Analysis Report

According to public information, Fuen Co., Ltd. (Hangzhou Fuen Co., Ltd.) is a textile enterprise focusing on the R&D and production of recycled fabrics, and is applying for a main board listing. Below is a detailed breakdown of its yarn factories and overall capacity utilization:

Based on the data in the prospectus, the capacity utilization of Fuen Co., Ltd. is as follows [1][2][3]:

Time Period	Self-produced Capacity (10,000 meters)	Self-produced Output (10,000 meters)	Capacity Utilization
Jan-Jun 2025	3,675.94	3,100.77	84.35%
2024	7,396.56	6,851.36	92.63%
2023	6,486.18	5,760.93	88.82%
2022	6,486.18	6,068.33	93.56%

Factory	Jan-Jun 2025	2024	2023	2022
Fuen Co., Ltd. Factory	85.01%	92.92%	94.39%	93.79%
Nantong Yuanji Factory	85.61%	92.22%	82.60%	93.30%

• Small-batch production at Vietnam Fuen Factory
  : The Vietnam base started small-batch production in June 2025, with relatively low capacity utilization
• Equipment upgrade and transformation
  : Some setting machines at Fuen Co., Ltd.'s factory were shut down for the installation of waste heat recovery devices, resulting in a reduction in actual available production time
• Decline in commissioned processing scale
  : The output of commissioned processing decreased from 5.2861 million meters in 2024 to 1.4932 million meters

• During the period, the company increased fabric setting machines through technological transformation, raising the capacity from 64.8618 million meters to 73.9656 million meters
• The slight decline in capacity utilization is a normal ramp-up phenomenon after capacity expansion

• Mainly due to a slight decrease in output caused by normal fluctuations in market demand for 100% polyester fabrics during the period

Fuen Co., Ltd. has three production bases covering the complete vertical industrial chain of ‘spinning - weaving - dyeing and finishing’ [4]:

1. Hangzhou Fuen Co., Ltd. Factory
   : Mainly produces polyester-viscose blended fabrics
2. Nantong Yuanji Factory
   : Mainly produces 100% polyester fabrics, and was awarded the title of National Green Factory in 2023
3. Vietnam Fuen Factory
   : Established in 2024 and put into operation in 2025, focusing on the production of colored spun fabrics with an annual capacity of approximately 10 million meters

• Annual 3,800-ton High-end Wool-like Colored Spun Environmental-Friendly Yarn Project
  : Started small-batch trial production in June 2025, mainly for internal supply, accounting for about 24% of the company’s colored spun yarn procurement demand
• Vietnam Factory Project
  : With an annual capacity of 10 million meters of colored spun polyester-viscose blended fabrics, it is expected to reach full production in the first quarter of 2026

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[1] Shenzhen Stock Exchange - Reply Report to IPO Audit Inquiry Letter of Hangzhou Fuen Co., Ltd. (http://reportdocs.static.szse.cn/UpFiles/rasinfodisc1/202512/RAS_202512_1716254ECEC4BAC88747C9A4DF16081736D5BF.pdf)
[2] Eastmoney.com - Prospectus of Hangzhou Fuen Co., Ltd. (http://pdf.dfcfw.com/pdf/H2_AN202512171802371563_1.pdf)
[3] Sina Finance - Fuen Co., Ltd.'s IPO to Undergo Review, RMB 381 Million Dividend Draws Attention (https://finance.sina.com.cn/tech/roll/2025-12-24/doc-inhcwxmi9846516.shtml)
[4] Fuen Official Website - About Fuen (https://fuen.com/fuen-introduce/)