In-Depth Analysis of Institutional Share Reduction and Bearish Logic for Dongpeng Holdings

Based on collected information, I will systematically analyze the situation of Dongpeng Holdings’ share reduction by Sequoia Capital and institutional bearish logic for you.

---

According to public information, Sequoia China has continuously reduced its holdings in Dongpeng Holdings through two investment entities under its control—HSGHoldcoB and Beijing Sequoia Kunde Investment Management Center (Limited Partnership)-Shanghai Zede Investment Center [1]:

Share Reduction Phase	Time	Number of Shares Reduced	Cash Proceeds	Change in Shareholding Ratio
Initial Share Reduction Plan	May 2024	Original plan: no more than 3%	—	—
Official Share Reduction	Disclosed in May 2025, completed in September	16,518,800 shares	RMB 92.7662 million	6.15%→4.69%
Subsequent Share Reduction	2025 Q3 Report	Continued share reduction	—	2.55%, 2.72%→1.57%, 1.77%

: The shareholding ratio of the two major shareholders has dropped below 5%, and no further disclosure will be required for subsequent share reductions. This “secret share reduction” trend deserves investors’ vigilance [1].

---

As a leading enterprise in China’s building and sanitary ceramics industry, Dongpeng Holdings is facing systemic downward pressure in the industry.

[2][3]:

• From January to November 2025, the sales area of newly built commercial housing in China decreased by 7.8% year-on-year, and sales volume decreased by 11.1% [1]
• Demand in the building and sanitary ceramics industry is weakening, with oversupply, and market competition has shifted from incremental to stock-based competition [2]

Financial Indicator	2024	YoY Change	2025 First Three Quarters	YoY Change
Operating Revenue	RMB 6.469 billion	-16.77%	RMB 4.501 billion	-3.9%
Net Profit Attributable to Shareholders	RMB 328 million	-54.41%	RMB 349 million	+13.09%*
Tile Revenue	RMB 5.387 billion	-18.15%	RMB 2.485 billion	-3.64%

*Note: The net profit growth in the first three quarters of 2025 is mainly due to the low base in the same period of the previous year and cost compression [2]

---

• Tile Business
  (accounting for 83.27% of total revenue) continues to shrink, with both glazed and unglazed tiles showing a downward trend. Among them, the revenue of unglazed tiles dropped from RMB 426 million in 2022 to RMB 28 million in the first half of 2025, a sharp decline of 93.4% [1]
• Revenue from
  sanitary ceramics
  and
  bathroom products
  decreased by 10.69% and 1.07% year-on-year respectively [2]
• The engineering channel has adopted a prudent strategy and actively controlled the undertaking of low-quality projects, further compressing the space for revenue growth [3]

The

:

• Sales expenses decreased by 11.97% year-on-year to RMB 481 million
• General and administrative expenses decreased by 14.28% year-on-year to RMB 229 million
• R&D expenses shifted from a slight increase in the first three quarters to a decrease of 1.7% [1]
• Profit growth mainly relies on cost compression, rather than substantive business improvement

• The book value of inventory increased from RMB 1.685 billion in 2024 to RMB 1.71 billion in the first three quarters of 2025 [1]
• Inventory write-down provisions of RMB 66 million were accrued in 2024, and asset impairment losses reached RMB 98 million in the first three quarters of 2025
• Although tile production has been reduced (-2.07% year-on-year), inventory volume still increased by 4.47% [1][2]

• The net cash flow from investing activities in 2024 decreased by 1606.87% year-on-year [2]
• The amount of accounts receivable and notes receivable has increased, leading to higher collection risks [2]

---

:

• The stock price fell from a high of RMB 12.43 (forward-adjusted) in 2023 to a low of RMB 4.8, a drop of approximately
  61%
  from the high
• As of January 7, 2026, the stock price was approximately RMB 6.66, still down about
  46%
  from the high [1]
• The current market value is less than RMB 10 billion, standing at RMB 7.705 billion, with a TTM P/E ratio of 20.89 times [1]

:

Time Node	Number of Institutional Holders	Cumulative Shareholdings
2024 Annual Report	100	831 million shares
2025 Q3 Report	16	797 million shares

The number of institutions

, and the number of shareholdings decreased simultaneously [1][3]

---

Institutional Bearish Logic for Dongpeng Holdings
│
├── Macro Level: Sustained Real Estate Downturn → Ceramics Industry Demand Contraction
│
├── Revenue Level: Comprehensive Decline of Main Businesses, Unglazed Tile Business Near "Zero"
│
├── Profit Level: Growth Relies on Cost Compression, Not Business Improvement
│
├── Asset Level: High Inventory, Expanded Impairment Losses
│
├── Cash Flow Level: Sharp Deterioration of Investment Cash Flow
│
├── Shareholder Level: Sequoia Capital's Continuous Share Reduction, Sending Exit Signal
│
└── Market Level: Substantial Withdrawal of Institutional Investors, Valuation Under Pressure

. Against the backdrop of the real estate industry not yet truly recovering and intensified stock competition, the challenges faced by the company cannot be fundamentally reversed in the short term.

---

• Real estate industry recovery falls short of expectations
• Risk of fluctuations in raw material and energy prices
• Inventory write-down risk
• Accounts receivable collection risk

---

[1] CNFOLL Finance Channel - “Successively Reduced by Sequoia Group, Dongpeng Holdings Sees Revenue Decline, Profit Growth Relies on ‘Cost Cutting’” (http://mp.cnfol.com/54564/article/1767780680-142202480.html)

[2] Sina Finance - “Interpretation of Dongpeng Holdings’ 2024 Annual Report: Net Profit Drops by Over 50%, Cash Flow Volatility Requires Attention” (https://finance.sina.com.cn/stock/aigc/stockfs/2025-04-19/doc-inetrwna0640575.shtml)

[3] Eastmoney Wealth Channel - “Successively Reduced by Sequoia Group, Dongpeng Holdings Sees Revenue Decline, Profit Growth Relies on ‘Cost Cutting’” (https://caifuhao.eastmoney.com/news/20260107181109189635370)