Chenghui International (01094) and Xinhui Yuanheng set up a joint venture

According to Zhitong Finance App, Chenghui International (01094) announced that on December 3, 2025, Chengguang Zhongcai, a wholly-owned subsidiary of the Company, signed a joint venture agreement with Xinhui Yuanheng regarding the establishment of a joint venture.

According to the terms of the joint venture agreement, the registered capital of the joint venture company will be RMB 120 million. Chengguang Zhongcai should inject RMB 45 million (equivalent to about HK$49.5 million) into the joint venture, accounting for 37.5% of the joint venture's registered capital, while Xinhuiyuan Heng should inject the remaining registered capital of RMB 75 million (equivalent to approximately HK$82.5 million) into the joint venture company, accounting for 62.5% of the joint venture's registered capital. Therefore, Chengguang Zhongcai will only be a minority shareholder of the joint venture company, and the financial results after the establishment of the joint venture will not be incorporated into the company's financial statements.

The main business of the joint venture company is (including) sales of photovoltaic equipment and components; provision of information system integration services; photovoltaic power generation equipment rental; battery sales; smart transmission, distribution and control equipment sales; sales of power electronic components; sales of charging piles; sales of integrated circuits; technical services, technology development, technical consulting, technology exchange, technology transfer, and technology promotion.

As disclosed in the Company's interim results announcement for the year ended September 30, 2025, the Group is actively seeking new business opportunities to support future growth, including exploring the photovoltaic inverter business in China with a deep understanding of the new energy industry and long-term experience. Through the establishment of a joint venture with Xinhuiyuan Yuanheng, the Group can quickly enter the core circuit, use the technical knowledge of Xinhuiyuan Hengshiyi's owners and their network in the market to quickly seize market share in the localized replacement of photovoltaic inverters and overseas export market share, rely on Xinhuiyuanheng's local sales network to cover domestic distributed photovoltaic project scenarios, and combine the Group's international brand influence and overseas pipeline resources to achieve joint expansion of the “domestic+overseas” dual market, while integrating the patented technology of both parties to reduce the production lines and manufacturing resources of Xinhuiyuan Hengshiyi's mature supply chain Cost and investment in production capacity construction .

The Group pursues the goal of promoting sustainable development and environmental protection. In response to China's central government's initiative to achieve carbon peak by 2030 and carbon neutrality by 2060, the Group promotes sustainable development and environmental protection by providing energy management contract services to customers. Since the Group has been participating in solar power generation projects and providing services for the past few years, the Group's management believes that investing in joint ventures will not only enable the Group to improve its technical level, but also bring synergy to the Group, as it may introduce more general contractor opportunities for the Group, especially photovoltaic power generation projects.

The Group's management believes that overall, in order to meet the upcoming era of “future industry” development and changes in China's macroeconomic structure and environment and achieve prosperity, the Group must adjust itself and seize opportunities as soon as possible. The directors believe that investing in joint ventures as a minority shareholder gives the Group a good opportunity to achieve two goals in the promising and rapidly developing new energy industry, namely entering the photovoltaic inverter industry; and expanding the market share of the new energy (such as solar energy) industry in which the Group has always participated by providing general engineering contracting services.