Analysis of the Impact of Jin Hongshun (603922) Actual Controller's Disappearance and Share Freeze on Control Rights

Based on the information searched, I will analyze in detail the impact of the disappearance of Jin Hongshun’s actual controller and the freeze of 54 million shares on the company’s control rights.

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Jin Hongshun Automotive Parts Co., Ltd. (Stock Code: 603922) is facing a severe corporate governance crisis.

, and all shares held by Hainan Zhongde Technology Co., Ltd., the controlling shareholder under his control, have been subject to judicial sequential freezing, involving approximately 53.74 million shares, accounting for 29.99% of the company’s total share capital[1][2].

This incident has aroused great concern in the market about the stability of the company’s control rights, especially at the 2nd Extraordinary General Meeting of 2025 held on January 4, 2026, where the proposal by the second largest shareholder Gaode Investment to remove Liu Xu from his directorship was vetoed.

, which is highly consistent with the shareholding scale of Hainan Zhongde under Liu Xu’s control[3][4].

According to the company’s announcement, the shares of controlling shareholder Hainan Zhongde are in a multi-level judicial freeze status:

Freeze Type	Number of Shares	Percentage of Its Shareholding	Percentage of Total Share Capital
Judicial Freeze	1,501,080	2.79%	0.84%
Judicial Marking	52,241,000	97.21%	29.15%
Judicial Sequential Freeze	54,537,364	101.48%	30.43%

• The cumulative pledged shares of Hainan Zhongde are 52,241,000, with a pledge ratio of as high as
  97.21%
  [5]
• In October 2025, a pledge involving 4.6 million shares was not repaid upon maturity, triggering default clauses[1]
• As of November-December 2025, the total amount of enforcement against Zhongde Technology reached
  RMB 220 million
  [2]

At the 2nd Extraordinary General Meeting of 2025, regarding the proposal to remove Liu Xu from his non-independent director position:

• Opposing Vote Ratio: 61.76%
• Number of Opposing Shares: Over 54 million
• This figure is surprisingly consistent with the shareholding of Hainan Zhongde (53.74208 million shares)

This result indicates that:

[3][4].

Shareholder	Shareholding Ratio	Status
Hainan Zhongde (controlled by Liu Xu)	29.99%	Controlling Shareholder
Gaode Investment	Approximately 10%	Second Largest Shareholder
Former Actual Controller Hong Jiancang’s Camp	-	Attempting to Regain Control Rights

According to reports,

, with his term starting from the date of approval by the board of directors until the election of the 4th board of directors by the shareholders’ meeting[2]. However, Liu Xu’s camp still shows unyielding resistance through the exercise of voting rights.

1. The veto of the dismissal proposal shows that the current control rights are still in the hands of Liu Xu’s camp
2. The voting mechanism can still operate normally; although the shares are frozen, the voting rights have not been legally deprived
3. Although Hong Jiancang’s camp attempts to return, it faces strong resistance from Liu Xu’s camp

1. Judicial Disposal Risk
   : If creditors continue to pursue debts, the frozen shares may be judicially auctioned or sold
2. Pledge Default Risk
   : A pledge ratio of 97.2% means that a decline in stock price will trigger forced liquidation
3. Capital Chain Break
   : Zhongde Technology’s own asset-liability situation is extremely fragile, and its debt-solvability is questionable

According to the announcement:

[5].

In addition to share freezing, the company also faces multiple governance crises:

On September 8, 2025, Hainan Zhongde, Beijing Jin Hongshun (a wholly-owned subsidiary of Jin Hongshun), and Dongtai Tenghui jointly borrowed

from Jiangxi Xunzhi Trading, with an annual interest rate of 12% and a term of only one month. The funds were directly transferred to Dongtai Tenghui’s account, while , and the company claimed that this was not its true intention[1][4].

• The 2024 annual audit found that
  related parties of the controlling shareholder non-operatively occupied the listed company’s funds
• Multiple planned major asset restructurings have failed (Huibo Yuntong, De Laser Tech, Fengfa Renewable Resources, New Thinking Motors)
• Vice Chairman Wang Haibao has also gone missing along with Liu Xu

Dimension	Current Status	Forecast
Short-Term Control Rights	Stable but Controversial	Liu Xu’s Camp Still Controls Decision-Making Power
Medium-Term Control Rights	Highly Uncertain	Depends on the Progress of Judicial Disposal
Long-Term Control Rights	Possible Change	Creditor Enforcement or Introduction of New Investors

1. The freeze of 54 million shares does not result in an immediate loss of control rights
   : According to China’s Company Law, share freezing does not equal loss of voting rights; the original shareholder can still entrust the exercise of voting rights before the completion of judicial auction

2. Behind-the-scenes control is still in operation
   : The veto of the dismissal proposal proves that there is an organized voting agency mechanism, ensuring that Liu Xu’s camp can still block unfavorable proposals even when the actual controller is missing

3. The risk of control rights change is accumulating
   : The combination of high-proportion pledge and judicial freeze means that the control structure may change rapidly once any creditor applies for enforcement

4. Corporate governance continues to be under pressure
   : The disappearance of the actual controller exposes serious flaws in the internal governance mechanism, and investors need to be alert to potential compliance risks in the future

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[1] Eastmoney - How Did Jin Hongshun Become a “Cash Cow” for Shareholders? (https://caifuhao.eastmoney.com/news/20260107212503455771860)

[2] Sohu News - Fierce Game for Control of Jin Hongshun: Where is Actual Controller Liu Xu? Former Actual Controller Returns to Steer (https://m.sohu.com/a/973898129_116062)

[3] Sina Finance - Second Largest Shareholder Proposes Dismissing the Chairman and Others, Over 54 Million Votes Cast Against (https://finance.sina.com.cn/jjxw/2026-01-05/doc-inhffsft8159239.shtml)

[4] NetEase News - Another Enterprise Crisis! Company’s Actual Controller Missing, All Equity Frozen (https://www.163.com/dy/article/KIMO2C2T0556A3TB.html)

[5] Sina Finance - Jin Hongshun: Announcement on Judicial Sequential Freezing of Controlling Shareholder’s Shares (https://money.finance.sina.com.cn/corp/view/vCB_AllBulletinDetail.php?stockid=603922&id=11881672)