The Zhitong Finance App learned that on April 24, 2024, the signing ceremony of the “Technical Management Service Agreement between Luoyang Longze Energy Co., Ltd. and Xuyang Marketing Co., Ltd.” was held in the lecture hall on the 10th floor of Building 1 of Xuyang Building. Yang Xuegang, Chairman of Xuyang Group (01907), and Wang Haojie, Chairman of Luoyang Longze Energy Co., Ltd. (“Luoyang Longze”), attended the event.

According to the agreement, Xuyang Group will deploy a professional team to provide technical management services for Luoyang Longze's sales, transportation, production, supply, research and other production and operation processes, rely on Xuyang's marketing platform and supply chain system to improve Luoyang Longze's operating efficiency, and provide technical support in production technology transformation, environmental protection improvement, process optimization, energy saving and consumption reduction.

Luoyang Longze is located in Ruyang County, Luoyang City. It has two 5.5-meter coke tamping ovens with an annual production capacity of 1 million tons; it is equipped with a dry and quenching set, which is expected to be put into operation in September 2024; and plans to build projects such as advanced treatment of concentrated salt water, hydrogen extraction from coke oven gas, and special railway lines. Luoyang Longze has been deeply involved in the coking industry for many years and plays an important role in regional economic development.

Xuyang Group was founded in 1995 and is headquartered in Beijing. It has established production parks and companies in 12 provinces, cities, autonomous regions and many countries in China, forming an integrated global industrial chain, supply chain and operation management system for sales, transportation, production, supply and research. The industry has become a large-scale enterprise group integrating the collaborative development of business sectors such as coke, chemicals, new energy, new materials, etc., and has successfully provided management services to many coke, tar and other companies. It has rich experience in coking, chemical operation and significant comprehensive advantages such as coke scale and quality brands.

The first technical management service cooperation between Xuyang Group and Luoyang Longze began in May 2018. The two sides joined hands to create a good cooperation record of completing company registration in 1 day, completing team formation in 3 days, completing formal hosting in 4 days, opening a sales situation in 14 days, and achieving a profit of 10 million yuan in the first month. The basic goal of signing this agreement is to use Xuyang Group's strong sales, transportation and supply supply chain system, brand advantages and industry reputation, and use Xuyang's intelligent coal distribution system and big data accounting system to continuously adjust and optimize coal distribution ratios, and comprehensively reduce coal blending costs.

The signing ceremony was presided over by Li Qinghua, CEO of Xuyang Group. Jiao Junfeng, general manager of Luoyang Longze, and Chen Zhisheng, general manager of Xuyang Marketing, signed the contract on behalf of the two parties. Some senior leaders from both sides also attended the signing ceremony.

This cooperation marks that Xuyang Group's coke technology management service scale reached 6.8 million tons, an increase of more than double compared to 2023. Up to now, Xuyang has a total of 10 coke and chemical technology management service projects, including 5 coke and 5 chemicals, with a total scale of 7.9 million tons. The total scale of Xuyang's coke also increased to 21.6 million tons with the successive commissioning of Xuyang Indonesia's Weishan Project and the continuous increase in the scale of coking and light asset management services, an increase of 26% over 2023, further consolidating its leading position in the industry. Next, Xuyang Group will continue to promote the national layout and global development of Xuyang's business, continuously increase its market share and brand influence, and strive to achieve the goal of managing 30 million tons of coke production capacity and 10% market share by 2025.

Additionally, it is worth mentioning that Xuyang Group's stock price rose 1% on the day the contract was signed, and Hong Kong Stock Connect's shareholding volume reached about 340 million shares, an increase of 85 times compared to the beginning of the listing. As a constituent stock of multiple classified indices under the Hang Seng Index series, FTSE Russell Index series, and the target of the Shenzhen-Hong Kong Stock Exchange and Shanghai-Hong Kong Stock Exchange (Shanghai-Hong Kong Stock Connect) Index series, Xuyang Group has had more than 50 exchanges with domestic and foreign institutional investors since 2024, with more than 150 institutions, and received a “buy and increase in holdings” rating from brokerage research institutes. The company also plans to launch themed reverse roadshows with investors in Dingzhou Park and Cangzhou Park in May and June of this year, so that investors can have a more intuitive and in-depth understanding of Xuyang and enhance Xuyang's influence in the capital market.