Research Express | Tang Ren Shen Receives Investor Research Visit from Zou Xianghai and 1 Other Investor; Provides Detailed Explanation of RMB 230 Million Goodwill Sources and Cyclical Response Measures

On March 23, Tangrenshen Group Co., Ltd. (hereinafter referred to as “Tangrenshen”) conducted a targeted investigation with individual investor Zou Xianghai. The company’s Securities Department General Manager Xu Yan and Investor Relations Management Officer Dong Xiaoxue participated in the reception, providing detailed answers to market concerns regarding the company’s goodwill composition, reasons for profit and loss fluctuations, pledge status of controlling shareholders, industry cycle response measures, and the scope of meat product sales.

Basic Information of the Investigation

Key Issue Analysis

3 Billion Yuan in Goodwill: Building a Full Industry Chain Through Four Strategic Acquisitions

In response to the investor’s question about “how the 230 million yuan in goodwill was formed,” the company stated that as of September 30, 2025, the goodwill mainly stems from four strategic acquisitions. Specifically, the acquisitions include: first, acquiring Shandong Hemei to expand feed business scale and enhance market share and regional layout in the feed sector; second, acquiring Longhua Agriculture and Animal Husbandry to enlarge breeding operations, increase pig farming capacity, and promote full industry chain development; third, acquiring Shenzhen BillyMe to complement the front-end feed business with the company’s existing feed operations, improving product structure; and fourth, acquiring Jitai Agriculture and Animal Husbandry to extend the industry chain layout.

Profit and Loss Fluctuations: Industry Cycles and Other Objective Factors Dominate, No Inflated Losses

Regarding concerns about “significant profit and loss fluctuations in recent years and whether there are inflated losses,” the company clearly responded that it always adheres to legal and compliant operations, with no inflated losses. Annual financial reports are audited by a certified accounting firm that issues standard unqualified opinions. The fluctuations are mainly influenced by industry cycle variations, sharp swings in pig prices, changes in feed costs, and other objective factors. The company is strengthening risk resistance by focusing on core businesses, optimizing the full industry chain layout, and improving refined management.

Pledge of Controlling Shareholders: 94 Million Shares for Personal Funding, Unrelated to the Company

Regarding the pledge of shares by controlling shareholders, the company disclosed that as of now, the controlling shareholder has pledged 94 million shares, accounting for 58.35% of their holdings. This pledge is for the shareholder’s own operational funding needs and is unrelated to the listed company.

Responding to Industry Cycle Bottom: Four Measures to Cross the Cycle

In response to the current industry cycle bottom, the company has adopted four measures: first, strengthening full industry chain coordination and improving integrated layout of “feed—pig farming—meat products” to ensure production continuity and stability; second, flexibly adjusting capacity structure based on national policies and market price fluctuations, scientifically adjusting pig slaughtering structure and scale; third, building cost competitiveness through comprehensive disease prevention and cost management, optimizing production indicators; and fourth, maintaining financial security by strengthening fund coordination and liquidity management to ensure the safety of the capital chain.

Meat Product Sales: Offline Focus on Hunan, Combining Online and Offline Channels

Regarding the scope of meat product sales, the company stated that it adopts an online-offline integrated model, with offline sales mainly covering Hunan Province.

This investigation helps investors gain a clearer understanding of Tangrenshen’s industry chain layout, risk response, and operational strategies, providing transparent information for the market.

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