in raw material costs.