CHINA RISUN GP (01907) "Hydrogen Strength" targets downstream industry leaders, promotes equity cooperation, connects the hydrogen industry chain, and accelerates the layout of green hydrogen.

CHINA RISUN GP (01907) and SINOHYTEC (688339.SH, 02402), may soon generate a "chemical reaction" in the hydrogen energy field, which is full of commercial potential. On February 27, CHINA RISUN GP and SINOHYTEC simultaneously announced that CHINA RISUN GP intends to subscribe for the high-quality hydrogen energy assets of its subsidiary, Dingzhou Xuyang Hydrogen Energy Co., Ltd. (hereinafter referred to as "Dingzhou Xuyang"), with SINOHYTEC's A-share shares that are being planned for issuance. It is reported that the two parties have signed a cooperation intent agreement regarding the above-mentioned transaction. The alliance between Xuyang Group and SINOHYTEC holds significant meaning. Firstly, looking at the backgrounds of both parties, Xuyang Group has been developing hydrogen energy business since 2020 and currently has the highest production of high-purity hydrogen in the Beijing-Tianjin-Hebei region. Leveraging its solid "hydrogen strength," Xuyang Group was also recently included in the Hang Seng Shanghai-Hong Kong Stock Connect Hydrogen Theme Index, launched by the Hang Seng Index Company to invest in high-quality Hong Kong and A-share listed companies involved in the production, transportation, distribution, and storage of hydrogen energy. On the other hand, SINOHYTEC has strong innovative research and development advantages in fuel cell systems and stacks. In terms of business synergy, Xuyang Group's advantages in the hydrogen energy sector focus more on research and development, production, and transportation. Upon investing in SINOHYTEC, not only can Dingzhou Xuyang's hydrogen gas gain more stable sales channels, but it can also help save intermediary costs and empower Xuyang's hydrogen energy to better serve the application side. This cooperation may also bring about some longer-term positive changes. Xuyang Group has already planned to develop green hydrogen projects in stages, based on the principle of "exploring the market with by-product hydrogen, gradually replacing with green hydrogen." The company aims to gradually establish a green hydrogen production capacity of 5000 tons per year. Additionally, Xuyang Group plans to link green hydrogen with the group's chemical sector to produce products such as green methanol and green synthetic ammonia. Considering SINOHYTEC's outstanding strengths in fuel cell systems and stacks, it is worth noting whether the "strengthened wings" of Xuyang Group will further raise the company's green hydrogen strategic goals. Once the transaction is finalized, Xuyang Group will become one of the major shareholders of SINOHYTEC, aligning with its consistent investment strategy of becoming the largest shareholder through mergers and acquisitions. Currently, the above-mentioned matters are still in the planning stage, and the progress and final results of the transaction still need to be observed. However, it can be reasonably predicted that after this cooperation, both parties will take a series of follow-up actions. With the joint efforts of Xuyang Group and SINOHYTEC, the Chinese hydrogen energy industry is expected to enter the "fast lane" of development.